Bloomberg Línea — L’ATTITUDE Ventures recently closed its first institutional fund, raising over $100 million through a strategic anchor investment from JPMorgan Chase and initial investments from Trujillo Group and Bank of America, and which it plans to invest in start-ups with Latino founders with high growth potential.
Other key investors in the fund include UC Investments and MassMutual, Barclays, Royal Bank of Canada, Polaris Limited Partners (Oscar Muñoz), Cisco Investments through its Aspire Fund, Churchill, an affiliate of Nuveen, and Morgan Stanley.
Sol Trujillo, partner and CEO of L’ATTITUDE Ventures, told Bloomberg Linea that the fund was created “for one simple reason: The Latino cohort is the largest in the United States. According to census data, 80% of all net new businesses are being created by Latino entrepreneurs”.
Trujillo, who will invest between $250,000 and a few million dollars, depending on the size of the opportunity, the stage and its potential growth rate, said that 50% of all net new employeer-based businesses in the US are being created by Latino entrepreneurs, and have been for more than a decade.
And yet, Trujillo pointed out, Latino companies are the most under-invested in the US.
“According to a Bain & Company study in 2021, Latino-owned businesses receive less than 1% of funding from top venture capital and private equity investors, which makes no sense.”
According the fund’s website, “Latinos are the most entrepreneurial yet undercapitalized cohort in the US. By investing in Latino-owned businesses, we enable those entrepreneurs and businesses to reach their full potential while unlocking revenue growth in the US”.
Latino entrepreneurs in the US
Investing in the early growth of Latino-founded startups in the US promises a strong return on investment over the next 30 to 40 years at a minimum, he says. In addition, those companies will create jobs, produce wealth for their founders and employees, and have a real impact on the community.
“The US Latino population, which is broadening the country’s income base, is generating income equivalent to France’s GDP. Soon, it will be larger than that of most countries in the world outside of Japan, China, the US and Germany,” Trujillo said.
“Startups founded by Latinos and Latinas are willing to take risks and make sacrifices, and invest their personal capital. They are innovative in the creation of products and services, and they are customer-centric. They are prolific in creating new businesses in all sectors of the economy,” Trujillo said.
Their total economic output in 2019 was $2.7 billion - having generated $1 billion in incremental GDP between 2010 and 2019, according to the Bain Capital 2021 report.
“This new generation of Latinos represents the largest market since the baby boom generation, with GDP greater than most developed countries’ economies,” said Oscar Muñoz, former CEO and president of United Airlines, and a general partner of L’ATTITUDE Ventures, in the fund’s launch statement.
The Impact of L’ATTITUDE Ventures
L’ATTITUDE Ventures is a purpose-driven venture capital firm with a mission to transform the venture capital ecosystem for the new mainstream economy, driven by the Latino segment.
The fund’s goals, Trujillo explained, are to provide competitive returns for limited partners, provide capital to entrepreneurs who are prolific in driving economic growth, address the issue of wealth creation for the many versus the few, and make a positive community impact.
Gary Acosta, general partner and CEO of the National Association of Hispanic Real Estate Professionals (NAHREP) stated in a release, “With NAHREP, I have seen firsthand how Latino entrepreneurs can move the ball forward in terms of closing the homeownership and wealth gaps in America. It made perfect sense to me to join as a partner and bring NAHREP’s resources and all of my influential contacts in housing and finance to this new fund.”
For his part, Brian Moynihan, CEO of Bank of America, said: “Bank of America’s equity investment in L’ATTITUDE Ventures reinforces our ongoing efforts to address the persistent gap in access to growth capital and open more doors for startups led by diverse entrepreneurs”.
L’ATTITUDE Ventures offers several levels of assistance to Latino-owned businesses in the United States. The first is creating visibility for those companies in which L’ATTITUDE has invested, the second is derived through mentorship, and the third is with connections to companies and distribution channels for founders to grow their companies by shortening the cycle time to companies, thus shortening customer acquisition and distribution cycles.
In addition, the L’ATTITUDE Conference, held each September, creates a forum for founders to compete for up to $20 million in capital that L’ATTITUDE Ventures will invest during the cycle. In addition, the competition is a platform for startups to present themselves to other vetted potential investors.