Nathalie Molina Niño has worn many hats in her career from founder to investor, and more. As we celebrate Latinx Heritage we had the opportunity to speak with Nathalie and explore the passion she brings to each of those roles and how her professional and personal journey has led to her newest venture, Known Holdings.
Q: You are a founder, an investor, an author, and a relentless advocate for racial and gender equity. What is the through line for all these roles?
Nathalie: I think the one constant is justice. Even as a child I had this hyper awareness of things that didn’t seem fair. And, when I think about it, the through line of my life and my career is that I have found different tools to address the root causes of many injustices.
During the early development of the Internet, English was the dominant language. As an engineer, I believed that making software and information accessible to everyone was critical. Today English is no longer the dominant language online. We’ve moved far beyond that. Being part of that transition was big – and it felt important.
Teaching is also another tool to achieve justice. In my case that was teaching underrepresented founders how to build businesses. But I became frustrated because regardless of how much you educate founders – and especially founders of color -- at the end of the day what really controls their destiny is access to capital. With that realization, I landed in finance and investment.
Given my background as an engineer, my investment thesis is based on achieving measurable impact. We know that women are starting businesses at twice the rate of men in the United States, and 8.9 out of 10 of those businesses are started by women of color. If you care about the ultimate engine of the economy in this country, then you’re going to care about the people who are most active in the entrepreneurial space and those people happen to be women of color.
Yes, I’m Latina. But that’s not the only reason I am an advocate for BIPOC entrepreneurs. I’m interested in real outcomes that are measurable – outcomes over optics. When you do the math, the numbers speak for themselves.
Q: Let’s start with your work as a longstanding advocate for women’s reproductive rights. With the overturning of Roe v. Wade, how are you focusing your advocacy efforts? What should the rest of us be doing to protect against the further erosion of these fundamental rights?
Nathalie: You can’t take electoral politics out of the equation. In terms of how I approach politics, I decided to channel my energy into working with the National Institute for Reproductive Health. They were out front in saying that Roe is going to fall and that the last line of defense when Roe is overturned is going to be state level politics – governors, state senators, and municipal governments. That position was prescient, especially at a time when people didn’t want to give up on Roe. The fact is that Roe has been gone for years and has been under constant attack since Casey and even before.
In addition to focusing on the politics of reproductive rights, from a business perspective, we have to make reproductive healthcare – whether it’s contraception, medical abortion or all the other elements of reproductive health -- accessible. That’s where the business world needs to step up. And there are many ways to help. One example is the Don’t Ban Equality pledge from businesses, like mine, pledging to provide their employees access to reproductive health services, including paying for transportation for people to go out of state to obtain needed care.
Another way the business world is stepping up is making contraception more accessible. Despite all the contraception options available, for the last 50+ years, the birth control pill continues to be the single most popular form of contraception. While giving people access to all the different forms of contraception is very important, I focus on what is going to make the maximum impact, and that is taking the pill over the counter.
We’re in the thick of that effort right now with a company in which I’ve invested and on whose Board of Directors I serve – Cadence Health. We’re seeking FDA approval to sell the birth control pill over the counter, but the approval process is taking far longer than it should. We should have the pill accessible in every corner store and every neighborhood and on Amazon and Walmart. This is not a philanthropic effort. And it’s not a government initiative. It is being driven by a group of well-intentioned businesspeople and investors who are making change through the private sector. It’s an example of how the business sector can make a big difference.
Q: Turning to your work as an investor, your thesis is unique: more Berkshire Hathaway than Andreessen Horowitz. You aim to be the fuel that enables BIPOC founders to build successful, sustainable businesses, creating generational wealth for communities of color. How do you do that and why do you think so few investors share your vision?
Nathalie: First of all, I don’t consider myself a fund manager. I’m a big believer in long-term, patient capital. We call it builder capitalism. Investing with a long-term lens requires a structure that is different from the typical venture fund, which by design focuses on realizing returns within a short-term horizon. I prefer to use “Holdco” structures, where we can invest in every company on its own timeline. Cadence Health – the OTC birth control company in which I’ve invested - is on a very different timeline than a company building a software product.
Most venture funds try to fit every investment into the same box, without regard to each company’s optimal growth timeline. And that can do a disservice to a company and its founders. To me, it’s the equivalent of investors who flip houses. They might not care about the fact that a roof needs to be changed in 10 years because they’re going to flip the house in two. The same is true with short-term investment theses and long-term investment theses. You think differently. You make different decisions when you’re looking to build something for the long haul rather than when you’re looking to flip it as quickly as possible to the first buyer.
There are other compelling reasons to take a long view. We’re not just talking about P&L’s and earnings statements. We’re talking about the human beings who power these companies: their jobs, their livelihoods, their families, and the entire communities that depend on these companies. But even if you are just focused on the bottom line, the profits of long-term investors far exceed those of shorter-term investors, like venture capitalists. I would put the most successful VCs up against Warren Buffett any day. So even if you don’t care about impact or what’s good for humanity and you just want to look at the numbers, the long-term investor always wins.
It’s unfortunate that short-term investing, which represents .05% of all business financing, takes up 99% of the oxygen. That perpetuates a belief that financing of businesses must be in the form of short-term mechanisms. I would love to see a world where there is more visibility into how most businesses get financed, and that’s a big part of what motivates me.
Q: You recently launched Known Holdings, with three partners -- a legendary Black investor, the first Native American to own a Wall Street investment firm, and a South Asian powerhouse who formerly ran tech for Rockefeller – and with an ambitious mission to put the control of capital into the hands of people of color. How to you plan to execute on that mission?
Nathalie: The inspiration for Known Holdings was a very specific response to what we’re seeing in the U.S. Many titans of industry and finance have managed to scale in a short amount of time. The reason for that is most of them spun off a mothership of some kind. Think about BlackRock. BlackRock manages trillions of dollars, and it is not a 35-year-old company. Larry Fink was informally mentored by Stephen Schwarzman, who gave him capital, connections, support, and infrastructure that enabled him to start BlackRock. So, one of the key elements in the recipe for success is the backing of a mothership that provides resources, connections, and capital.
We noticed two things with respect to financial services companies owned or managed by Black and Indigenous people and other people of color. They are not growing at the same scale and pace as white-owned businesses, and none of them have spun off of a mothership. They are all by themselves, on an island, isolated. We concluded that BIPOC-owned firms are not scaling because they lack a mothership. And that’s the gap in the marketplace we’re filling. We’re starting with wealth management and investment banking, and we will be channeling capital towards fund managers across multiple asset classes -- real estate, debt, and private equity -- with the goal of directly having a hand in scaling the next generation of titans of industry.
We’ve already experimented with a couple of case studies where we have influenced the growth of BIPOC-owned companies. For example, in January 2021, we started working with one New York-based company that had experienced a plateau in their growth. By the end of the year, they had grown their assets under management by 5x.
Q: Finally, as a former founder, what advice do you have for Latina founders and other founders of color as they work to build successful companies?
Nathalie: I think that founders are sold a single model. We’re told you have to quit your job or you won’t be taken seriously. Yet we know that some of the biggest businesses started as side hustles. And it’s often the entrepreneurs without big safety nets or nest eggs who start those side hustles. Companies are as diverse as human beings, and anybody who tells you that there is one way to finance a company, or one way to grow a company, or one way to scale a company is mistaken.
Women of color are the most entrepreneurial demographic in this country. If we can overcome the misconception that there is only one path to being a successful entrepreneur, then a world of possibilities opens up. You start looking at different forms of capital. You start thinking of different ways to grow your business. You start seeking counsel in unorthodox places. The paths to success are as diverse as the entrepreneurs themselves. Recognizing that unlocks untapped resources and new opportunities.