Latino Startups to Watch in 2014

In this third post in a series on Latino startups, Oxford SBS Seed Fund co-founder Mark Hand highlights the Latino market startups on the path to startup success. Check out the first and the second posts in the series, too.

When Peter Wilkins of New Futuro set out to raise a round of venture capital this year, he found very few investors that understood his target market: US Hispanics. In the VC community, he still says, "there is no one that I know of focused on Hispanic market companies."

That lack of understanding on the part of investors hasn’t slowed down New Futuro. Through its events, resources, and online community, New Futuro now provides educational advice and material it says reaches millions of Hispanics every year. In the footsteps of companies such as HolaDoctor, Xoom, Progreso Financiero, and Consorte Media, New Futuro is part of a new crop of Latino market startups that are raising cash, building teams, and charging into the Latino market.

The most active sector for Latino market startups is financial services. Regalii, led by Wharton MBA and Echoing Green Fellow Edrizio de la Cruz, follows in the footsteps of iSend in allowing families to have some a say in the spending of remittances. Currently in beta launch according to its website, Bucks Bill Pay allows customers to pay their bills in cash at local agents. And Juntos Finanzas, a product of Stanford d.school, empowers Latino customers to track their own expenditures by SMS, similar to India-based social enterprise InVenture.

Along with New Futuro, another crop of Latino market startups focuses on education: YogoMe is an educational app with plans to move into language learning. Backed by 500 Mexico City (which announced its new batch of startups just last week), YogoMe is one example of how companies are pulling in resources from both American and Mexican startup ecosystems. Sleek-geek has three educational tablet apps for teachers, and is one of seven companies in the first Manos Accelerator cohort that includes Antonio Altamirano's Interesante. Plaza Familia is another educational venture founded by Latino social media veteran Ana Roca Castro.

Beyond financial services and education, immigration services platform LexSpot has raised over half of its $750,000 convertible seed round. YaSabe, another 500 Startups portfolio company building a bilingual, local search engine, closed a $2.7M funding round in the first half of 2013. AssuredLabor, based in NYC and with operations in Brazil and Mexico, raised $5.5M earlier in 2013 to expand its job-seekers platform.

Keep an eye on these companies in 2014--no doubt at least one of them will soon stand with Xoom and others that have built successful businesses by serving a large and growing US Hispanic market.

Who did we miss? Let us know in the comments.

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A couple of notes: iSend is a portfolio company of Gray Ghost Ventures, Mark's former employer. Also, thanks to Barney Santos from Gentefy Media for his help in pulling this list together.

The State of Latino Startups: Exploring the Challenges

In this second post in a series on Latino startups, Oxford SBS Seed Fund co-founder Mark Hand explores some of the obstacles that Latino-run and Latino-focused startups face. Read the first post in the series here.

Startup struggles, generally speaking

If there is one topic that entrepreneurs love to talk about more than any other, it is be the trials and tribulations of being a founder. You work impossibly long hours; you wake up with cold sweats knowing that every moment you’re not working on your idea, your competitor is. You spend more time managing people than you do with the product that you wanted to build; you are constantly reminded by more ‘reasonable’ friends and family members that you are sacrificing prime earning years to chase a dream. Money is always in short supply, and no one--no one--can ever truly give you the peace of mind that you are doing it right.

In nearly one hundred conversations about Latino startups over the last eight months, I’ve also heard and identified a handful of other hurdles specific to Latino startups. Some of them are relevant to Latino founders; others are particular to startups whose primary customers are Latinos.

Latino founders' uphill fight for funding?

Latino founders, just like their non-Latino counterparts, point to the lack of high-risk capital as a significant barrier to the growth of Latino startups. Unlike in conversations with white founders, however, hints at racial bias among funders are pretty common in conversations with Latino founders. Few accuse venture capital investors of outright racism. Instead, they make two arguments. The first, voiced by at least one venture-funded entrepreneur, is that venture investors have the same subconscious racial bias that Chicago Booth researchers discovered among hiring managers in Boston and Chicago. Venture capital (VC) investors retort that if they see a strong team with a good idea in a growing market, they don’t care about someone’s race or country of origin. In fact, Silicon Valley is so dependent upon foreign talent that they now lobby ferociously for immigration reform.

The second, related argument is that the nature of many VC investors’ networks is such that black and Hispanic entrepreneurs are excluded not due to racial bias but because of the nature of social networks. In a recent conversation about the opportunity for a Latino-focused startup fund, one VC asked me if I was saying all VCs were racist. “No,” I said, “We’re lazy.” When some VCs proudly trumpet that a resourceful entrepreneur will find the right introduction to them, they are trusting their network to complete the first round of vetting of potential startups. In the aggregate, such a closed-network approach to deal-sourcing means out-of-network ideas are shut out until someone (a “broker” in network theory) connects them.

Before they approach VCs for scale-up funding, however, Latino founders point to another gap in funding. Unlike founders from well-connected, wealthy backgrounds, Latino founders have fewer wealthy friends and family members waiting in the wings to pump $20,000 into their startup. One Latina founder told me that, as the most educated and successful member of her extended family, asking her family for money would be laughable; instead, she is expected to be the one with a steady job providing cushion for everyone else. In this way, Latina founders, already carrying much of the weight of the growing Latino startup community, may be loaded down even more than their male counterparts by familial expectations. 

The Latino market: large, nuanced, tough

What of startups that are not run by Latinos but focus on the Latino market? They too, face special struggles both in financing and execution. In seeking financing from VCs, Latino market startups struggle to get attention from investors rightly inclined to fund what they already know--e.g. tech, life sciences, solar, mass market retail, defense. Why educate yourself on a new, unproven market, exposing yourself to even greater risk? The answer, of course, is that not only are Latinos a large and growing group of upwardly mobile young consumers, but they are early adopters of new technologies and bellwethers for shifts in consumer trends; but as Antonio Altamirano points out, this case has yet to be made in a clear and compelling way.

Even given funding, Latino-focused startups face a special challenge: the Latino market may be huge, but it is incredibly nuanced and diverse. Most obviously, Latino market startups have to balance the needs of English-dominant and Spanish-dominant customers; the fluently bilingual customer support and content creators required to do this are tough to find and harder to retain.

Yet both Latino founders and those interested in the Hispanic market are plowing ahead. One example of such forward momentum is Manos Accelerator, which has recently accepted their first cohort of Latino startups. In our next article, we’ll take a closer look at a few of the Latinos and Latino-focused entrepreneurs blazing the trail--if you know of a few, send them our way!

Mark Hand (@markchand) is the cofounder of the SBS Seed Fund, a student-run startup fund within Saïd Business School at the University of Oxford. He spent two years with Gray Ghost Ventures investing in early-stage companies in the US and India. Mark is currently researching startups in the US Hispanic market. Photo by Phil Roeder from Wikimedia Commons.

Crowdismo: Fueling Innovation and Creativity in the Latino Community through Crowdfunding

If the U.S. Hispanic market were a nation, it would boast one of the largest economies in the world with spending power of $1.2 trillion. The realities of today's Hispanic market are that of opportunity, motivation, aspiration, altruism, and hustle. The power and influence of the U.S. Latino collective is undeniable. Many awesome individuals and organizations from the West Coast to the East Coast are launching new ideas, connecting communities, and genuinely shaking the status quo. How can we build upon this momentum and continue to fuel innovative ideas and new opportunities throughout the U.S. Latino market? Enter Crowdismo. (Disclaimer: I'm a co-founder of Crowdismo and believer in bold possibility.)

Crowdismo is a disruptive platform aimed at powering creativity and innovation within the Latino community through crowdfunding. A digital destination and site for individuals to join a groundswell of people driven by inspired genius and help power the prolific. Our goal is to eliminate barriers to entry for gente with bold ideas. By tapping into the power of the crowd, Crowdismo connects you to awesome possibilities in the form of funding.

How it works:

1. Pitch your project to an online community of early adopters and believers.
2. Incentivize backers to pledge to your project with unique rewards.
3. Hit project’s funding goal and get one step closer to activating the incredible.

Age Factor
Overall, those between the ages of 25 and 34 are most likely to make investment decisions via crowdfunding platforms. The median age of Latinos is 27.6 making them the youngest demographic in the U.S. and perfectly aligned to adopt crowdfunding as a means of powering projects across a wide array of arenas including: Education, Technology, Social Impact, and Entrepreneurship to name a few.

Explosive Growth
"...the unassailable fact is that Latino-owned businesses in the United States are growing at a blistering pace." Latinos are three-times more likely to start businesses than the general population. Nielsen's State of the Hispanic Consumer report offers additional insights into the reach and growth of Latinos in America.

Philanthropic
Looking at Experian Simmons data, we know 47% of U.S. Hispanics donated to a charity or philanthropic organization in the last 12 months (Experian Simmons, Fall 2011 NHCS Adult Survey).

According to a recent post in Forbes online, "Sixty-nine percent of Hispanic respondents ranked “help people who are in need” as No. 5 on their list of aspirations compared to only 27% of non-Hispanics, who ranked this at No. 14. They want to make a difference, and if you can facilitate that, you can endear your brand to these consumers."

It's imperative that we foster a community of synergy and build both intellectual and financial capital driven by access to powerful economic resources that will enable continued momentum throughout the Latinosphere in the U.S. Crowdfunding levels the playing field in an arena where only 1% of VC money goes to African Americans and Latinos.

We're on the cusp of a unique opportunity to take investment and new venture priority to another level and Crowdismo is targeted at leading the charge in innovation funding, idea powering, and community impact.

Crowdismo coming soon 2013! Sign up for early access. Or join Crowdismo on Facebook.

Latino Startups to Watch in 2013

"Create a prototype and get it to market as soon as you can. Ignore the naysayers. Revise fast." - Guy Kawasaki, Author of The Art of the Start.

Perhaps it's this kind of a mindset that has led to a rising surge in entrepreneurship activity among Latinos. Hispanic entrepreneurs opened twice as many businesses as the national average in the 2000s, according to U.S. Census data. What's even more exciting is a trend where Latin American-born entrepreneurs, a previously invisible cohort, are beginning to make their presence known in Silicon Valley. Bet you didn't know that the co-founder of Instagram, Mike Krieger, is Brazilian. But where is the rest of the startup collective and what problems are they trying to solve?

To no surprise, Latino startups are rising in number and influence. Part of this explosive growth is fueled by Latinas who are vital to startup success. In fact, there are numerous success stories of Latinas who are making some big strides in entrepreneurship activity and blurring the lines of gender difference building huge momentum. And we love it.

Following are a few Latino(a) startups of note that we feel are sure to continue the upward trend in entrepreneurship activity in 2013 and fuel real impact across a multitude of industry verticals.

Parranda.org

A new online/offline community opened its virtual doors this morning with an invitation to all Puerto Ricans to help remap "The Greater Puerto Rico." Parranda.org -- which takes its name from the popular Puerto Rican Winter holiday pastime -- aims to "remap, remake, and remobilize the Greater Puerto Rico" through a series of coordinated efforts involving both people on the island and people in the Puerto Rican diaspora (i.e., people who have moved to the mainland US and other countries). The first focus for Parranda.org is a global project where the community will draw an interactive map of where Puerto Ricans live today. A first look at this map will be published in January.

Dubalu

Dubalu (Pronounced DOO-bah-loo) is the world’s first Social Network Marketing Site—a unique, exciting and valuable new concept in networking that combines the most popular features and benefits of the Internet’s top-ranked social and marketing destinations in one. What's interesting about this site is the fact that they've amassed a huge social media following in a matter of months. It will be exciting to see if Dubalu can capitalize on a subscription based model fueled by the power of social media.

StudentMentor.org

An innovative national mentoring program based on a pioneering technology platform where college students can conveniently find and collaborate with mentors from diverse industries and professions to achieve their academic and career goals. StudentMentor.org has amassed an audience of students from 1,000+ colleges and counting including a network professionals from all industries contributing 40,000+ years of experience is part of the reason the site has been able to partner with none other than the White House.


Latino Startup Alliance

Based out of San Francisco, the Latino Startup Alliance is leading the charge in new ideas. The mission of the LSA is to encourage the inspiration and cultivation of Latino led technology startup ventures by providing a strong support network of fellow Latino entrepreneurs, investors, innovators, and business owners. A hub of startup activity and leadership sure to thrive in 2013 and increase the amount of Latino led technology innovation not only in Silicon Valley but across the United States.

The breadth of Latino startup activity is fuel for the visionary and a symbol of opportunity. If you have an idea, forget about fear and move fast because the crowd is waiting, watching, and looking for opportunities to fuel innovation and power genius throughout the U.S. Here's to continued momentum and positive iteration in 2013!

The Muy Interesante Future of Latino Entrepreneurship

There's no denying it, minority entrepreneurship matters in the United States. And for the budding Latino business entrepreneur, embracing technology and social media is invaluable. When it comes to the future of Latino entrepreneurship, why not start them young with an innovative approach similar to SparkAmerica.us?

Better yet, why not learn from some of the most dynamic Latino entrepreneurs that are building interesting things and amassing a growing user base while developing innovative technologies.

Say hello to Interesante.

The place to discover and share Latino interests. Interesante is a unique startup in beta focused on immersive cultural shear-ability and fueling diaspora-driven commerce. It's a gateway to cultural interests in its most beautiful visual form. Interesante places a special focus on the deeper cultural nuances of social engagement commanding a user base representing over 41 countries including Argentina, the United States, Spain, Mexico, Colombia, Ecuador, Chile, Venezuela, Brazil, and Peru.

Interesante is the brain child of Rebecca Padnos Altamirano (CEO) who gracefully assembled a team of approximately ten individuals, largely based in Argentina.  These professionals are led by Antonio Altamirano (COO), Pablo Gamba (CTO), Claudio Cossio (VP Marketing), and Leandro Henflen (Design).  Antonio is also the co-founder of virtual postcard startup Dabble.

Our founder Jose Huitron, recently caught up with Antonio, one of the most prolific Latino entrepreneurs amassing a cross-national track record of unique startup activity.

Antonio arrived in the U.S. 13 years ago armed with a keen focus on the huge potential and possibility of entrepreneurship. "I needed to prepare myself to be the best I can be and be ready to launch and test my ideas in the real world. Not only by building a company but helping the community as a whole and in particular, the Latino community," said Antonio.

The allure of possibility combined with a passion for action has fueled an environment where Latinos are the future of entrepreneurship in the U.S. Latinos are now trendsetters, cultural icons, successful business people and are at the core of the American cultural fabric. However, no tool has placed the Latino consumer at the top of their pecking order. Enter Interesante.

"There are huge highs and massive lows. You go from a place where you feel you're going to conquer the world and some days it looks as if you are climbing Everest. Preparation is paramount to succeed in this environment. The fluctuation is so big you have to be careful, but that is what makes it fun." said Antonio.

"Other tools were born out of necessity for a particular need. Facebook doesn't even provide Open Graph in Spanish. We want to be the largest database of interests that are Latino based in the world.

For many budding Latino(a) entrepreneurs, the road to real impact requires a focus on identifying, enabling, and mobilizing champions and committed advisors. A real challenge lies in trying to bridge the gap between Latinos who want to do something big and Latinos in the U.S. who can invest and nurture the nascent Latino startup community. Interesante is a benchmark in how to bridge this gap and move inspired Latinos with bold ideas to a place where passion meets action.

Rebecca and her team at Interesante are a legitimate force to be reckoned with. They stand as a great example of an innovative startup that is built for Latinos by Latinos.

For Antonio and his team, Interesante is much more than a hub of diaspora-driven commerce. It is also a rallying cry for Latino entrepreneurs to step into the arena of innovation with confidence and a belief that your identity fuels the prolific.

The future of Latino entrepreneurship is already here.

The Coming Storm of Latino Startups Has Arrived

Where are all the Latino innovators? That's a popular question but the answers may be closer than they appear. There's a storm of Latino entrepreneurship activity happening in the U.S. and south of the border. Perhaps, the collectivist nature of Latinos may be a unique factor contributing to the somewhat quiet rise of startup dominance.

Hispanic entrepreneurs opened twice as many businesses as the national average in the 2000s, according to U.S. Census data. And recent data from the Kauffman Index of Entrepreneurial Activity highlights an interesting surge in entrepreneurship activity by Latinos.

The American dream is alive and well.  In 2010 immigrants accounted for nearly 30% of new business owners, versus 13% in 1996, according to the Kauffman Foundation. No matter how you cut it, Latinovators are enjoying their share of the entrepreneurship pie.

Of particular note, is the work of Jesse and Edwardo Martínez who founded the Latino Startup Alliance which was launched New Year’s Day 2012, now a budding network of over 240 innovators. However, the question remains. Where are the rest of the Latinopreneurs?

A mere 20 results show up for "US Hispanic Market" on AngelList which is the de facto standard for keeping tabs on the burgeoning startup arena in the U.S. and beyond. What does this mean? Perhaps, there's a ton of Latino startups listed on the site but are working under the radar with their profile hidden as they move close to launch or a point of desired product/service development. The truth? We need more Latino startups who are not afraid of their identity and the arena of possibility. Inc.com has its own list of Top Latino entrepreneurs who've achieved some striking marks of success and are actively blazing a trail of entrepreneurship activity.

There's no denying it, the Latino startup crowd is here and it's kind of a big deal capturing the attention of many, including some of Silicon Valley's most engaged venture capitalists as confirmed by the recent purchase of Mexican.vc by 500 Startups. If we look closely, there's something much bigger in the works. There's a real dynamic taking place where Latino innovators are playing the lead role in the U.S. and beyond.

And...it's only just beginning.