We sat down with Ramona Ortega, Founder & CEO of My Money My Future, a mission-driven financial tech company that combines culturally relevant financial content and simple to use tools to help young multi-cultural consumers manage their money with confidence. Ortega discusses her vision for the next generation of Latinx founders and how equity crowdfunding is offering new opportunities for underrepresented entrepreneurs.
Project Entrepreneur: With the Latino Startup Alliance, you work specifically with Latino innovators. Tell us more about the Latino startup landscape, and the inherent advantages and challenges facing this community.
Ortega: There is so much untapped or undervalued opportunity in the market between the Latinx and African American founders. In particular, you see women from both of these groups founding and launching small businesses at the highest rate in the country so what that indicates is that there is no lack of interest in being an entrepreneur but there is not enough support and resources to get these same women to be scale in the tech startup ecosystem.
For those of us in the ecosystem, and there are few, we don't have access to the same networks and capital as two guys from Stanford. We have ideas, we have abilities and we have resilience but we don't access to some of the key levers that make a company successful in Silicon Valley.
What we do have, are the numbers, for many Latinx tech entrepreneurs, this is a long game, this is about owning a market, particularly for those with consumer-facing products. I think we also going to see more Latinx launching companies in the B2B market. As we get more people coming out of the STEM pipeline, we will see more diversity in Blockchain, AI, and emerging technologies. I am very excited about the next decade and the demographic shift of the nation.
What is your vision for the next generation of Latina entrepreneurs?
Because of groups like LSA and the entrepreneurs that make it up, Latinx have mentors and people that are paving this road. I hope that because of this, a new generation of Latinx tech entrepreneurs can take more risk, that they know more about the ecosystem and we can see companies succeed with less barriers.
Latino Startup Alliance launched Project Equity Impact, an initiative to educate Latino entrepreneurs and investors about the new rules, risks, and opportunities around equity crowdfunding. Tell us about this initiative.
Title III of the Jumpstart Our Business Startups Act (JOBS Act) went into effect last year. Reg CF allows the general public, regardless of net worth, to invest up to $2,000 or 5 percent of their annual income, whichever is greater, directly in private companies through online crowdfunding portals.Prior to Reg CF, investing in startup companies was restricted to an elite group of wealthy "accredited investors" with earnings over $200,000 or a net worth of at least $1 million.
Reg CF represents a huge opportunity for women and minorities founders to access seed capital. Project Equity Impact is working with a wide range of strategic partners to ensure that Latino entrepreneurs and investors clearly understand the new rules and their inherent risks. Given the lack of seed funding going to Latino founders in Silicon Valley, we believe that Latino and minority-led startups are a market this is undervalued and overlooked, so we hope that through Equity CF we can arbitrage this opportunity.
We see this initiative as a platform to address two pressing problems facing diverse entrepreneurs, first, we want to increase the pool of early-stage capital to underrepresented entrepreneurs and second, we want to diversify and increase the number of angel investors in tech. We believe education is critical so people feel comfortable in taking advantage of these new opportunities.We have already seen early success in this initiative with MadeBoss raising nearly $100,000K from first time Latino investors.
You launched your own company - My Money My Future - tell us about your mission and goals.
I launched MMMF because I believe that everyone should have access to quality financial guidance. We are mission-based, started with the goal of empowering communities of color to manage their money with confidence. Our platform provides digital financial guidance to help millennials, in particular, make smarter financial decisions.
By focusing on a multicultural millennial audience we hope to make MMMF a lifestyle brand that blends financial education with financial management. One piece of advice is to start investing early, no matter how little. Even if you don't have a work-based retirement plan (aka 401K), you can still start investing via a Roth IRA. I always say, "it's not how much you invest, it's how long you invest."
What do first-time entrepreneurs need to know about planning for their financial futures?
Before you leave your day job make sure you do a financial 360, know what you have in savings and retirement, and understand your budget realistically from your life as a newly minted entrepreneur. You should have at least 3-6 months of emergency savings in the bank before you leave your job and start planning at least 6 months in advance. It always takes more money and way longer than you think to become cash flow positive.
The other thing is really understanding the numbers behind your business. How are you going to make money, what's the margin, how much will you need to scale and how long is it going to take before you can pay yourself? For all of those interesting in learning more about each of these topics, sign-up for a free account at My Money My Future and get access to action plans and webinars on these topics.