Latino-founded businesses are booming, yet less than 2 percent of Latino entrepreneurs ever make it past the $1 million revenue mark, according to the U.S. Census Bureau. Of the 1.4 million Latino-owned companies in the United States, the average has $156,000 in annual sales, revealed a study from the Latin Business Action Network (LBAN).
That's what makes the following group of Latino founders the ones to watch.
The Stanford Latino Entrepreneurship Initiative, a collaboration between Stanford University and LBAN, identified eight Latino founders generating well over $1 million in annual revenue or who have received at least $1 million in funding. All completed a Latino entrepreneurship program at Stanford as well.
Between 2007 and 2012, 86 percent of the growth in all small businesses could be attributed to Latino-owned businesses. Imagine what Latinos can do for business formation and job creation as more reach the success level of the eight founders on this list, provided exclusively to CNBC.
— By Claudine Hutton, special to CNBC.com
Posted 21 April 2016
If the global sports phenomenon of football is going to rival sports like the NFL and NBA in the United States, Cardenas may be among the most important players. Overseeing campaigns for companies, including American Airlines, Family Dollar and Fox Sports, his firm works on campaigns to develop football (aka soccer) marketing brands in America.
Coming from an entrepreneurial family and an engineering background, Cardenas first worked on capacity planning and supply chain for Hanes in Mexico. He transferred to the company's Winston-Salem headquarters as he pursued his MBA at Wake Forest, where a class project led him to the university's incubator. "For a year I worked at Hanes and at night doing the project as well," said Cardenas.
Soccer is a big focus, but the firm is not exclusively sports marketing. "When you're trying to reach Hispanics, soccer is an important part of the equation," he said. But he added, "Fifty percent of our business is about reaching the Hispanic consumer. ... We see a huge market here. ... We think there's a lot of room to grow with Hispanic marketing."
Birthplace: Sabinas, Mexico
Education: Monterrey Institute of Technology and Higher Education in Mexico; MBA from Wake Forest University
Company description: Charlotte, North Carolina-based AC&M Group helps brands reach and connect target consumers using cultural insights to develop a communications strategy. Specializes in brands that are trying to reach any of the multiple sub-segments of the Hispanic market, as well as soccer consumers.
Financials: $3.6 million in revenue
At one time or another, Cipriota has worked in most units of a tech company: business development, product development, fundraising and human resources. But it's her role as a founder of Funnely — which uses machine-learning algorithms to design marketing programs — that has provided the challenge the entrepreneur says she needed.
At Hewlett-Packard, Cipriota said she started feeling that she was limited in terms of not only the decision-making but also the percentage of what she was offering to the company. "I learned a lot; then I realized I could be doing more," said Cipriota. "I feel I can give 100 percent of myself at Funnely. ... All my energy comes from this."
Funnely started with "two girls and two boys."
"The boys were coding; the girls were selling the business," she said. "And we started getting clients, getting success. We quit our jobs."
She says that being a Latina in Silicon Valley has not been easy. "We need to work harder together ... than any other company" to show that a woman-led company can perform as well as "those led by the boys," or even better.
Birthplace: Buenos Aires, Argentina
Education: University of San Andrés
Company description: San Francisco-based Funnely is a data-driven platform that helps e-commerce marketers automate Facebook and Instagram ads and optimize ad-dollar allocation between lead generation and granular retargeting campaigns.
Financials: $1 million raised in seed round, expecting to close series A round of venture funding this year.
Lujan has been at the forefront of the new world of health insurance, helping to establish the California Health Benefit Exchange, now known as Covered California, which has enrolled 1.3 million residents.
Lujan has had what he calls "an accidental career in insurance." But he said that now, 30 years after accepting the first job offered out of college, there is a compelling reason to believe he ended up in the right place: "Obamacare gave me an opportunity to transform an old health-care system. … Technology was the next logical step," said Lujan. "The health insurance industry is woefully behind."
He has also long been a health-care policy wonk, an interest born out of personal experience. "Most of my childhood, I did not have coverage. I was a born advocate."
His advocacy is now dedicated to developing an integrated health-care system that serves consumers with wearables, health information and other "huge leaps of advancement in technology" down the road. Limelight Health is focused on the U.S. employee benefits market, but Lujan said requests for proposals have come in from Asia, Europe and other regions. "I'd love to see us become a billion-dollar company in the next three to five years. It's supported by the size of the opportunity."
Birthplace: Covina, California
Education: California State University, Northridge
Company description: San Francisco-based Limelight Health provides a mobile quoting platform for health insurance and related benefits for small- to mid-sized employers. Designed to support the new post–Affordable Care Act market.
Financials: $1.3 million in revenue
Meléndez is an engineer by natural aptitude, a lawyer by training, but a software entrepreneur by passion. He was a senior software engineer at Biometrics Imagineering, and before that a management consultant at Accenture, but he said, "I've always wanted my own business."
Being based in Puerto Rico, where all of the recent financial headlines are about the country's debt crisis, can make the challenges for an entrepreneur that much harder.
"As an entrepreneur, you need rules to be set," Meléndez said. "If I'm trying to grow by 30 percent to 40 percent and then the government decides it will put a new value-added tax or they are going to increase my taxes after I've set my prices and negotiated contracts, that makes things hard and very scary for us."
Meléndez admits he's considered leaving Puerto Rico. "Everybody here knows somebody who left. I have two sisters in the U.S. They are also saying you should come," Meléndez said.
But his determination as an entrepreneur flows over into his belief in Puerto Rico. "Somebody has to stay here to make this work and show the world we have great talent," he said.
Birthplace: San Juan, Puerto Rico
Education: University of Puerto Rico at Mayagüez; University of Puerto Rico School of Law
Company description: San Juan, Puerto Rico-based Wovenware is a software development and software engineering firm.
Financials: $2.4 million in revenue
Miranda ran several businesses in Brazil before moving to the United States 20 years ago. That entrepreneurial life — which included a daycare center and a pajamas manufacturer — required her to speak multiple languages and learn the ins-and-outs of several cultures. And that led to her current, and maybe best, idea of all. CQ fluency helps companies working across languages to communicate and culturally connect.
"We translate not only the words but what the words mean," said Miranda.
Cultural differences are communication keys. If there's a campaign telling people to eat healthy because health leads to wealth, she explains, it won't be very appealing for the average Latino person. "They will eat well because they want to be at their daughter's wedding instead of being so driven by money," she said.
CQ fluency recently worked on a program for diabetes originally intended for an English-speaking population. "They are talking about not having bacon and eggs, but Hispanics do not eat bacon and eggs for breakfast. You are telling them something totally irrelevant," she said.
"What we want to do is rise up the supply chain and talk to people as they begin the communications campaign and not as an afterthought," Miranda said.
Age: Declined to disclose
Birthplace: São Paulo, Brazil
Education: Montclair State University; Tuck School of Business at Dartmouth; Kellogg School of Management
Company description: Hackensack, New Jersey-based CQ fluency is a translation company that specializes in cultural adaptation communications for the health care and life science industries, in over 150 languages. It has found its biggest inroads in the health-care sector and has enjoyed triple-digit growth in the last five years.
Financials: $6.9 million in revenue
Rios is a competitor: She is a former NCAA tennis champion, All-American and national "Rookie of the Year" on the women's tennis circuit in 1998.
At pharmaceutical giants — including Allergan, maker of wrinkle-eraser Botox — Rios' competitive streak led to growing her sales territories to multimillion-dollar levels. But it was the Affordable Care Act that opened her eyes to a big opportunity.
She said that under Obamacare, general physicians started supplementing their incomes with cosmetic injections, and she saw some frightening things: patient after patient at risk of serious complications during injection procedures, even blindness. "I started asking why physicians were not trained in injections," Rios said. "Many ended up training on cash-paying patients who didn't realize they were guinea pigs."
"I sat my family down and said, 'Here's the deal. I'm seeing people get hurt. I'm going to sell my house, cash in my 401(k), and find a solution.'" I thought my mom would say I'm crazy. But she said, 'You've got to do it.'"
It hasn't been easy. Being a Latina has made fundraising "super difficult," Rios said. "You see a company like mine in discussions with top pharmaceuticals and you would think with all the metrics, you'd have funding really quickly, but as a Latina, I have to hit more hurdles than others."
TruInject, the first company to focus on an injection-training software for doctors, is first going after the Botox market but already has patents that cover any part of the body.
Birthplace: El Paso, Texas
Education: California Polytechnic University
Company description: Irvine, California-based TruInject created the first injection simulation system for doctors in the cosmetic surgery field, with an initial focus on facial aesthetics.
Financials: Raised $2.7 million in funding
What does it take to become a case study used by the Small Business Administration and be featured by Martha Stewart and The New York Times? A playful design aesthetic.
Siminovich is the creative force and founder of Petit Collage, a modern design company specializing in décor and playthings for babies and young children. Petit Collage products are sold at thousands of stores worldwide and appeal to the mass market and cultural elite: Barnes & Noble, Whole Foods and the San Francisco branch of the Museum of Modern Art.
She is also the author and illustrator of more than 30 books for children, and since her childhood in Buenos Aires, she has always defined work as entrepreneurial. "I was always an entrepreneur. I only had one job. My father was an entrepreneur. I always had a lot of drive."
The idea for Petit Collage came as a result of the only "real" job Siminovich ever had. She moved to New York in 2001 and found a job with a stationery and gifts company through a classified ad. "It was lovely. I worked with museums. That was my one job. It made me want to start my own company in gifts and toys, funny enough."
Birthplace: Buenos Aires
Education: Universidad de Buenos Aires
Company description: San Francisco-based Petit Collage is a design and décor company with a line of modern nursery wall décor and playthings.
Financials: Declined to disclose
Urias has always been close to power. "My grandfather was Phoenix's first Hispanic city council member. As a family, we've always been politically engaged," Urias said.
She worked for a Mexican Undersecretary of Energy and spent nine years marketing and managing water technology through USAID, the World Bank and the InterAmerican Development Bank. She serves on the boards of the Arizona Hispanic Chamber of Commerce and the Sandra Day O'Connor Institute.
But working in a corporate environment, she found herself unable to break the glass ceiling. "I was hitting the glass and getting a lot of headaches. I was frustrated and wanting to do more. My husband said, 'Go on your own.' … I took the risk, and I really do love it."
Urias started her own advertising and public relations agency, called Urias Communications. "I wanted an agency that was focused on the emerging multicultural markets of Arizona and the U.S. Southwest," she said. "I had very little experience with any agency that approaches it authentically."
By 2013, Urias wanted more. That's what led to the 2015 merger of her firm with government affairs firm Molera Alvarez to create CoNecs North America. The combined firm handles both corporate PR and lobbying on issues such as immigration and health care, in both the United States and Mexico.
"My role is the brand of Arizona. ... A border state may have challenges, but there is also a tremendous opportunity," Urias said. "There's tremendous trade value with Mexico and the tremendous asset of a bilingual workforce. … Latinos are the future workforce of the state and a huge opportunity for businesses to engage with them."
Birthplace: Los Angeles (but considers herself an Arizona native)
Education: Arizona State University
Company description: Phoenix-based advertising and public relations agency with a focus on multicultural markets of the U.S. Southwest, namely Hispanic, and now emerging cross-cultural markets. In November 2015 the company merged with Molera Alvarez Government Affairs to form CoNecs North America. Both entities will exist for approximately one more year before the merger is completed under the new brand.
Financials: $1.5 million pre-merger, expected to as much as double
[Editor's note: The next two entrepreneurs profiled do no meet the criteria of $1 million in revenue or $1 million in funding, but according to broader metrics evaluated by Stanford and LBAN, these businesses are likely to be among the next Latino-founded start-ups to hit those marks.]
Gibbens says that no one has a linear path to success, but her flight path does seem straight up: She attended the Air Force Academy, learned to fly and jump out of planes, managed Air Force cruise missiles and even worked on a team dedicated to the U.S. President's Air Force One.
It was the work on the cruise missiles, a type of drone, and then for government contractor Booz Allen supporting Global Hawk — another autonomous system —that ultimately led to Ph.D. research focused on unmanned aircraft systems.
"All that led me to drones." (Gibbens could not pursue the leadership position she wanted in the Air Force due to skydiving injuries.)
It was support for another student's project on a drone that detects gases that led Gibbens to conceive a drone company for the oil-and-gas sector. Being a Texan who had focused on environmental issues while at the Air Force Academy, Gibbens said, "I wanted to tie this all together."
Trumbull's drones collect data and were the first approved by big oil and gas companies, including Chevron, BP and Phillips 66. It's not all pipelines and oilfields: marine research on humpback whales is part of Trumbull's data collection. A current challenge is that the oil-price collapse has made clients scale back and prioritize long-term projects.
Birthplace: Fort Worth, Texas
Education: Air Force Academy, MBA Oklahoma State, current Ph.D. candidate
Company description: Houston-based Trumbull operates unmanned aircraft systems for the energy sector, for uses including mapping, inspecting and monitoring critical infrastructure and data analytics.
Financials: Declined to disclose
Martinez likes to be referred to as an "impact entrepreneur."
Prior to founding Wala, she focused on microfinance, economic development and women's empowerment. Her graduate school work on public policy was where she first became familiar with the research on how small-scale improvements can make lasting impacts in finance.
Wala, originally known as Swift, started as a cash-transfer platform for women entrepreneurs in Africa. "Most financial systems in emerging markets, especially in Africa, were broken," Martinez said. The broken banking system made the original idea for Swift unworkable and led to Wala, a financial literacy app for underbanked consumers. Wala provides financial education on topics like savings, and plans to ultimately become a provider of banking services. "I have dedicated my life to serving the underserved because I believe that the systems that surround us have failed so many and it's our responsibility to change them," Martinez said.
Wala has already attracted 1 million customers in what Martinez said was a "viral" fashion in five months. Some days the mobile platform adds more than 40,000 people.
Banks in many African markets are unable to deliver the traditionally underserved consumers because of their expensive legacy systems. Instead of trying to fix the problem from within, Martinez is rebuilding it for the consumer. "The vast majority of people will push back because they do not understand, or because it is not the norm. But at the end of the day, it is the entrepreneur's job to push back and deliver," she said. "In the next 10 years, we will be in markets throughout Africa, the Middle East and parts of Asia, providing digital banking to millions of consumers," she predicted.
Birthplace: Fort Worth, Texas
Education: Masters of public policy from the University of Chicago's Irving B. Harris School
Company description: A London-based mobile savings tool focusing on the unbanked in emerging markets.
Financials: Declined to disclose