Minority Entrepreneurs Seek Capital
Minority owned businesses are critical to the national and local economies. The growth potential of minority-owned businesses is being severely hampered. These businesses face the obstacles of access to capital, access to markets and access to social networks, all of which are essential for any business to increase in size and scale. Inadequate access to financial capital continues to be a constraint limiting the growth of minority-owned businesses. Approximately 18.7% (1.1 million) of U.S. employer businesses were minority-owned. About 20.9% (1.2 million) of businesses were owned by women.
With consumption totaling $1.85 trillion, Latinos, who make up 19% of the total U.S. population, represent a formidable customer base. More than just consumers, 350,000 Latino-owned employer businesses produced more than $460 billion in annual revenue and employed 2.9 million people.
Hispanic-owned start ups have outpaced other ethnic groups, with 44% growth in the last 10 years compared to 4% for non-Hispanics. Despite being the fastest-growing demographic, difficulty accessing capital has limited the growth potential for hispanic-owned businesses.
There were an estimated 134,500 Black or African American-owned businesses with $133.7 billion in annual receipts. 1.3 million employees and about $40.5 billion in annual payroll, according to the United States Census Bureau.
Approximately 581,200 Asian-owned businesses had the largest estimated receipts ($874.6 billion) among minority race groups across all sectors.
Have a candid conversation with any business owner and they’ll most likely identify the lack of capital as one of their biggest hurdles. In pursuit of capital, minority business owners tend to max their credit cards, over extend the limits of their personal wealth, and seek funds from family and friends before turning to a bank or other commercial financing source. In fact, more than 70 percent of Hispanic entrepreneurs had this tendency and the rates are similar among Asian and Black-owned companies. These habits can be detrimental for entrepreneurs when they need to acquire small-business financing.
Maintaining cash flow and covering operating costs are aggravated by a lack of access to capital for many minority small business owners.
When using over 30 percent of their available personal credit, minority owners appear on paper to be overusing their credit resources. This can lower their credit score which can adversely affect the rate they pay for equipment financing.
As U.S. consumers continue to support minority owned businesses, Commercial Capital Company improves access to capital for minority entrepreneurs by strengthening relationships with minority business owners across the Midwest. Having a strong working relationship with financial partners is a key factor in the success of minority run businesses. We’re aware of the challenges minority owners face and understand each businesses has different needs based on where they are in the life cycle of their business. Flexible lease options are specially designed for early-stage companies and startups plus other options for more established companies, as well.
When minority owners have access to capital, their businesses survive, thrive, and contribute to economic growth and their local communities.
We may help with your challenges and objectives for 2022 and beyond to lead your operations into the this next decade. Looking forward, we strive to provide clear and actionable opportunities for both small business and enterprise firms. With over 25 years of experience in various industries, Commercial Capital Company provides equipment financing solutions for decision makers which enable them to build successful businesses and thriving communities.
Your Steadfast Financing Partner Since 1988
If you’re contemplating purchasing new equipment, please feel free to call us or stop by the office for a consultation. We have flexible lease options with competitive rates. We’ve helped thousands of companies grow their businesses for over two decades. Discover how we may help your business grow and succeed.
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