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Latin philanthropy tackles Covid fallout while aiming to stem the growing wealth gap

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In March 2020, Fred Sotelo was excited about the “astronomical growth” of his San Diego business, Tolteca Corp, which distributes craft beer and coffee to mom and pop stores, as well as restaurants.

A few days after celebrating the company’s second anniversary, the country went into lockdown due to the coronavirus pandemic.

“We lost half of our customers overnight. We were frantic. he said. He had to change some of his more “traditional” ways of doing business, such as people signing a delivery on a piece of paper, and instead had to figure out how to move things online.

Thanks to a program offered by Google through the organization Hispanics in Philanthropy, Sotelo obtained training, as well as a grant which allowed his company to remain operational.

The pandemic has hit Latinos across the country disproportionately, not only in the number of Covid cases and deaths, but also in job losses. Small Latin American businesses have also been hit hard, especially as many have not been able to access paycheck protection program funding at the same pace as other business owners. Unemployment was higher among Latino workers than American workers overall. Pay cuts have often kept Hispanics from losing their jobs, but have kept families from paying bills and shopping for groceries.

As the pandemic began, Hispanics in Philanthropy, a nonprofit group that connects donors with foundations and nonprofit organizations that provide resources to Latin American families and businesses, saw a drop in small donations. Many people no longer had the same amount of disposable income and, at the same time, the tax code changed, making charitable donations less than $ 250,000 ineligible for the same tax shelter as before.

But even though they were struggling with job losses, many Latinos were still doing a lot of “informal philanthropy,” said Nancy Santiago, who was recently vice president of the nonprofit group, and now works with the nonprofit. US surgeon general Vivek Murthy as deputy director of engagement.

Rather than donating to Hispanics in Philanthropy, many helped neighbors, members of their community or donated to their church, she said.

Most of the businesses the group helps are mom and pop stores. In addition to monetary aid to help keep businesses open, the group is working to provide coaching, mentoring and support so businesses can stay open throughout the pandemic.

Gradually, Santiago said, bigger donors like Google and MacKenzie Scott, the billionaire philanthropist, stepped in. Google made a $ 3 million commitment, while Scott contributed $ 15 million.

Small Latin American businesses “are part of the economic backbone of this country,” said Hector Mujica, head of business opportunities at Google.org and member of the board of directors of Hispanics in Philanthropy. “When I think of Latin American SMEs, I think of my family. I think of the role that small businesses have played in my family’s history in the United States.”

Latinos lost 66% of their household wealth during the last recession and now there is concern about the fallout from the Covid pandemic.

“Just like the black community, all of the equity is in our homes,” Santiago said. “So when people lose their homes, we lose our equity in this country. How do you influence politics if you can’t influence the political process? And you can’t influence the political process without resources.

To combat this, Santiago co-founded the nonprofit group’s Power Up Fund, a donor-advised fund that specifically addresses the issue of economic inequality. It recently made its first distribution of money and capital to start-ups. The first big investment came from a partnership with Google, where the money went directly to the Power Up Fund and in turn, they gave grants in addition to coaching and support, to 500 entrepreneurs in California, Texas. and New York.

“When we can’t find a way to solve a problem, we find a solution,” Santiago said. “It’s not in our wheelhouse to do small business, but we knew no one else was doing it in this philanthropic way.”

The HIPGive platform launched new tools including digital giving circles and crowdfunding to increase giving from Latinos across the Americas.

This week, Hispanics in Philanthropy hosted a conference in Los Angeles as well as Virtually, which brought together Latino business leaders and philanthropists in a space to strategize and share results.

“This year’s conference encouraged us to have difficult conversations about the inequalities that still exist in Latinx communities,” said Ana Marie Argilagos, president and CEO of the nonprofit group. “Donors have started conversations about their commitment to closing the inequality gap.”

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