“Business owners are really driving the economy in terms of employment, 98% of all jobs come from small business” said Monica Villalobos, CEO of Hispanic Chamber of Arizona, as she shares the goal of the company. Due to the large contribution of the small businesses to the economy, the Chamber is driven to ensure business growth and training young entrepreneurs to know basic business principles and ideas that will impact the economy.
Eric Sperling: Hello again everybody, we are hanging out with Monica Villalobos. She is the brand new president and CEO of Hispanic Chamber of Arizona. Monica, thank you so much for being here.
Monica Villalobos: Thank you so much for having me, Eric. Sure.
Eric Sperling: All right, lots of exciting things to talk about today. But first thing I want to talk about is what you were telling me is that we are right now in the valley in Arizona, in a perfect storm as far as this demographic shift. Tell me a little bit more about that.
Monica Villalobos: We are what we know is that in Arizona, Hispanics are 30% of the state’s population 40% of Phoenix metro, and more than 50% of K through 12. On one end of the spectrum, we know that business owners are really driving the economy in terms of employment, 98% of all jobs come from small business.
Eric Sperling: When you told me, that that blew me away. 98% of all jobs in our state come from small business?
Monica Villalobos: Yes, we have over half a million small businesses in Arizona. We’ve got close to half of that, are minority owned, the lion’s share are Hispanic. We also know that minority owned businesses are growing three times faster than non-minority businesses. So between 2007 and 2015, all firms in the state grew about 2%: minority firms grew 60% Hispanic firms grew 70% and Hispanic-women owned firms grew a 116%.
Eric Sperling: That’s fantastic, and that’s the biggest jump and what do you attribute that to?
Monica Villalobos: You know, there are a lot of things I think women are really coming into their own after the recession. They’re really legitimizing a lot of their home-based businesses. But also we’re seeing that spike because until 1987, women required a man’s signature on a business license in this country so…
Eric Sperling: You told me that in the in our pre-interview session and I dropped my notebook, right?
Monica Villalobos: Yeah.
Eric Sperling: That 1987…
Monica Villalobos: 1987.
Eric Sperling: …a man signature was required for a woman to start…
Monica Villalobos: …a woman to start a business.
Eric Sperling: Unbelievable.
Monica Villalobos: And so women are really coming into their own, and that’s why they’re growing by leaps and bounds. But we also know that although these minority firms are growing three times faster, they’re also making significantly less than average annual revenue. So we know that minority owned firms are making about 110,000 in average annual revenue, non-minority owned firms about 500,000. That gap accounts for $36 billion not being realized in Arizona’s economy. On the other end of that, the future workforce is sitting in a K through 12 system that’s ranked 46th in the country in terms of educational achievement. We will lose another generation of students before we fix that problem and those are our future entrepreneurs, our future workforce, that’s our talent pool, ultimately. So, you know, for us, one of our main objectives has been reaching back into K through 12 and being able to expose children to business principles much earlier on in their career, so that they’ve got a leg up, and we’re sort of cutting the learning curve for them. But yes, this perfect storm that will impact our economy is that we are small business driven and, you know, our future entrepreneurs are sitting in that school system, and they’re not going to be prepared for what we need in our workforce.
Eric Sperling: And talking with you, you’re so passionate about entrepreneurship. But you know, just now you’re passionate about starting that at a very young age and you guys have programs that actually help young people develop those skills, right?
Monica Villalobos: We do and it’s really part of our succession planning. A lot of people ask,’ why is the Chamber of Commerce so interested in K through 12?’ And I say ‘that’s our future’. Whatever we do today isn’t really going to matter unless we prepare our young people for that future. So we started a program called the Young Entrepreneurs Academy and this is a national program. It was developed by the Kauffman Institute, they’re the largest entrepreneurship foundation in the country and there are about 90 of these programs across the country. We operate the only one in Arizona, we take children in high school, through a 20 to 30 week program, from business ideation, all the way to registering that business with the Secretary of State. So last year, we graduated 18 new students, CEOs, and registered 12 new businesses with the Secretary of State. And what we’re finding is we know that entrepreneurs on average, start their first business at about 26. And then they’ll have three to four businesses in their lifetime. We’re cutting that learning curve by 10 years.
Eric Sperling: Even that feels young to me, like initially, like 26 feels young.
Monica Villalobos: Mmm-hmmm.
Eric Sperling: Yeah, but you’re saying ‘no, it needs to start much earlier’.
Monica Villalobos: Well, you know, business owners are a rare breed, right? You have to be just a little bit crazy and believe in the impossible and I think at 26, you still have a little bit of that sort of innocence that you don’t know what you don’t know. So that’s, I think, why we see entrepreneur starting so early.
Eric Sperling: And one of the other things about the program, you know, reaching into these high schools, as you were telling me that these businesses that are being created, they all have a cause too, correct?
Monica Villalobos: That’s right. It’s not a requirement of the program but we find that our values as a nonprofit, and giving back to the community are making their way into this curriculum designed for business. And these students, every single business that we’ve had, is that a cause-related component. They want to give back to their community, whatever the business is; they’re, they’re making sure that they’re allocating funding to go back into their community.
Eric Sperling: I don’t mean to put you on the spot. If you have an example you do, if you do. Do you know, one or two?
Monica Villalobos: Sure, absolutely. So we had a young woman who started a business. Her aunt needed a kidney transplant and she created fashionable kidney bags that you have to, you know, the ones that have to carry around. They’re not very attractive, they’re, you know, sort of yucky. And so she created these kind of pouches for these bags, and there was a portion of the revenues that went back to transplants to kidney transplants. And she really just wanted to give back, she saw a very practical solution to medical issue, she fixed that and in the process, she also gave back.
Eric Sperling: Yeah, that makes us all feel great.
Monica Villalobos: Right? It does.
Eric Sperling: That we’re inspiring these young entrepreneurs, and then they’re not just creating a lemonade stand and taking the profit, they are giving back to the community.
Monica Villalobos: They are. We had another wonderful woman who was a refugee, and she started a T-shirt in-printing company and she wanted to give back and so she gave back to IRC here locally. And, you know, just all of her proceeds go back to that. So it’s exciting.
Eric Sperling: We had Robin Reed in here a couple of weeks ago, he is the presidency of the black Chamber of Arizona.
Monica Villalobos: Yes.
Eric Sperling: Some of the hurdles he said he faces or some of the same ones you face as far as getting people and getting organizations and getting entities, whether it’s education, whether it’s government, whether it’s business, to speak the same languages. And can you tell me a little about those hurdles, those specific challenges?
Monica Villalobos: Sure. I’m a big fan of Robin’s, obviously, and we’ve convened what we’re calling the Chamber Collaborative, to speak the same language, to realize our power and in a collective impact. So Robin Reed from the Black Chamber of Arizona, Shon Quannie, from the Native American Chamber, John Lee, from the Chinese chamber, and Vic Freed from the Asian chamber have all gotten together in this chamber collaborative because we realize that a lot of our issues are very, very similar. And we are the new emerging multicultural majority.
Eric Sperling: Yeah.
Monica Villalobos: And we need to do things better than the last majority, right. We need to be able to provide opportunities and also have diversity and inclusion at a very organic level within our organizations. We find the same thing going on in Arizona, between government, business community and educators. We all have to speak the same language in order to solve this problem that we have and break up this perfect storm that’s coming. Right now, we’re asking educators to solve problems that have nothing to do with education, right? We have children that are going to school that have, don’t know if their parents are going to be home when they get there, and they have a deportation plan scheduled…
Eric Sperling: You were telling me you know, you grew up in Southern California, and, and I grew up in Northern California. And so yeah, we had earthquake plans, you know, and…
Monica Villalobos: Where do you go, who do you go talk to, who do you call, you know: have a plan to get the family back together and so here, our students have deportation plans. If you get home and your parents aren’t there, this is who you call, this is where you go. That’s a lot to worry about. We also have kids that are going to school that don’t have access to healthy fruits and vegetables, haven’t had a meal, have skipped a few meals. And we’re asking them, we’re asking educators to teach the math and science when these kids don’t know if their parents are going to be home, they don’t they don’t have food in their belly, their issues and their triaging issues that are much bigger than just education or teaching them math and science. So that’s one problem, right? And then you’ve got business owners and the business community who think you just have a business issue, you have a funding allocation problem, you know, we’ll go in there fix it and I was among them, I was definitely guilty of that. That mindset and thinking, I can go in there, this is a business problem and I just need to rearrange the PNL and fix it but unlike businesses where you can control your input and then create an output, you can’t do that in public. So you can’t pick and choose what kids are going to come in, what the circumstances are going to be for those kids when they come into school, you have to deal with all of them at different levels, meet them where they all are, and they’re all in different places. So, from a business perspective, I think we need to be a little bit more sensitive to that issue. And then from a government perspective, really understanding, you know, what’s the research? What are the needs of the business community for the future? And how do we teach that at the K through 12 level and help educators. So it is a perfect storm, there are a lot of moving parts, it’s very complicated, but I’m holding out hope that we can all get aligned and on the same page.
Eric Sperling: And I appreciate your honesty and being a little vulnerable there saying, you know, ‘I thought I could do it’, ‘I thought I could just walk right in with the business minds and I can fix this’ and realize that that’s not the issue. And that’s what a lot of other organizations entities need to realize too, right?
Monica Villalobos: Right.
Eric Sperling: There’s some things you haven’t seen, or there’s some things that you’re unaware of.
Monica Villalobos: Right.
Eric Sperling: And tell me a little bit more about, you know, what the mission is of, you know, you’re convening everybody together, you’re rallying groups together. I mean, we talked about this, it’s not a day by day plan, it’s not a 3-5 year plan, like, what are we going to, what’s the goal here?
Monica Villalobos: Right, right, you know, it’s really that alignment, getting everybody mission aligned. For us, it’s scaling businesses. If we can provide the resources, the tools, if we can partner with others, to provide those resources, tools and education that minority business owners need to be sustainable, then that solves part of the problem, right? And then simultaneously, we reach back to K through 12, provide the resources, the training, the education that they need, as well, you know, then I’m hopeful that there’s something there, but that there are a lot of challenges along the way, right?
Monica Villalobos: There are a lot of chefs in the kitchen. And you know…
Eric Sperling: …egos in the kitchen, chefs with egos.
Monica Villalobos: Could be, could be. And so it’s really important to understand that we all want the same thing.
Monica Villalobos: We just have different ways of getting there. And if we can combine our resources to create more collective impact, that’s what will make the difference.
Eric Sperling: And this is, you know, this is a big challenge for you, too. And one of the things you told me was you like to be close to the fire and you have peers or colleagues or friends maybe ask you, you know, ‘you sure you want to do this?’
Monica Villalobos: Yes.
Eric Sperling: But you want to, you want to be close to the fire.
Monica Villalobos: I do. I do. Being close to the fire is really why I took this position and being closer to the fire.
Eric Sperling: Right.
Monica Villalobos: I’ve been with the organization for seven years, I’ve really seen it grown, I see the potential, the difference that we can make, and I want to be a part of that. But I do, I have, I grew up in in California and I lived in New York and I have friends that call me and they’re like ‘what are you doing Arizona?’ We get a bad rap sometimes and I say, ‘why aren’t you in Arizona?’, this is ground zero, especially for the Latino community, being able to make a difference here will have ripples across the country. And that’s why it’s so mission critical that we solve for some of those problems and those issues, because I think we will be an example and a bellwether for the rest of the country.
Eric Sperling: And what you told me was, you know, your experience Los Angeles your experience in New York, sometimes it gave you a little bit of a crystal ball for Arizona, right, because people have done it; whether they failed, whether they succeeded, it’s been done before. And now you can apply that to our state, right?
Monica Villalobos: Right. I mean, I think what we’re seeing is not new to the country, we’ve seen it in different parts of the country. And the question is, are we going to learn from those other states that maybe did it differently? Or are we going to make the same mistakes and you know, coming again, from larger markets, like Los Angeles and New York City, I do feel sometimes like I have a little crystal ball or at least that I’ve seen this before, some version of this before, and how it pans out. And I think that helps us to kind of preempt, maybe what comes next.
Eric Sperling: And there’s some, you know, great advantages to having a state like Arizona, you know, for talking about conservation or environments or trade and you talked about the advantages of having a community like Flagstaff or Northern Arizona versus, you know, the southern part of our state for different. Tell me a little bit more about that using the state and its geography as an advantage to understanding and addressing some of these issues.
Monica Villalobos: Sure, I think all statewide organizations tend to be a little Phoenix metro, only because this is where most of the population is, it’s the most populous area of the state. But we have such wonderful resources in northern Arizona and southern Arizona and for statewide organization like ours, expansion is really critical to that, making sure that we’re serving the entire state. So one of the first things on sort of my agenda is making sure that when we talk about things like conservation, climate change, we’re connecting with folks in northern Arizona, that are a little closer to that, that have more initiatives, because of their geographic area and topography and all of that good stuff. And then when we’re talking about export and trade, making sure that we’re connecting with other organizations in southern Arizona, that are closer to the border, that are dealing with that day in and day out, and making sure that we’re learning from them on the best way to leverage that as a strength in Arizona, and mostly being able to show that Hispanics are really contributing to the state’s economy, they’re not taking away from it. And I think that’s sort of what the media sensationalizes sometimes, but they’re actually putting far more into the state and by optimizing our regional resources, being able to connect the dots for everybody.
Eric Sperling: Oh, Monica, thank you so much. Thanks for everything you’re doing.
Monica Villalobos: Thank you, really appreciate it.
Eric Sperling: Thank you chatting with me today.
Monica Villalobos: My pleasure.
Eric Sperling: All right. We’ll, look forward to having you back too.
Monica Villalobos: Sounds good, thank you.
Eric Sperling: All right. We’ll see you next time
Building and running a business comes with its own distinct stress and hassle, but still you’ve got to keep pushing. Step out of the box and integrate your very community into the objectives that drives you. Understand that your community holds the basic leverage for your growth. Begin there and contribute to it, the resultant effect is always worth it.