Suma Wealth Raises $2 Million to Help Latinos Manage Money

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 .

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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 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.