Small businesses play an important role in our nation’s economy and minority-owned small businesses are a large part of that. The Hill noted in 2019: "Minorities own an estimated 29 percent of classifiable businesses, which are growing at twice the rate of non-minority businesses. They employ more than 6.3 million Americans and generate over $1 trillion in revenue."Despite those impressive numbers, minority businesses face significant challenges, such as finding small business funding. The location could potentially be a factor determining which minority-owned businesses succeed or fail. Which US cities are the best for starting a small business?
Entrepreneurship Tips—Best Locations for Minority Business Growth
Small Business Trends recently looked at some of the best US cities where minority-owned businesses seem to perform well. The survey was based on the number of minority-owned businesses, but also took into account:
- Cost of living
- Industry clusters
- Other startups in the area
- Overall population
Their top 10 list of best cities for minority-owned small businesses include:
- Miami, Florida holds almost 63,000 small business entrepreneurs, according to the report. The majority work in retail trade.
- Los Angeles, California is the second-largest city in the US. It also hosts the second-highest percentage of minority business owners, at roughly 114,500. In this city, minority business owners focus on healthcare and social services.
- San Jose, California was third on the list, with 16,705 minority business owners. Given the influence of Silicon Valley, the primary minority small businesses focus on professional service, science, and the technology fields.
- San Francisco, California has over 34,400 minority-owned small businesses. Technology is hot in the region, and San Francisco hosts some big names like Google, Facebook, Dropbox, Craigslist, and Fitbit. Most of the minority small businesses in the region focus on hospitality and the restaurant industry.
- New York, New York is home to more than 131,300 minority-owned companies. Many of these companies work in the retail trade sector.
- Washington, D.C. has more than 35,000 minority-owned businesses that call the nation’s capital their home. Most of these companies are white-collar, serving in technical, scientific, or other professional fields.
- San Diego, California made the list as well, with more than 16,200 minority-owned small companies. These businesses largely fall within the social service and healthcare categories.
- Houston, Texas holds over 32,600 minority companies who serve primarily in retail services. It should be noted that Houston was recently named the most diverse city in the nation. Could this melding of cultures create a better environment for minority-owned businesses?
- Atlanta, Georgia brings some minority-owned businesses to the middle of the country, with more than 26,600 of these companies calling it their home. Most work in the retail trade. It should be noted that the city’s population is 54 percent African American.
- Orlando, Florida has 11,200-plus minority-owned businesses. Home to Walt Disney World, Universal Studios and Sea World, the city has an entertainment focus, along with a focus on space and technology in nearby Cape Canaveral. Like most of Florida, it is also a retirement hub; most of the small businesses in the area concentrate on social assistance and healthcare.
While California dominated the top 10 spots for minority-owned companies, there are clearly opportunities around the country to consider. For more entrepreneurship tips, check out our Resource Center.