2024 State of Latino Entrepreneurship (SOLE) Summit

Welcome and Introduction

• The speaker welcomes attendees to the ninth annual State of Latino Entrepreneurship (SOLE) Summit, highlighting the importance of the event for the Latino community.
• The speaker introduces Latino Business Action Network (LBAN), a Stanford University-based non-profit organization dedicated to empowering Latino entrepreneurship and growing the American economy.

LBAN's Focus and Ecosystem

• LBAN focuses on three key areas: research, business scaling programs, and building an ecosystem around Latino entrepreneurship.
• The speaker emphasizes the importance of the ecosystem, acknowledging the contributions of bankers, venture capitalists, mentors, supporters, and alumni of LBAN programs.

Personal Journey and Gratitude

• The speaker shares a personal story about his journey at Stanford University, highlighting the impact of the university on his life and the importance of spaces like Kasa Zapata and El Centro for underrepresented students.
• The speaker expresses gratitude to Professor Porras, the founder of LBAN, for his mentorship and the opportunity to contribute to the growth of Latino entrepreneurship.

SOLE Summit and its Impact

• The speaker, who has a background in high-tech and running large companies, describes his involvement with the Latino Entrepreneurship (SOLE) Summit. He emphasizes the importance of building a supportive ecosystem for Latino entrepreneurs.
• The SOLE Summit is a nine-year-old initiative that has hosted 16 cohorts of the business scaling program at Stanford. The program has resulted in a transformation of how the broader community views Latinos, showcasing their contributions as producers, builders, and job creators.

Alumni Network and Ecosystem Building

• The program has over 1,100 alumni across the country, with a strong presence in various cities like New York, Miami, Florida, and El Paso. These alumni are actively engaged in building their communities and spreading the entrepreneurial ecosystem.
• The SOLE Summit also focuses on creating networks of networks, bringing together banks, VC firms, and other ecosystem-building organizations. This collaborative effort aims to address the challenges faced by women, Black, and Latino entrepreneurs.

Acknowledgement of Sponsors and Supporters

• The speaker acknowledges the crucial role of corporate sponsors, particularly Bank of America, Wells Fargo, and other organizations that have supported the SOLE Summit. He highlights the contributions of individuals like Rael Gonzalez, Karen Chopra, Jenny Flores, and Ben Baralis.
• The speaker highlights the support of JP Morgan Chase in launching an accelerator program aimed at addressing the underfunding of Latino startups in the tech space.

Serna Foundation and Visionary Leadership

• The speaker acknowledges the Serna Foundation as a crucial partner, emphasizing their thought leadership in building an inclusive economy and their transformative impact on the organization's work.
• The speaker expresses gratitude to Professor Jerry Bas, the founder of the organization, for his visionary leadership and dedication to building a strong foundation for the Latino entrepreneurial ecosystem.

Introduction of Victor Adas and Richard Saller

• The speaker emphasizes the importance of recognizing visionary leaders like Professor Bas, who have the courage to see the world's problems and work tirelessly to create positive change.
• The speaker concludes by introducing Victor Adas, co-founder and chairman of the organization, and emphasizes the entrepreneurial spirit of the Latino community.
• Richard Saller, the 10th President of Stanford University, was introduced as a "valiant" individual who cares deeply about the Latino community and all communities.

Stanford's Commitment to Latino Entrepreneurship

• Saller previously served as the Provost at the University of Chicago and Dean of the School of Humanities and Sciences at Stanford.
• He expressed his pride in Stanford's association with the Elban Scaling Program, highlighting its contribution to constructive work and the leadership of Jerry and Victor.
• Saller emphasized the importance of Latino entrepreneurship to the US economy, citing the 5 million Latino-owned businesses generating over $800 billion annually.

Ninth Annual State of Latino Entrepreneurship Report

• He highlighted the Ninth Annual State of Latino Entrepreneurship Report, which explores opportunities and challenges faced by Latino entrepreneurs and provides valuable data for decision-making and policy development.
• Saller mentioned Stanford's commitment to supporting Latinos through initiatives like the Program in Chicano Latino Studies, El Centro Community Center, and research aimed at improving the lives of Latinos and all Americans.

Engagement and Conversation

• He encouraged attendees to engage in the program, including conversations with prominent alumni like Jose Feliciano, Julian Castro, and Miriam Rivera.
• George Foster, Stanford GSP Professor and Elban Co-Faculty Director, shared his expertise in entrepreneurship and sports management, highlighting his work with a large apparel company on productive partnerships.

Elban SLE and Stanford GSB Partnership

• The speaker discusses the partnership between Elban SLE and Stanford GSB, highlighting its mutually beneficial nature.
• The partnership involves collaboration in research, teaching, and program development.

Reciprocation and Collaboration

• The speaker emphasizes the importance of reciprocation in the partnership, with both parties contributing and benefiting.
• The speaker mentions specific examples of collaboration, such as the development of Latino-focused cases for GSB courses and the use of Elban survey data for research projects.

Personal Involvement and Broader Perspective

• The speaker describes their own involvement in the partnership, taking over the program from Paul Oya and bringing their expertise in entrepreneurship and global initiatives.
• The speaker highlights the importance of a broader perspective on entrepreneurship beyond Silicon Valley and the value of learning from diverse experiences.

Introduction of the Survey and Barbara's Role

• The speaker introduces the upcoming discussion about the survey, acknowledging Barbara's significant role in driving the initiative.
• The speaker, along with Jerry and Deb, has been working on a survey for the SOLE Summit.

Survey Findings and Insights

• The survey, conducted with Qualtrics, involved over 10,000 business owners, with a focus on 5,000 Latino-owned businesses and 5,000 Hispanic white-owned businesses.
• The survey found that Latino-owned businesses continue to outpace white-owned businesses in terms of revenue growth.
• This growth is attributed to the Latino population's higher birth rate and immigration, leading to a larger percentage of the population.

AI Adoption and "Latino Land"

• The survey also revealed that Latino-owned businesses have adopted AI technologies faster than other businesses.
• The speaker emphasizes that the adoption of AI is not uniform and varies depending on the entrepreneur's specific needs and goals.
• The speaker recommends reading the book "Latino Land" by an unnamed author.

2023 SOLE Summit Report and Key Findings

• The speaker begins by highlighting the positive reception of Maria Arana's book "Latino Land," emphasizing its importance in understanding a misunderstood community.
• The speaker then introduces the 2023 SOLE (State of Latino Entrepreneurship) Summit, focusing on the ninth annual report on Latino entrepreneurship.
• The report examines Latino entrepreneurship through three key groups: Latina-owned businesses, Tech-centric companies, and immigrant entrepreneurs.

Latina-Owned Businesses and Financing Challenges

• The report found that Latina entrepreneurs are actively seeking financing but face the lowest loan approval rates from banks.
• Latina-owned businesses are the most proactive in seeking financing for their businesses, with over one in three seeking financing in 2023.
• Despite their proactive approach, Latina-owned businesses face significant hurdles when it comes to financing, receiving the lowest loan approval rates from both local and national banks.

Tech-Centric Latino Businesses and Growth Challenges

• Tech-centric businesses owned by Latino entrepreneurs are experiencing significant revenue growth despite facing challenges like limited cash flow and the impact of the 2023 banking crisis.
• Tech-centric businesses owned by Latino entrepreneurs are thriving, with the highest growth rates in terms of revenue compared to other groups.
• Despite their growth, Tech-centric Latino-owned businesses face challenges such as limited liquidity and lack of financing, which limit their potential for further growth and scalability.

Latino Immigrant Entrepreneurs and Business Ownership

• Latino immigrant entrepreneurs dominate business ownership but have smaller businesses with slower growth rates compared to their US-born counterparts.
• Latino immigrant entrepreneurs dominate ownership of employer businesses, despite often owning smaller firms that grow at a slower rate. They own more than half of all Latino-owned businesses in America, compared to only 7% of white-owned businesses that are immigrant-owned.

Entrepreneurial Diversity and Challenges

• The report highlights the strong entrepreneurial engagement of Latinas, with 27% of Latina-owned businesses compared to 21% of white women-owned businesses.
• The speaker emphasizes the importance of understanding the unique challenges and opportunities faced by each group within the Latino entrepreneurial community.
• The research highlights the importance of understanding the diversity within the Latino entrepreneurial community, focusing on women-owned businesses, tech-centric firms, and immigrant entrepreneurs.

Accessing the Full Report and Panel Introduction

• The text encourages viewers to access the full report on the Stanford website for more detailed information on Latina-owned businesses, tech-centric firms, immigrant entrepreneurs, government contracting gaps among women-owned businesses, industry distributions, and the benefits and challenges of AI technology implementation.
• The text introduces a panel of Latina entrepreneurs: Sophia Stone, founder of Indie Tech, a company building collaboration hubs for large enterprises; Noraa Cadenas, founder of Supply Change Capital, an early-stage venture capital firm investing in healthier and regenerative food and egg systems; and Carla Savantes, owner of Border Apparel Laundry, an apparel manufacturing company with facilities in El Paso, Texas, and Torreon, Mexico.

Latina Entrepreneurship Success and Scaling

• The text emphasizes that Latinas are starting businesses faster and growing revenues faster than any other segment, highlighting the success of Latina entrepreneurs.
• The text encourages audience members who are business owners interested in scaling their companies to connect with the panelists and visit the Elban website.

Panel Member Success Stories

• Carla, representing a company that has been in business for almost 40 years, celebrates their ability to survive economic downturns, including the COVID-19 pandemic. They are also celebrating their expansion into new categories, diversification, and growth in both sales and clientele.
• Supply Change Capital, founded in late 2020, is celebrating the successful closing of their fund and the positive impact they have made on the companies and founders they have supported.
• A company that has recently received a patent for their AI technology is celebrating this achievement, especially since it has already been cited by prominent companies like SAP and McKinsey.

Celebrating Latina Businesses and the SOLE Summit

• The speaker is celebrating the presence of the attendees at the SOLE Summit, particularly the focus on Latina businesses and the opportunity to contribute to a better landscape for Latina entrepreneurs.
• Carla, representing Border Apparel, highlights their competitive advantage as a binational company with factories in Mexico and Texas. This allows them to offer clients the ability to position products at different price points for different markets.

Border Apparel's Competitive Advantages

• Border Apparel benefits from the shift towards near-shoring and on-shoring, as they can offer shorter lead times and faster production cycles compared to overseas manufacturing.
• Border Apparel's commitment to sourcing materials from the United States and Mexico through USMCA agreements allows them to offer competitive pricing and support local economies.

Expanding Categories and Latina Representation in Venture Capital

• Expanding Categories: The speaker discusses the importance of expanding product categories to adapt to changing market demands. They use their company as an example, highlighting their ability to cater to both lower-priced and premium brands through their operations in Mexico and the United States.
• Latina Representation in Venture Capital: Normet, a Latina check writer, emphasizes the limited representation of Latinas in venture capital. She highlights that the number of Latina General Partners (GPs) is significantly low, with only around 40 in the entire ecosystem.

Diversity in Venture Capital Portfolios and Challenges in Accessing Capital

• Diversity in Venture Capital Portfolios: Normet argues that the portfolios of Latina GPs tend to exhibit increased diversity. She believes that Latinas bring valuable perspectives and expertise to decision-making processes, contributing to long-term success.
• Challenges in Accessing Capital: Sophia, a Latina entrepreneur, shares her experience of facing challenges in accessing capital. She highlights the need to be scrappy and persistent, as the bar for securing funding often shifts. She mentions that despite achieving milestones like patents, a strong team, and product development, she still faces hurdles in securing traditional venture capital.

Alternative Funding Sources and Shifting Bar for Success

• Alternative Funding Sources: Sophia emphasizes the importance of exploring alternative funding sources, such as grants and partnerships, to overcome the limitations of traditional venture capital. She highlights her success in securing a grant from Microsoft and closing contracts with reputable companies.
• The speaker argues that there is no pipeline issue for Latino entrepreneurs, but rather a constantly shifting bar for success.
• They highlight the frustration of founders facing increasing demands for revenue, usage data, and profitability, even at early stages.

Challenging the System and Cultural Norms

• The speaker emphasizes the need to challenge the system and ensure that the bar for success is not unfairly raised for Latino founders.
• Carla, a Latina entrepreneur in the male-dominated manufacturing industry, shares her experience navigating cultural norms and proving herself in both Mexico and the United States.

Internal Resilience and Fresh Perspectives

• Carla emphasizes the importance of internal resilience and proving oneself through hard work and dedication, especially in a family-owned business where she is both a woman and the daughter of the founder.
• Carla highlights the need to bring a fresh perspective to established businesses, using her example of expanding Border's product line beyond denim.

Importance of Hard Work, Passion, and Mentorship

• The speaker, a Latina entrepreneur, discusses her journey of expanding her business beyond denim and into new categories, proving her capabilities and challenging stereotypes.
• She emphasizes the importance of hard work, passion, and having the facts to back up your claims.
• The speaker highlights the importance of mentorship, particularly from fathers to daughters, in opening doors to opportunities and fostering the next generation of female leaders.

Diversity in Venture Capital Portfolios and Personal Story

• Arthur, a venture capitalist, emphasizes the importance of diversity in his portfolio companies, achieving this through accessibility, visibility, and a conscious effort to evaluate founders based on merit rather than a specific mandate.
• Arthur shares his personal story of being introduced to engineering and MIT, highlighting the impact of mentorship and the need to bring diverse individuals into the world of venture capital.

Supplier Diversity Concerns and Procurement System Improvements

• Sophia, a Latina entrepreneur, expresses her belief that supplier diversity is broken and that the current climate is creating excuses for corporations to step away from supporting minority-owned businesses.
• Sophia raises concerns about the impact of this trend on both her own business and the broader landscape of minority-owned businesses seeking to supply corporations.
• Procurement and Supplier Diversity Programs Need Improvement: The speakers highlight the need for a shift away from outdated procurement systems and Supplier Diversity programs that rely on databases with inaccurate data. They advocate for direct interaction with buyers and emphasize the importance of performance scores to showcase the value of Latino-owned businesses.

Connecting Businesses with Buyers and DEI Repositioning

• The Importance of Positioning Businesses in Front of Buyers: The speakers emphasize the need to connect Latino-owned businesses with potential buyers, highlighting the significant opportunity for corporations to tap into this diverse pool of entrepreneurs.
• The Impact of DEI Repositioning: The speakers discuss the current climate of DEI initiatives being under attack, with organizations either abandoning their efforts or rebranding them. They express concern about the potential consequences of this shift, particularly for organizations that rely on DEI-focused funding.

Fearless Fund Lawsuit and Resilience of Latina Entrepreneurs

• The Fearless Fund Lawsuit and its Implications: The speakers reference the lawsuit against Fearless Fund, a venture capital firm that provides grants to Black female entrepreneurs, and discuss the potential for a backlash against DEI initiatives. They highlight the impact this could have on future funding for minority-owned businesses.
• Resilience and Hard Work as Key Attributes: The speakers emphasize the resilience and hard work of Latina entrepreneurs, highlighting these qualities as key reasons why individuals should invest in or do business with them. They encourage attendees to recognize and celebrate the unique attributes of Latina entrepreneurs.

Jose Ficano's Entrepreneurial Journey and Irrational Belief

• The speaker, John, introduces Jose Ficano, a graduate of Stanford Business School and co-founder of Clear Lake Capital, a successful private equity firm.
• Jose shares his entrepreneurial journey, highlighting his belief that every entrepreneur needs an "irrational belief" in their ability to do something better.

Clear Lake Capital's Success and Resilience

• He explains that his firm's success stemmed from a unique approach to private equity, combining sector expertise in tech and industrials with the ability to invest across economic cycles.
• Jose acknowledges that his initial idea was met with skepticism, with some investors dismissing his strategy as unrealistic.
• Despite the initial challenges, Jose and his team persevered, proving their doubters wrong and building a successful firm.
• Jose also discusses the importance of resilience and the inevitable low points that entrepreneurs face, emphasizing that success is not always linear.

Navigating the Great Financial Recession and Clear Lake's Strategy

• The speaker, who is a private equity investor, describes the low point of his business during the Great Financial Recession.
• He explains that his firm, Clear Lake, was in the process of raising its first institutional fund in 2008 when the financial crisis hit.
• The speaker notes that it was a difficult time to raise capital, and they were only able to secure a small amount of funding.
• He describes March 2009 as the trough of the market, and at that point, it was unclear if Clear Lake would survive.

Perseverance, Support, and Lessons Learned

• The speaker credits his perseverance, support from loved ones like Kwanza, and his previous experience as an entrepreneur and investor for helping him through this difficult period.
• He emphasizes the importance of self-reflection and challenging one's strategy during times of crisis.
• The speaker highlights that Clear Lake's strategy was designed to capitalize on market downturns, and they were able to invest a significant portion of their capital during this period.
• He acknowledges that their success was partly due to a degree of naivety and a belief that they could buy "dollars at 50 cents."
• The speaker also mentions that lessons learned from his previous dot-com experience, which involved a period of failure, were helpful in navigating the financial crisis.

Miriam's Experience and Representation in Private Equity

• The speaker, Miriam, shares her experience of starting a fund and facing challenges in raising capital. She emphasizes the importance of learning from both professional and personal experiences.
• Miriam acknowledges the significant growth of Latino entrepreneurship in the US, but highlights the limited representation of Latinos in private equity and asset management.

Role Model, Performance, and Storytelling

• She sees herself as a role model for aspiring investors, recognizing the responsibility that comes with her success. Miriam believes that performance is crucial for building trust and overcoming unconscious bias in the industry.
• Miriam emphasizes the importance of visibility and storytelling for underrepresented communities. She believes that sharing her journey can inspire others and challenge limiting beliefs.

Self-Belief and Overcoming Imposter Syndrome

• Miriam highlights the importance of self-belief and overcoming imposter syndrome. She encourages others to push their limits and pursue ambitious goals, even when facing doubt and uncertainty.
• The speaker believes that representation is important for aspiring entrepreneurs, especially for underrepresented groups. Seeing successful individuals who look like them can inspire and motivate others.

Investment Considerations and Opportunities

• The speaker emphasizes the importance of understanding a company's sector and valuation when making investments.
• They also highlight the need for a unique value proposition or differentiation point that sets a company apart from its competitors.
• The speaker believes that underrepresented minorities and women in the investment management industry are often overlooked despite their potential for strong returns.
• They point out that these groups receive a disproportionately small amount of capital compared to their performance, creating an opportunity for investors.

Scaling Businesses and Ownership

• The speaker suggests that entrepreneurs should be open to taking on debt and bringing in partners as necessary for scaling their businesses.
• Focus on Ownership: The speaker emphasizes the importance of owning your business and intellectual property (IP) for Latino entrepreneurs. He encourages them to think beyond service businesses and explore opportunities to own assets that generate long-term revenue.

Data as an Asset and Effective Communication

• Data as an Asset: He highlights the value of data in today's world, particularly with the rise of AI. Even service businesses can generate data that can be leveraged for future growth.
• Communicate Your Idea Effectively: The speaker uses the "vanilla ice cream problem" analogy to illustrate the importance of packaging your business idea in a way that is easily understood and relatable to investors. He emphasizes the need to find a familiar pattern that resonates with investors, who are often looking for proven success models.

Sports as an Investment Opportunity and Chelsea Football Club Example

• Sports as an Investment Opportunity: The speaker discusses the potential of sports as an investment area, particularly in light of the changing business models in the industry. He compares the shift from license-based to subscription-based revenue models in software to the potential for similar changes in sports.
• Chelsea Football Club Example: The speaker uses his own experience with Chelsea Football Club as an example of how to gain a foothold in the sports industry. He acknowledges that buying a team is the most direct way to get involved, but also highlights the potential for growth and change within the sports industry.

Transformation of the Sports Industry and Change Agents

• The speaker discusses the transformation of the sports industry, particularly in football, from a business with a small percentage of predictable revenue to one with a large majority of revenue locked in through multi-year contracts. This shift has attracted significant institutional capital.
• The speaker highlights the appeal of owning a sports team, noting that even if someone isn't a skilled player, they can still buy their way onto the board.
• The speaker emphasizes the importance of individuals being change agents and role models in their communities. They encourage attendees to leverage the network created by the program and to not be discouraged by setbacks.

Failure as a Step Towards Success and Acknowledgement of Founding Members

• The speaker shares their own experiences with failure and encourages perseverance, emphasizing that finding out what doesn't work is a step towards success.
• The speaker concludes by acknowledging the attendees and introducing the original founding members of the Elban group.
• The speaker acknowledges the contributions of Phil Poma, Bill Puma, Frank Ramz, Julia Sullivan, and Richard Lissa in establishing the organization.

Call to Action and Concrete Steps

• The speaker emphasizes the importance of taking action and not just passively consuming information.
• The speaker encourages attendees to reflect on the information presented and identify one key takeaway.
• The speaker suggests that attendees consider what small, concrete action they can take to promote the positive aspects of Latino entrepreneurship or address barriers they have learned about.

Examples of Actionable Steps

• The speaker provides examples of actions that attendees can take based on their profession, such as:
  • Bankers can promote increased lending to Latinos.
  • Capital providers can actively seek out Latino businesses to invest in.
  • Government officials can influence policies or laws that support Latino-owned businesses.

Collective Action and Future Potential

• The speaker emphasizes that these actions need not be large-scale but should be concrete and committed to.
• The speaker encourages attendees to take action to promote Latino businesses, regardless of their role.
  • Employed individuals can influence procurement processes in their companies to favor Latino businesses.
  • Nonprofit leaders can promote Latino businesses within their communities.
  • Business owners can prioritize working with other Latino businesses.
• The speaker emphasizes the importance of collective action, stating that even small individual efforts can have a significant impact on the success of Latino businesses.
• The speaker highlights the future potential of Latino businesses to drive the success of the US economy.

Gratitude and Conclusion

• The speaker expresses gratitude to the speakers and organizers of the SOLE Summit, including:
  • President of Stanford University
  • Dean Lev
  • Trustee Jose Feliciano
  • CEO Uro Kasad
  • Co-Chair Jennifer Garcia
  • Nora May
  • Sophie
  • Carda faculty sponsor George Foster
  • SOLE research Barb
  • Visionary Jerry Porras
  • Former CEO of ELB Mark Madrid
  • The SOLE team, including Aruru, Jennifer, Elan, Maran, Alejandra, Lucia, Anelisa, and Carlos.
• The speaker concludes by emphasizing the power of Latino entrepreneurship and its contribution to the US economy.