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How Defy Ventures lets inmates pitch a business 'Shark Tank' style, and equips them with job skills

  • Defy Ventures uses a pool of talent drawn from big companies to give inmates job skills, and even seed capital for a business.
  • Defy participants are called 'Entrepreneurs in Training,' have low recidivism rates and get jobs after prison in large numbers.

A California inmate pitches to Defy’s version of “Shark Tank”.
Source: Defy Ventures
A California inmate pitches to Defy’s version of “Shark Tank”.

It was a fateful moment for Shelley Winner, an incarcerated woman at Dublin, a federal prison in California. She was preparing to pitch a start-up idea, Shark Tank style, to a group of successful entrepreneurs and budding business owners.

Winner – a self-described "computer geek" who had aspirations to start her own repair service –spent hours honing her pitch with other inmates. On that day, she walked away victorious, eventually landing a job with Microsoft shortly after leaving the prison's walls.

"When I ended up winning, I swear, there's like a thousand women at that prison – everybody was proud of me," the 39 year old told CNBC recently. In fact, one of the judges of her competition happened to own a tech company who took Winner on as her mentor, employing her after she was released from prison.

Thanks to a program run by Defy Ventures, Winner's experience is just one example of how people convicted of crimes are fighting to earn a new label: Entrepreneur.

Defy offers hope and job skills to a demographic that often faces bleak future prospects. The company has 20 programs in 17 U.S.-based prisons, and offers "Entrepreneurs in Training (EITs)" a 100 course program that most complete while they are in prison. Upon graduation – Defy boasts a 95 percent employment rate – EITs go to work for established companies, or even open businesses of their own.

Three of Defy’s “Entrepreneurs in Training” show off their awards from a pitch session.
Source: Defy Ventures
Three of Defy’s “Entrepreneurs in Training” show off their awards from a pitch session.

Founded by CEO Catherine Hoke, Defy's EIT program generally takes six months to one year. Courses include basic instruction on opening a personal bank account, how to cope with shame, and developing a business plan. Defy also has a second 100 course program EITs can enroll in, if they choose.

For those who graduate, the rewards are real. Along with a sky-high employment rate, Defy graduates have a recidivism rate of around 3.2 percent — a stark contrast to the staggering 76.6 percent of former prisoners who land back in jail within 5 years of their release.

The program is so thorough that Baylor University's MBA program accredits EITs from Defy's one year program upon their completion of the entire program.

Success among Defy Ventures Graduates commands the attention of top business executives such as SAP CEO Bill McDermott, who personally visited a prison to speak to the people he noted for their "grit and mental toughness."

McDermott told CNBC he was "highly impressed by the individuals I met. They welcomed me openly into a very emotional conversation about their lives. They were unafraid to be brutally honest, not only about their mistakes, but also about their dreams for the future."

He added that "it was a powerful reminder to me that every journey has value, even those that temporarily stray from the right path. I left inspired by the courage I witnessed from every person in the Defy program."

Other support has come from top companies like Chase Bank, which administers banking courses for Defy Ventures; and Google, who has added over 450 people to the growing army of volunteers pulled from top companies all across the nation.

Google.org's Principal, Justin Steele, told CNBC that once Google's employees take a trip to prison, they become deeply invested in the success of the EITs. Along with strong volunteer participation, Google has donated over $1.25 million to Defy, along with plenty of vital equipment like smartphones.

Like 'The Shawshank Redemption'

A paying job is a key ingredient to the success of a former prisoner, but having a record is a big barrier to employment. Gregory Bonds discovered this himself, as he told CNBC he was rejected from potential employment 25 times before launching his own business after graduating from Defy's program.

Bonds summed up the ex-offender employment problem with an anecdote from "The Shawshank Redemption," the 1994 drama set in a tough prison.

"An old man didn't want to get out of jail, so he committed a crime. I cried in my heart when I saw that because it hurt to know that someone was so hopeless," Bonds said.

Gregory Bonds kept pushing, enduring numerous pitch rounds through Defy's competition, where he won the top prize — a $15,000 grant for his business. He ultimately launched his business called Project Tradeshow, which designs marketing displays and graphics.

Some Defy Ventures alumni, like Coss Marte who founded the fitness bootcamp ConBody, have been able to make use of Defy's incubator to raise seed money. Hoke told CNBC that more success stories like these are sure to follow.

Defy recently launched in three new locations, and has a 15-year goal to establish a presence "in every major prison in the United States. We will be serving in every post-release city as well," Hoke added.


Disclaimer: CNBC owns the exclusive off-network cable rights to "Shark Tank."