#StartupsEverywhere Profile: Eli Rivera, Co-Founder & CEO, The Way Out
This profile is part of #StartupsEverywhere, an ongoing series highlighting startup leaders in ecosystems across the country. This interview has been edited for length, content, and clarity.
Providing Justice-Impacted People with Fair Chance Employment
The Way Out offers a fresh start to people impacted by the justice system by connecting them with employers through an unbiased selection process. We heard from Co-Founder and CEO Eli Rivera on how his background and young adult life prepared him to serve in this space, the ways that policymakers can prevent recidivism and encourage entrepreneurship among justice-impacted individuals, and how his business has been impacted by a patchwork of varying state privacy laws.
Tell us about your background. What led you to create The Way Out?
I was born in Milwaukee, Wisconsin as a first generation Puerto Rican. My grandmother and mother came here to seek a better life and ended up settling in inner city Milwaukee, where I was exposed to the onset of both the AIDS and crack epidemics in our neighborhoods. Being brought up in that environment and being exposed to those kinds of things definitely had an impact on both my self-esteem as well as the personal choices I made. Upon completing high school, I attended the university here in Milwaukee. I started struggling financially in school, and what started as a small operation growing and selling marijuana eventually turned into me going away to federal prison for a couple of years. Upon my release, I went back into the hospitality industry where I had spent time early on. Several years later I met my second wife, an educator at the university I had attended. She started bringing me in to speak about my journey and experience growing up in poverty, and it was through that process that I understood that there was an ecosystem out there and realized that's what I want to be a part of for the rest of my life.
Fast forward to 2019, and a local accelerator held an event on recidivism and I was asked to come up with ideas to fight it. That was the birth of The Way Out, and I subsequently met my business partner and co-founder, Ruben Gaona, who had been working in the social services space after his incarceration. So he was able to incorporate his unique perspective into the technology as well.
How does The Way Out work?
The Way Out is breaking the cycle of incarceration through technology and living wage jobs. The first part of our service is offering employers that are 100 percent committed to hiring justice-impacted folks, and who are not just paying performative lip service, a platform to recruit them . That's important because we're also asking our job seekers to be very transparent in sharing their history of offenses. So we've created a safe space for that. The other significant part of what we do occurs as the job seeker is creating their profile, because we're also finding out what additional supportive services we need to connect them to. Part of our goal is to ensure that a person has all of their basic needs first, then help them find employment. So that's what the onboarding process looks like: connecting justice-impacted job seekers with a fair chance employer and identifying their offenses ahead of time under a cloaked profile. Nobody knows who the employer is and no one knows who the applicant is until the employer commits to interviewing that individual. Once they do that, the cloak is dropped and they have all of their contact information and full resume to conduct their due diligence process with the individual. Then, should that turn into an employment opportunity, there’s a third line of what we do, which is providing access to a network that includes workforce development boards and reentry-focused organizations that provide additional services. Our algorithms work to identify who would be the best support partner for an individual, and when they’re matched, they then work to provide any additional services needed.
How can policymakers make entrepreneurship a more viable pathway for justice-impacted people?
From a funding perspective, just being Latino drops me down into receiving 2 to 3 percent of overall VC funding. And that percentage drops even lower when you’re a felon. So that has been challenging. But for our company, we had always intended to look for a VC who really understood the space we’re in (so either Latino or Black-centered funding sources). And that's exactly what happened here in Milwaukee—we were able to get seed funding from Google’s Latino Founders Fund and then additional funding from Dana Guthrie at Gateway Capital. I think the message here is that support for Black- and brown-managed or led funds would be huge.
This difficult journey has a tremendous upside—we’ll open so many doors for other people in similar situations. So we take that very seriously. There's the platform and technical side of what we do, and then there's the big picture of what our mission means for justice-impacted individuals and how we can shape the narrative that society has about people like us. In 2022, I was invited to be part of a legislative study committee on improving offender employment opportunities. Just being in that room and being able to provide feedback for those six months as we were discussing policy was a huge deal—and then coming out of that process with five bills that have started making their way to the floor, was amazing. And now, we’re seeing how those bills are helping to open up an understaffed Department of Corrections to external reentry service providers, like those we work with. So I’m in favor of inviting those closest to the issues you’re trying to address into the room and having more and more people like me involved in the legislative process.
A lot of workplaces are facing talent shortages right now—how do we get justice-impacted individuals the training, skills, and the support that they need to get back into the workforce?
It's currently a challenging environment out there, and tech’s a great example. There are a lot of good opportunities around upskilling and teaching people technical skills. But when we present the folks that we work with to some of these companies, they require years of working experience. So no matter the amount of skills a person has, unless they went away and already had extensive experience, more often than not they’re passed over.
One of the biggest problems we're having as it relates to folks who do have the skills, experience, references, and everything else needed for a job, is that those with lesser offenses are still being overlooked. And so most of these people end up in the manufacturing field. Recently, we’ve been pleasantly surprised at the interest we’ve gotten from employers in healthcare. So now that’s a space in which we're looking to partner with some larger organizations while also working with folks whose offense may be a barrier to entry.
In terms of incentives for employers, there are Work Opportunity Tax Credits and other programs out there, but there are two issues: 1) employers don’t know about the programs available to them, and 2) the employers who are aware tend to think that’s just extra work for HR, and they don’t have the capacity to take part. So they care less about incentives and more about getting people in the door.
What impact have patchworks of varying state laws—in data privacy and elsewhere— had on The Way Out?
Ensuring we’re compliant is really important for us, especially as we look to launch nationally. Currently, everything we do is in Wisconsin, which has cost us some money to make sure that we're compliant at the state level. Part of our pitch to the next round of investors is about how heavily the burden of compliance across all states is going to impact us. It’s a huge budget item as you look forward to scaling at the national level and we would be in a much better position to scale if there were, for example, a uniform policy on data privacy that covers the entire U.S. It's definitely a major issue today, and it's going to be an even greater issue as we move forward to other states.
What are your goals for The Way Out moving forward?
We’d like to get folks moved over to our updated platform and market more here in Wisconsin so that, eventually, we can go national. That's step one, and then in the long term I would be lying if I said I didn't seek the opportunity to have an exit one day. After the exit, the goal for us is to be the guys writing those investment checks to others one day—everything in between is part of the journey.
All of the information in this profile was accurate at the date and time of publication.
Engine works to ensure that policymakers look for insight from the startup ecosystem when they are considering programs and legislation that affect entrepreneurs. Together, our voice is louder and more effective. Many of our lawmakers do not have first-hand experience with the country's thriving startup ecosystem, so it’s our job to amplify that perspective. To nominate a person, company, or organization to be featured in our #StartupsEverywhere series, email advocacy@engine.is.
