New funds aim to fill the capital gap.
Latino entrepreneurs seeking investments from $50,000 to $15 million now have two new equity funds to approach. Created by the U.S. Hispanic Chamber of Commerce (USHCC) with help from lead investor Bank One Corp., the funds target one of the nation's fastest-growing business segments. The USHCC Small Business Equity Fund-which, when fully capitalized and leveraged, is expected to reach $30 million-will invest $50,000 to $500,000 in individual firms, including early-stage and established companies. In addition, unlike typical industry-specific funds, this one has a lower hurdle rate for return on investment.
The USHCC Private Equity Fund LP targets small and midsized Latino-owned companies with annual sales in excess of $1 million. It will invest from $5 million to $15 million, with an exit strategy of three to five years. When fully capitalized and leveraged, the fund is expected to hit the $150 million mark.
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