Earlier in the week, I heard a story about angels – angel investors, that is – that got me thinking about that moment at the conclusion of “It’s a Wonderful Life” when a bell on the Bailey’s Christmas tree rings miraculously, seemingly on its own. One of the Bailey kids reacts: “Look, Daddy. Teacher says, every time a bell rings an angel gets his wings.” The angel in this story – Clarence – indeed had just earned his wings for helping George Bailey, father of the family, pull the community together to save the bank (and the community).
It’s not easy being an angel -- it takes study, patience, and a lot of heart -- and that’s the challenge that a new angel investor network is seeking to address. And they’re looking to educate not just any kind of investor, but investors interested in funding Latino startups.
The new entity is the Manos Angel Network, a special project by the folks at Manos Accelerator, one of the first accelerators to dedicate itself exclusively to nurturing Latino startups. After two cohorts where the focus was on the demand side of entrepreneurship (startups who need support), Manos saw the opportunity to focus on the supply side, the growing number of people who might be interested in investing in Latino entrepreneurship but lack the knowledge, tools, and experience.
Last week, at the offices of Silicon Valley law firm Wilson Sonsini, Manos held a “boot camp” for seven prospective angels. On the first day they got expert instruction from the likes of Susan Preston, a lead instructor for Angel Resource Institute (ARI) and expert on angel financing. On days two and three, they applied what they learned as they heard pitches from 11 startups in the Manos community. At the conclusion, the angels selected three startups as finalists, and chose one for special commendation. The new band of Latino angels is now in discussions with the winner (Silicon Valley-based Survmetrics) while the other two finalists (Mexico-based Hostspot, and Arizona-based Hemheist) navigate a range of opportunities surfaced during the boot camp.
By shifting their sights to the supply side, Manos is working to correct a big problem in the Latino tech community. According to their press release: “Less than 1 percent of venture-backed companies are founded by Latinos according to CB Insights, while all minorities represent only 4 percent of U.S. angel investors.” Many groups like Manos have tried to correct the first problem (the dearth of Latino startups) but few, I believe, have looked at the second (the dearth of Latino investors). “We wanted to close the funding gap and angel investors are a critical part of the startup ecosystem,” said Manos partner Hana Yang. Understood. But by shifting their sights to the supply side, they might also encourage other groups to do the same. The attention that Manos has gotten over the past two years has inspired many different parts of the ecosystem to take action.
But, for my money, the real value in this experiment comes at the moments when real support comes through. As I said, there’s a term sheet under construction. And there’s lots of happy talk and positive vibes. "As part of our due diligence, Survmetrics not only had a differentiate technology and a clear value proposition, but just as important, the founders showed passion and flexibility to build a successful company," said investor Alejandro Estrada. In turn, Survmetrics – a graduate of 500 Startups – got “a group of angel investors with years of expertise and knowledge, ready to help make Survmetrics something bigger and stronger in the industry," said co-founder Ramon Escobar.
Is this kind of matchmaking replicable? Will Manos inspire investors to go where other angels fear to tread? Hard to imagine the future for something so new. But next time you hear ca-ching, imagine that another Latino angel has just earned her wings.
