ohn Garcia has interviewed Charles Manson, delivered babies, pulled knives out of bodies in Chicago and earned millions starting and selling companies.
Now the psychotherapist turned venture capitalist hopes to make Orange County a hotspot for Hispanic businesses.
“It takes a family to build a child,” said Garcia, managing principal of Tustin-based Angel Strategies. “In Orange County, you need a community to build businesses.”
Garcia has his work cut out.
OC is home to about 1 million Hispanics who make up a third of the county’s population. But sizable Hispanic businesses here are hard to come by.
The largest is Anaheim-based Northgate Gonzalez Supermarkets, a Hispanic supermarket operator with estimated yearly sales of $325 million. After that, they dramatically fall off in size.
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Otra Beer: started by Hispanic, geared toward Hispanics |
Garcia said his aim is to lure businesses run by or geared toward Hispanics to OC. He himself moved his offices from Silicon Valley to OC a few years ago, persuaded in part by his hotelier wife who liked the climate.
The goal, in venture capital speak, is to create a “Latino cluster,” Garcia said.
He points to two transplants:
& #149; North American Latino Beer Industries Inc., brewer of Otro Beer, which recently moved from Los Angeles County to Irvine.
& #149; Ventana Health Inc., a maker of nutrition bars aimed at Hispanics, which moved from Santa Barbara to San Clemente.
Ventana President Tim Avila said the move made sense because he and two board members already had homes in OC.
Another company, New York-based Organetix Inc., is considering moving here, Garcia said. The company is seeking to treat liver disorders such as hepatitis C, which is more common among Hispanics.
The Challenge
Garcia’s challenge is in overcoming perceptions. Those not intimately familiar with OC’s transformation in the past decade or so may still cling to outdated notions of a white suburb.
His retort: demographics.
“There is a 50-50 chance that a person is Hispanic in Southern California,” Garcia said.
Garcia’s thinking is that OC, with its growing Hispanic population and entrepreneurial culture, is a logical place to serve the regional market.
Ventana’s Avila said Garcia points to the Latino cluster that’s already here.
“That was the big impetus for us to work with him,” Avila said of Garcia.
Pepe & Elmer Media Inc., a media, marketing and entertainment company in the mid-Wilshire district of Los Angeles, helps Garcia vet prospective companies with an eye on marketing to Hispanics.
The company steered Garcia to Ventana, instead of a rival New York energy bar company, Everlast Nutrition, according to Juan-Carlos Duran, Pepe & Elmer’s president.
“I give him my reconnaissance,” he said. “He’s not looking at just Hispanic-owned businesses, but those that operate in the Hispanic market.”
Garcia’s own track record includes starting and selling medical companies to big names in healthcare. He helped found Sierra Medical Supply, which delivered next-day surgical supplies from Seattle to San Diego, while attending law school in Sacramento.
In 1985, American Hospital Supply, now part of Baxter International Inc., bought Sierra for $50 million.
“That was my turning point,” Garcia said.
After the sale, Garcia said he and his three partners threw a party on the hillside patio of Sterling Vineyards in Napa Valley. They flew in on helicopters and gave away a Corvette, he said.
Days at Alcon
In the next two decades, Garcia said he built up wealth by founding and selling other medical and software companies. One of them, medical software maker Ivy Technologies, was bought by what’s now Nestle SA’s Alcon Inc.
Garcia said he stayed on at Alcon as a mergers and acquisition executive under Nestle for seven years to get a promised nest egg.
After leaving Alcon in the early 1990s, Garcia took his Nestle payout and helped start HealthLink, a $150 million venture fund investing in medical technology companies.
Hambrecht & Quist bought HealthLink in 1997, affording Garcia to retire for a year and move to Southern California with his second wife, living for a year at the Four Seasons Hotel Newport Beach, where she helped manage operations.
Garcia’s life in OC is a long way from his upbringing in a rough East Bakersfield neighborhood. His dad, who had a second grade education, mowed lawns by day and was an orderly who cleaned at a local hospital at night. Eventually, Garcia’s dad saved enough to buy land in downtown Bakersfield.
At 18, Garcia worked alongside his father at the hospital. He got a nursing degree on the side, and worked at Cook County Hospital in Chicago during summers between classes at University of California, Santa Barbara.
“It was a war zone,” Garcia said of the trauma center hospital.
Garcia’s first career was psychotherapy, which he said he took up partly because of his first wife’s battle with depression.
At 26, he started work at Central California’s Atascadero State Hospital, where rapists, murderers and the criminally insane are housed.
Manson Interview
Garcia interviewed cult leader Manson during his days as a psychotherapist.
“It’s not the eyes, but his presence that is extremely negative,” Garcia said. “You suddenly believe in God when you are around him.”
Garcia eventually left psychotherapy, but not entirely.
One of his investments is in the Venture Alliance in Irvine, which screens companies seeking venture capital on behalf of early stage investors.
Funding hopefuls answer some 1,000 questions about their companies. The questionnaire is akin to a “personality test” Garcia once gave to patients as a psychotherapist.
“It’s the FICO score of the venture world,” Garcia said, referring to Fair Isaac Corp.’s credit score for consumers. “It rates companies looking for money with scores.”
Of the 2,500 companies Garcia said he’s run through the questionnaire, 16 have received $89 million in venture funding.
“TVA flies in the face of what a lot of people are taught in business plan writing,” he said.
