Capital hunt challenge for Latinos
By Robert Mullins
Silicon Valley/San Jose Business Journal
Queen Isabela I of Spain originally rejected Christopher Columbus’ pitch for venture capital to fund his three-ship expedition in 1492. But after her accountant told her the amount requested was no more than what the kingdom would spend to entertain a visiting dignitary for a week, Isabela relented and gave Columbus 2,000 maravedis in A round funding.
Columbus’ trip lead to the discovery of the New World, generating an incalculable rate of return on Isabela’s original investment.
“Yes, the first venture capitalist was a Latina,” said Marcela Davison Aviles, of San Jose, founder of the Isabela Project, a program to give today’s Latino entrepreneurs a better chance at landing venture capital in Silicon Valley.
The project’s two-fold aim is to teach Latinos how to gain access to the VC world and to develop investment products that could help Latino startups grow.
Latino entrepreneurs have difficulty securing venture funding or other investment capital because, despite their growing numbers and economic clout, they have few connections to people in the clubby VC community, those in the Hispanic business community say. VC partners unfamiliar with Hispanic entrepreneurs are reluctant to fund a company that may sail off the edge of the business world. And there aren’t enough Queen Isabelas at those firms who can greenlight a fellow Latino’s expedition today.
“If we don’t engage this population to be part of the innovation economy, that is going to hurt California,” says Margarita Quihuis, a Mexican-American venture capitalist who is currently a Reuters Fellow at Stanford University studying innovative business financing.
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