Welcome to our list of top cities for minority entrepreneurs. In this piece we share our research identifying the cities with the most minority owned businesses.
Small Business Trends conducted a study based on U.S. Census data of minority entrepreneurs. We wanted to identify the cities that have the highest numbers of minority entrepreneurs.
Minority businesses are concentrated in many industries. But we discovered they tended to be in communities with strong tourism, fashion, engineering, construction, technology and food service industries.
The rankings are based on the U.S. Census Survey of Business Owners in 2012. This is data from the latest year that the Census published these types of figures.
What Attracts Minorities to Cities?
Four underlying factors attract entrepreneurs to certain cities:
- Business friendliness – For any entrepreneur, a business friendly location can make a huge difference. It makes it easier to get your business off the ground. You can find more funding. A friendly environment helps you navigate regulations and keeps the cost of doing business low.
- Size and proximity to other opportunities – Some cities are naturally hubs of entrepreneurship due to the proximity of other businesses or organizations. Or the cities are home to a large population of potential customers.
- Quality of life – Some cities offer an outstanding combination of cultural attractions and amenities. Quality of life maters to entrepreneurs.
- Thriving minority community – The existence of an established minority community is a factor in some cities. Entrepreneurs tend to start businesses where they are already located. And if they do relocate, they often are attracted to a community where they feel similarities.
We did not weight these four factors specifically. However, we did see them as drivers of why certain cities are attractive to minority entrepreneurs.
For example, our top four cities are among the top five most populous cities in the United States. Clearly, their large populations are a factor. No surprise there.
However, go beyond the top four, and you start to see more variation. The rankings are affected by more than population alone.
30 Top Cities For Minority Entrepreneurs
Let’s take a look at our rankings for the top 30 cities for minority entrepreneurs.
1. New York City
It shouldn’t be surprising that New York City come in at number one. It has the largest number of minority entrepreneurs, with 539,447. After all, it is the largest city in the United States.
The large base of minority entrepreneurs covers many industries. But concentrations are in booming industries like tourism, fashion, finance and food service.
2. Los Angeles
Next up is Los Angeles. As the second largest city in the U.S. it has the second largest number of minority business owners, with 247,710.
L.A. is known for being the hub of the entertainment industry. So there’s a huge need for businesses in a variety of different creative fields. Hospitality, tourism, transportation and food are also large industries in this city.
Interestingly, Houston is third on the list of most minority entrepreneurs, with 155,654. It punches above its weight in minority entrepreneurship.
Aside from the population, Houston also has Texas’s lack of corporate income and personal income taxes on its side.
Houston offers a number of incentives attractive to entrepreneurs. Programs such as enterprise zones and industrial districts aim to get business owners to start or relocate their businesses to the city.
Key industries in Houston attracting minority business owners are engineering, construction, technology and medical.
With 140,109 minority business owners, the third most populous city in the country comes in number four for minority owned businesses.
Chicago’s large number of professional and educational institutions attract and keep minority entrepreneurs. Tourism, retail food, technology and creative industries are key industries making the Windy City one of our top cities for minority entrepreneurs.
Although Miami is 44th in the U.S. in terms of population, the city comes in at number five. It has 77,125 minority entrepreneurs.
Aside from the warm climate and diversity of the city overall, Miami also offers business incentives such as enterprise and empowerment zones.
Tourism, cruise, retail food, entertainment and construction attract minority businesses to Miami.
6. San Antonio
San Antonio has about 71,287 minority business owners and is number six in our rankings.
Some people may be surprised at this one, because they don’t realize just how large this city is. Yet, San Antonio is one of the top 10 most populated U.S. cities.
One attraction: Texas has no business or personal income taxes.
San Antonio also offers property tax programs that could benefit local businesses. It has foreign trade zones, industrial districts and other incentive programs to bring businesses to the area.
Manufacturing, agriculture, tourism and engineering attract minority business entrepreneurs here.
It is home to the San Antonio Hispanic Chamber of Commerce. This is one of the oldest chamber organizations serving the Hispanic community.
Dallas is another city with Texas’s tax structure on its side. It comes in at number seven in our rankings of best cities for minority entrepreneurs. Dallas has 65,749 minority entrepreneurs.
Aside from the tax structure, Dallas’s infrastructure, cost of living and available workforce contribute to the large number of minority business owners.
Target industries such as building, food manufacturing, sports, media, and IT make Dallas a prime top city for minority entrepreneurs.
Detroit in recent years has seen a renaissance in entrepreneurship. So it wasn’t surprising that it came in at number eight on our list of top cities for minorities to start and run a business. It has 50,946 minority business owners.
Detroit itself is diverse. But other contributing factors include the city’s large number of engineers, construction and manufacturing professionals. There’s also a growing tech sector attracting startups.
Some of the city’s organizations and businesses have even banded together to form the Entrepreneurs of Color Fund. This loan fund supports minority-owned and operated businesses.
9. San Diego
With 50,762 minority entrepreneurs, this popular city ranks ninth on the list.
San Diego draws in entrepreneurs from a variety of industries, including aerospace, maritime, cybersecurity and manufacturing. There are research, advocacy and similar support programs.
Philadelphia has about 48,743 minority business owners.
The city’s neighborhood revitalization efforts, skilled workforce, centralized location and corporate support initiatives lure businesses. Philadelphia also has a minority led entrepreneur accelerator program.
Tourism, sports, retail food and technology are key industries.
11. San Francisco
With 46,128 minority entrepreneurs, the city by the bay has a larger-than-average entrepreneurial community. It comes in at number 11. That’s thanks to a diverse and innovative community.
San Francisco’s research centers, universities and business leaders make it an attractive option. Those in technology and creative industries are especially attracted.
12. San Jose
San Jose ranks 12th in the number of minority owned businesses, with about 45,686. This city in the heart of Silicon Valley works to attract entrepreneurs through workforce development, real estate and cultural programs.
Minority business owners in the area also have access to organizations like Yes We Code. Its mission is to help African Americans and other minorities find entrepreneurial opportunities in Silicon Valley.
Hialeah, Florida boasts a minority entrepreneur population of about 45,245. The city has a large Hispanic population.
Hialeah attracts entrepreneurs with its proximity to major transportation. And it has a vibrant community of independently owned shops and restaurants. All contribute to Hialeah being one of our top cities for minority entrepreneurs.
Memphis ranks 20th in the country in terms of population but 14th in minority entrepreneurs, with 43,949.
The city offers tax incentives, site selection assistance, research services and similar resources to attract businesses to the area. Target industries include bioscience, manufacturing, green business, and music and tourism.
15. El Paso
El Paso has about 43,311 minority business owners.
Once again, Texas proves to be a hotbed of entrepreneurial activity. Of course, there are no income taxes currently.
El Paso, right on the border with Mexico, also offers foreign trade zone incentives. And it is home to the second largest Army base in the US.
In some senses, the Phoenix ranking is a bit surprising. It’s the sixth largest city in terms of general population yet ranks 16th in minority business ownership, at 39,596.
Technology is a hot industry in Phoenix. Manufacturing, bioscience and advanced business services are also growing.
The city also has a diverse talent pool and proximity to several high profile educational institutions. And it has an Entrepreneurial Training Program for African Americans.
17. Fort Worth
Fort Worth attracts entrepreneurs with its low cost of living, business friendly tax structure and talented labor pool. With 33,952 minority business owners, it comes in at number 17 on our list.
It also offers enterprise zones, public improvement districts and neighborhood empowerment zones to increase entrepreneurship.
Charlotte ranks 18th in top cities for minority entrepreneurs. It has 32,449 minority owned businesses.
The city offers programs and incentives like tax credits, financial programs and contracting opportunities. Charlotte also is working on revitalizing several business districts. Charlotte is an attractive entrant in our list of top cities for minority entrepreneurs.
Atlanta has 30,104 minority entrepreneurs. The city works hard to attract business owners and grow its business community. It issues bonds to spur commercial development. Atlanta provides small business loans and promotes other business incentives.
The city also offers plenty of affordable housing options and other quality of life perks. One example: the large number of sporting teams.
20. Washington, D.C.
The nation’s capital has about 29,983 minority business owners. It ranks 20th in the top cities for minority entrepreneurs.
Government contractors and political service providers are hugely popular in Washington, D.C. But the city also offers business improvement districts, community development corporations and similar programs.
Austin ranks 21st on our list, with 28,888 minority entrepreneurs. Once again Texas rules! Texas’s tax benefits are one factor making this city attractive.
Austin also a vibrant music, arts and creative scene. And it’s becoming a thriving tech hub. This makes Austin a big draw for diverse, creative and young entrepreneurs.
When you think minorities and entrepreneurs, you don’t immediately think of Honolulu . Yet it made our list at number 22. It has 28,092 minority entrepreneurs.
Honolulu’s booming tourism, hospitality, agriculture and film industries lead to it being a top pick for entrepreneurs.
Baltimore offer business friendly features like steady tax rates, counseling and talent recruitment.
Baltimore’s local government and business organizations work to create a diverse and tight-knit business community. Baltimore has 27,673 minority owned businesses.
Jacksonville is another Florida city that made our list, at number 24. It has about 27,446 minority entrepreneurs.
Jacksonville, the largest city in Florida, offers huge local festivals and a growing cruise industry. This in part is a draw to businesses.
The city is working to redevelop some of its economically distressed areas. And it is promoting private capital investment for businesses in the area.
25. Long Beach
With 25,159 minority owned businesses, Long Beach ranked number 25 on the top cities for minority entrepreneurs.
A business friendly tax structure, improved city services and a number of other incentives make this a popular community for business owners.
Laredo is another of those cities that benefits from the Texas’s business friendly tax structure.
While it is only about the 81st largest population in the U.S., it ranks number 26 on our list of top places. It boasts a minority entrepreneur population of about 24,727.
Laredo also has a large Hispanic population.
Oakland’s 22,217 minority owned businesses make it one of the top choices for minority entrepreneurs.
The city has a unique, innovative and diverse personality all its own. It is in proximity to several other California cities that are popular with entrepreneurs. Together this makes for a thriving minority entrepreneur population.
Columbus, Ohio ranks 28th in our list of top places for minority entrepreneurs. It has about 21,926.
The city has a thriving tech scene. An active community of economic development and business leaders have specific goals for creating jobs in the community.
The city is working to attract investments for local businesses. Part of its goals are to connect startups with local resources and help existing businesses to expand.
29. Las Vegas
The booming tourism industry in Las Vegas is part of what attracts some business owners. Plus, it’s an exciting place that people love to visit. Las Vegas is home to 20,882 minority business owners.
Tax credits, financing and other state and local incentive programs attract entrepreneurs to Las Vegas.
30. New Orleans
New Orleans, the Big Easy, rounds out our list of top cities for minority entrepreneurs at number 30. It has 20,400 minority owned businesses according to U.S. Census figures.
A vibrant arts and tourism scene are attractions. New Orleans is also aided by a diverse population and talented workforce dedicated to revitalizing the community.
So there you have our list of top cities for minority entrepreneurs, based on US. Census data. See also our 30 Top Cities for Women Entrepreneurs. And be sure to check out our Hub page of Best Places of all sorts.