In celebration of Hispanic Heritage Month, this is the first in a series of blogs examining Latino entrepreneurs and the needs, motivations, and everyday experiences of small Latino businesses. Accion client and Latino entrepreneur Bertha Cerda began her small business, Beta Crafts, in Denver, Colorado.
The number of Latino entrepreneurs in the United States has tripled in size between 1990 and 2012, reaching over 2 million in number, according to the Partnership for a New American Economy. A new study by WalletHubsheds light on where they are thriving and the factors that may support or hinder their success.
WalletHub, a financial resource media site, examined minority business conditions in the 150 largest cities in the United States and created rankings for the best and worst cities for Hispanic entrepreneurs. To determine the final rankings, Wallet Hub looked at two primary factors: purchasing power and business friendliness.
The report identifies eight proxies for purchasing power, including the ratio of the mean annual income of Hispanics to the cost of living index; housing affordability for Hispanics; and Hispanic population growth. Business friendliness was determined based on 11 factors, including the share of businesses owned by Hispanics; the Hispanic entrepreneurship rate; and the number of small business loans per total number of businesses.
Unsurprisingly, Florida, Texas, and California — where over half of the Latino population lives — are cited as top states for Hispanic entrepreneurs. Florida wins top honors, home to the four cities with the highest Hispanic entrepreneurship rate. Pembroke Pines, Florida is cited as the best city overall with a purchasing power ranking of 9 and a business friendliness ranking of 1. Providence, Rhode Island is cited as the worst overall city.
These rankings raise interesting questions: What can be done to make cities with significant purchasing power more business friendly, unlocking economic potential within their communities? Conversely, in cities with business-friendly environments, what can be done to raise wages and provide greater stability for Latino families?
Take San Antonio, Texas; the city has an overall rank of 20, a purchasing power rank of 10, and a business friendliness rank of 87. Accion Texas, headquartered in San Antonio, is helping to nurture a more business friendly environment by helping Latino entrepreneurs start and expand their small businesses.
In Denver, which sports high business friendliness and low purchasing power, Accion Colorado is working to increase Latino wealth by helping entrepreneurs access capital to invest in their businesses and support their families financially. Watch Bertha Cerda, a Denver-based Accion client and Latino entrepreneur, talk about her goals for her small business Beta Crafts.