Daniel Navarro, the visible face of the Google for Startups project, says that he is fulfilling one of his personal and work goals: "Providing access and opportunities to founders who are going to make a better world. And I think we are supporting this... nothing excites me more than the idea of what can be invented when the right person has the right tool to do it."
In an exclusive dialogue with LPO, Navarro tells us how the idea of launching (this year) the Latino Founders Fund within the Google for Startups project arose, something that had already been in place since 2011.
The initiative, directly focused on small Latino entrepreneurs, financed 51 companies through checks for $100,000 each plus $100,000 in Google Cloud credits. They were mostly located in New York, Florida, Texas, California and Chicago. The 2023 edition has not yet been launched and news is expected for February next year.
The difference in this case with other kinds of financing is that the entrepreneur who receives it does not have to give part of his/her share capital as a counterpart. And in addition to the amount that Google contributes, the company gives 1 million dollars for organizations that have a community of entrepreneurs that help the "founders" of Latino companies.
But Navarro's story at Google and his relationship with the Latino community did not start overnight. Born and raised in an immigrant area of Eastern Washington, Navarro began his career in 2010 when he arrived in Silicon Valley to join Google.
At that early moment in his career, he was in sales and decided to create a small group called "Hola" (hello) among Latino employees of the company to support each other and have more things in common. He recalls they were four or five people. Now they are 7,000 people in that community, they work in the company's offices globally.
"Coming to Google was an eye-opener for me. I saw an opportunity for technology to help people, and then to see technology completely change the direction of people's economy. That excited me," the head of marketing at Google for Startups says.
How did the idea of launching a fund that supports Latino entrepreneurs come about?
It is something that excited us very much this year. We launched it to level the playing field and give entrepreneurs who have very little access to the market a chance. Our focus is there. If you take a look at how we can help, what we can do is to give them access to capital. Beyond the fact that Hispanics are 20% of the population in the US, a tiny percentage of Latino startups manage to finance themselves. This is what we want to change.
That blocks them from growing in business, it disables them from generating wealth and ultimately they cannot be successful in business. Especially where there is a great opportunity for growth.
How does this financing for entrepreneurs impact the Latin economy? What do the founders you support say?
The first thing we want to do is help create wealth in the Latino community. Give them the opportunities to launch their companies and create jobs. The first thing our founders tell us they are doing with our funding is creating jobs. And they are very likely to hire Latino employees. Because they are the closest to them.
The second thing is that it does not only impact Latino startups. It benefits American consumers because many companies gain access to a market by speaking Spanish. For example: there is a case in Chicago, a Luis SuĆ”rez startup called Sanarai. It is a mental health platform in Spanish. It hires therapists to provide this service to Latinos in the US who cannot access treatment because there are few Spanish speaking therapists. The effect transcends the country. For example, he has hired therapists in Mexico City.
What requirements do you ask for to start analyzing the potential beneficiaries of the fund for entrepreneurs?
There are a few things: one, that they have raised less than $3 million in funding the year they apply. The reason for this is that we want to support founders who are starting their startup and not make it another check for them.
The second thing is that they have a way to show us that they will have profits going forward, such as active users, sales. Something that shows us that not only is it a good idea for us to finance them, but also that consumers are interested in what they offer.
Another requirement is that we see Google is necessary to help them and not end up being just another check to be cashed. Because in addition to the $100,000 we give in cash, the entrepreneurs have Google's employees support. We ask them how we can help their business. It is a community.
What happens to entrepreneurs and their companies after being chosen by Google?
Something we learned is that after Google, two things happen. One is that the founders can raise capital because they go to investors and say "Hey, Google supported my startup, we are legit." Having our support helps the companies. In addition, it serves to attract employees and new users. We think this program is not the final solution, but rather a catalyst for them to walk the next step.
What sectors do you finance? Which ones are you most interested in supporting?
We are agnostics on that. But I could say that we look for companies where Google can be very useful. And, obviously, we pay attention to the trends in the market: which ones are being launched now. For example, with COVID, there were many technology startups in the health sector. Many were Latin. One of the companies is ConnectCareHero, a platform that helps older people to connect with each other.
It is not coincidence that these kind of healthcare tech companies are appearing. But if I have to define sectors, I would say health and e-commerce companies as well. The important thing is that we want them to use technology to grow their businesses.
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