How Latino Innovators Are Rewriting The Rules Of Venture Capital
The playbook for American success is being rewritten, line by line, in a language the old guard pretends not to understand. We are told the story of innovation is a single, monotonous tale, yet a statistical thunderclap echoes from a different quarter. From 2018 to 2023, the number of Latino-owned businesses in the United States did not inch forward; it surged by 44 percent.
A torrent of creation. Their revenue did not creep; it leaped by 36 percent, a figure that ought to make capital sit up and pay attention. These are the findings from Stanford’s meticulous accounting, a chronicle of a vast and accelerating economic force. And yet. The men who guard the gates of venture capital—they squint, they hesitate, they look for a reflection of themselves and, seeing none, they turn away.
It is a curious sort of blindness.
Nikki Barua, at the helm of Latinas in Tech, calls it what it is: pattern-matching. A sterile term for a deeply human failing. You invest in what looks familiar, what sounds familiar, what wears the same shoes and tells the same jokes. You invest in who you know, not who is most capable. This leaves the game-changers, the innovators working outside the accepted geographies of genius, to build their worlds with different tools.
Think of Joshe Ordonez, an Ecuadorian in Brooklyn. He did not build another social media app for dating. He built Airpals, an AI-powered shipping platform, a complex logistical engine born from a sharp, practical mind. A real problem, a real solution. He sees venture capital not as a prize to be won, but as a crowbar to pry open a stubborn door.
“It’s just a tool,” he says. Not a validation. Not a coronation. A tool.
This is the heart of the matter, the secret handshake that for so long has remained elusive. Laura Moreno Lucas of L'ATTITUDE Ventures speaks of the playbook, that slim, invisible volume of rules for accessing capital. It is a guide to networks, to conversations held in rooms most are never invited to enter.
Unlocking it has been the work. Not just building a brilliant company, but also learning to pick the lock on the private club. It is a dual burden, a tax on ingenuity. The effort that could be spent perfecting code or expanding a user base is instead spent deciphering the opaque rituals of finance. The result is a stark, almost laughable imbalance.
Between 2007 and 2017, a mere one percent of investments from top VC firms found its way to Latino-led startups. One percent. A rounding error for some, an entire universe of thwarted potential for others.
So the work continues, often without the jet fuel of venture funding. The businesses grow anyway, powered by a different kind of energy.
They are not waiting for permission or for an invitation that may never arrive. They are asking for the money, demanding it, and when that fails, they are finding other ways to build, to scale, to succeed on their own uncompromising terms. They are not a niche market or a special interest group; they are a central current in the American economy, a force that cannot be perpetually ignored.
The code compiles. The packages ship. The ledger, slowly, inexorably, begins to balance itself.
The world of venture capital, a realm where fortunes are made and lost with each calculated risk, has long been criticized for its lack of diversity. Despite the growing awareness of the importance of inclusivity, the industry --- dominated by a homogeneous group of investors, primarily white and male. This dearth of diverse perspectives can have far-reaching consequences, as it often leads to a narrow focus on familiar markets and entrepreneurs, rather than exploring innovative ideas from underrepresented groups.
Research has shown that diverse investment teams are more likely to identify and capitalize on opportunities that might otherwise be overlooked.
For instance, a study by Harvard Business Review found that venture capital firms with at least one female investor were more likely to invest in startups with female founders.
Similarly, firms with diverse investment teams were more likely to invest in startups that targeted diverse markets. By broadening their investment horizons, venture capital firms can tap into a wealth of untapped potential, driving growth and innovation in the process.
According to a report by Crunchbase, in 2020, female-founded startups received only 2. 3% of total venture capital funding, highlighting the need for greater diversity in the industry.
Efforts to increase diversity in venture capital are underway, with some firms actively seeking out diverse investment teams and entrepreneurs.
Other references and insights: Check hereIn recent years, Latino entrepreneurs have made major strides in the United States. From 2018 to 2023, Latino-owned businesses increased by 44%●●● ●●●