Latinitas Reports from SXSW 2017
We live in a time where Latinos are becoming a vital part of the commercial and business world. As consumers, we are causing advertisers to adjust their messages to fit our interests. As entrepreneurs, we are creating businesses at a rapid pace. However, it is proving to a be a challenge to expand our services throughout the country to include segments of the market where non-Latinos can also benefit from services.
The South by Southwest panelists at Latino Entrepreneurs’ Opportunities discussed how this opportunity can be beneficial to the diversification of the U.S. business world, but they also presented the current problems that need to be addressed in order to make this change a reality. “We’re great at starting companies, but we’re not great at making them grow,” said Phillip Pompa, the board of director from the Stanford Latino Entrepreneur Initiative.
“Being an entrepreneur is not all about your product or service, but leadership is also very important,” said Ed Valdez, Chief Innovation Officer of Momentus. Valdez explained how difficult it is to recruit individuals if you don’t believe in your own company. A major issue with the lack of growth is that the most common source of funding for Latinos is personal funds. If a person uses only personal funds and isn’t willing to get funds from outside sources, it makes the person seem doubtful, which makes possible collaborators think that one is expecting the company to fail.
“As a Latino I’ve been told my entire life that debt is a bad thing… and now, as a tech founder, I understand that’s not the case and that is how people grow companies,” said Marcos Cunha, founder and CEO of YouRoam Inc. Cunha continued to emphasize that the business world is all a matter of perspective. Rather than calling it debt, he says one should look at it as an investment. He believes that in order for people to grow companies on a national and global scale, entrepreneurs need to consider outside funding. Cunha admits that it takes a lot of work and entrepreneurs will encounter rejection, but they must endure and continue to believe in their vision.
Liz Arreaga, founder and partner of Mercury Mambo, further discussed the importance of funding and making sure that you know your numbers. “Sometimes you’ll be so caught up with all the other elements of creating your business you’ll forget to pay yourself,” she said. “Not including a way to pay yourself in your business plan is a sure way of emotionally, financially, and physically taking your company down.”
At this point in the panel, I realized that the entrepreneur world requires thick skin and a balance of independence and collaboration. This element of collaboration is where the major complication for Latinos is found given that entrepreneurs must network, but Latinos usually encounter a limited level of social capital — the idea that it’s not about what you know but also who you know.
According to Cunha, 94 percent of venture capitalists are men and, out of those, 78 percent are white. “If you look at the stats, Blacks, Hispanics, and women receiving venture capital funding is very low,” he said. This lack of opportunity is caused by the fact that these minority groups rarely know someone in the industry.
A Latino entrepreneur can have the service, the product and the business knowledge to compete nationwide, but his or her poor social capital will hinder their success.
This unfortunate truth made me wonder how someone who is one of these disenfranchised groups has succeeded as an entrepreneur does. I chose to ask Arreaga, given that her experience as a Latina included the intersectional struggle of being both an ethnic minority and a woman. What advice would a successful Latina entrepreneur entrepreneur give to other Latinas looking to be successful in the industry?
“I would advise them to get a mentor… and select one that really is in line to what they want to do, is running a good business, and that will spend time with her,” said Arreaga. “It’s as much important for a Latina to select that mentor as it is for that mentor to select her… and once you’re there, just shadow, shadow, shadow.”
Arreaga emphasized the importance of work ethic, observation, and listening. “Ask if you can just sit in a meeting in order to absorb all the information you can… and this is not a forever thing. Do it for a year or six months, but do it,” she said.
Latinos are making strides in the venture capital world and the speakers at this panel proved that there are already many admirable leaders that young entrepreneurs can look up to and even network with. One thing the speakers unanimously agreed on was that the opportunities are there. Even though there are social and economic disadvantages that must be addressed, none of them would encourage any prospective Latino entrepreneur to give up. Change can only be achieved if Latinos continue to take advantage of every opportunity.
About the Writer
Jose Silva Salmerón, also known as Antonio Salmerón, is a Content Producer at Latinitas and a senior at the University of Texas at Austin. He’s pursuing a degree in both Public Relations and Radio-Television-Film with a business foundations certificate. Aside from working and studying, Salmerón enjoys watching films, writing scripts and assisting on various personal and school related film projects. Follow him on Twitter, Facebook, and LinkedIn.
Persistence: The Struggles and Opportunities of a Latino Entrepreneur was originally published in Austin Startups on Medium, where people are continuing the conversation by highlighting and responding to this story.
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