Funding Remains Scarce For Latino Tech Startups
Latino business owners have made strides, but access to capital still remains scarce.
Technological innovation in the 21st century has brought a lot of advances and fortunes. But unfortunately, Latinos are often left behind.
According to the Brookings Institution:“Broadly speaking, blacks and Hispanics have made genuine progress in penetrating the nation’s tech sector. Black people, for example, have increased their presence in several important tech occupations, such as computer programming and operations research. Likewise, Latinos have increased their representation in the overall computer and math occupational group, moving from 5.5 percent of workers in the sector in 2002 to 6.8 percent of workers in 2016.”
This progress has helped encourage Latino entrepreneurship.
However, as we look deeper at technological innovation and the participation of Latinos, we see only a small percentage of Latinos are securing private funding for technological research and innovation.
Aside from educational factors, there is also a lack of participation in organized technological innovation.
While there are countless tales of how major technological innovations came out of someone’s garage (like Apple’s first computers in the 1970s and Amazon’s first web page in the 1990s), the reality is that the majority of innovative ideas and gadgets flourish with funding.
These organized groups have either come out of university labs of research or from a company’s research work that is primarily funded with government and private funding.
With the exception of Texas, metros in large states with a high percentage of Latinos such as California and Florida are not showing an increase of Latinos in those sectors.
As Latino-owned businesses continue to re-invent themselves, one good source of funding for innovation research and new product development is America’s Seed Fund program, the Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR).
The America’s Seed Fund programs have been in existence for over 40 years with the aim of funding small businesses in research and development and bringing them into the market.
For example, one award is a grant up to $256,000 in seed capital to cover expenses for research and development over six to 12 months. Other benefits from those programs is the chance to get feedback and work with an expert or mentor.
Additional details of National Sciences Foundation’s America’s Seed Fund programs can be found here.
Dr. Claudia Araiza has held positions in various capacities in business, academic, and governmental settings ranging from business and economic analysis, business development, academic administration, research, teaching, and online course development.