On this episode of the LA Venture podcast, Untapped Capital, Alltruits and Kiva founder Jessica Jackley talks about her experience supporting entrepreneurs across the world, and offers advice to founders on what to do when encountering doubt -- from themselves or others.
"The pursuit of an opportunity, a vision, like an imaginary world that you want to make real. You're running after this thing, you're pursuing it without regard to what you have in front of you," she said. "So there's always going to be something wrong."
Jackley's journey as an entrepreneur started when she founded Kiva, a nonprofit that lends money to low-income entrepreneurs. She started the company and moved to East Africa where she heard stories of people starting businesses with just $100.
"I wasn't asked to swoop in and help or save. I was asked strategic questions about where they could access loan capital, where they could access business training," said Jackley. She added that the individuals she met through the service didn't want handouts.
Kiva offered $200, $300 loans at no interest. That model helped build successful small businesses. Every year, they saw a raise on how many loans they could offer. The company has so far facilitated $1.5 billion in loans since the business started in 2005.
More recently, Jackley founded Untapped Capital and Alltruits. Untapped gave her opportunities to invest in unexpected companies and watch them rise, much like Kiva. Alltruits was born out of the pandemic.
"I really wanted to figure out a way, especially as we were on lockdown, like how do we not just have our lives be waiting for the doorbell to ring and another package is dropped off and we just consume it, right? What, what would it look like to reach back out into the world in a way that is helpful," said Jackley.
She created a box subscription service that provides kids with activities that can benefit them and the world. The company's last box focused on making a pollinator hotel for bees.
From her ventures, Jackley recognized when pursuing your dreams, something will always go wrong.
"There's going to be days when you are told, or you're telling yourself, 'well, I'm not old enough', 'I'm too old'. 'I don't have enough experience'. 'I have the wrong experience', whatever," said Jackley. "Just take more steps anyway towards that thing. Cause that's what great entrepreneurs do."
Hear more of the episode, in which Jackley talks about her goal to disrupt the volunteer economy and more.
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PayPal-backed fintech startup Tala has raised $145 million in a Series E round to expand its financial services in countries in emerging markets and to develop a mass-market crypto product.
The raise was led by lending platform Upstart with participation from the Stellar Development Foundation, bringing the total raised by the Santa Monica-based company to more than $350 million.
The Android mobile app allows people who are traditionally underbanked to borrow and save their money.
"We'll use this investment to provide those services and accelerate the rollout of our new financial account experience, which provides fresh new tools to grow, save, and manage your money," the company said in a blog post on its website. "We'll also work to develop one of the first mass-market crypto products for emerging markets to help make crypto solutions more affordable and equitable for those who need them most."
The company said its six million users have borrowed more than $2.7 billion across Kenya, the Philippines, Mexico and India. Loans range from $10 to $500 with rates as low as 4%, the company said. People who don't have a formal credit history can apply.
In January, Tala announced it partnered with Visa to help its customers convert, store and use crypto currencies. It started with USDC, Circle's stablecoin, a cryptocurrency that is pegged to the U.S. dollar. Users will have access to the cryptocurrency in their digital wallet. The agreement with Visa also gave Tala users access to Visa cards linked to the digital wallet, allowing them to spend their USDC anywhere Visa is accepted.
Kindred Ventures and the J. Safra Group also participated in the round, along with returning investors IVP, Revolution Growth, PayPal Ventures and Lowercase Capital.
- Suma Wealth Aims to Provide US Latinos Financial Tools - dot.LA ›
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Even as the Latino middle class grows, the wealth gap persists. A typical white family has five times more wealth than Latinos. Suma was founded nine months ago by CEO Beatriz Acevedo with the goal of bridging the Latinos wealth gap.
A seasoned tech entrepreneur who founded Latino-focused entertainment company Mitú, which was acquired last year by GoDigital Media Group owner of Latido Networks for an undisclosed amount. Mitú had raised $52 million, but struggled especially during the pandemic. She also runs her family's California charity, the Acevedo Foundation.
Acevedo, who was born in Tijuana and has called herself "a proud border girl," wanted to build an app that helped a new generation plan their financial future.
Suma combines several tools in its "dinero toolkit" to help Latinos manage their money including savings goal trackers and tips and calculators to help people rent or buy a home and pay off credit card debt.
Acevedo said Latinos from many countries have struggled to maintain wealth or learn about money because of unpredictable governments – and older generations still recall hardship accessing their money during changing regimes.
"The problem that we have is that there's so much distrust in our community, in financial institutions, and even FinTech companies," Acevedo said. "Our parents and our grandparents come from countries of origin where they had tremendous financial hardship – whether you were in Mexico in a crazy devaluation, or Venezuela or Argentina, where you could never pull out your money from your bank one day and everything you've built is gone."
Suma CEO Beatriz Acevedo
This distrust coupled with a lack of personalized messaging and often shoddy translation means that many Latinos feel isolated and have difficulty navigating their finances using traditional banks and are looking elsewhere, Acevedo said.
Roughly 22,000 people are on the waitlist to use Suma, and it has built an online community of nearly 340,000, Acevedo said. While most Suma users are in California, it also has users in Chicago, New York and Texas. But it is looking to expand and just got a lifeline with a fresh round of funding.
This week, it announced that it raised $2 million to expand its operations and launch mobile apps next month.
The round was led by Chingona Ventures partner Samara Hernandez. Unlike most fintech companies, Suma board and investors are incredibly diverse – Acevedo said its cap table is 77% female and 72% Latino.
Hernandez is on Suma's board and told the Wall Street Journal during its seed raise she was inspired by Acevedo's pitch. "Before she had a name, I was in… I was sold immediately," Hernandez told the Journal.
Suma has raised $3.3 million since its 2020 launch following this round. It will use the new funding to hire more staff and launch its upcoming mobile apps. It generates revenue through subscriptions, but the web platform is now free.
Acevedo said the company is prioritizing digital expansion because its main audience is Millennials and Generation Z – young Latinos ages 28 to 35. As an added bonus, Acevedo said many of those younger users can also encourage their older family members to also get on the app.
Suma's investors also include Los Angeles-based Vamos Ventures' founder Marcos Gonzalez, Ulu Ventures, OVO Fund, Vitalize VC, Supercharged Initiative, The Fund and Gaingels.
Bridging the Gap
The Latino-White wealth gap is staggering, and the pandemic only exacerbated the problem. Acevedo noted the average Latino man makes $.55 for every dollar earned by a white man.
According to the Federal Reserve's most recent survey of consumer finances, the average white family's wealth is roughly five times that of a Hispanic family.
Latinos are gaining ground – the Urban Institute reported this year a young and growing Latino population is expected to make up most new homeowners through 2040 – an estimated 4.8 million more homeowners.
Young Latinos, Acevedo said, "are the ones entering the workforce at the fastest rate and it's a group that has the least wealth."
Acevedo wants to target these potential new homeowners and teach them valuable financial literacy skills to help protect their investments.
One feature launched this week is a financial checkup tool that analyzes a handful of features that impact a person's overall wealth including net worth, debt to income ratio, budgeting and emergency savings to calculate its version of a credit score.
In August, Suma ran Dinero Bootcamp, a youth-focused financial literacy workshop that helped 125 Latinos learn about their money. Wells Fargo granted an undisclosed sum to help Suma target local neighborhoods like Huntington Park, South Central, Downtown and Boyle Heights.
"We're excited to see that (Suma) works, that our community is excited to learn and to do better, and that they trust us, so we need to continue to arm them with all the tools and information and resources," Acevedo said.
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