Hispanic-owned businesses—there are about 3.2 million of them in the U.S.—will generate $468 billion in revenue this year, according to a new study from consultancy Geoscape. That’s up from 1.6 million businesses and $254 billion in 2002.
One explanation for the fast growth: Recent research showing that immigrants are 27 percent more likely to start a business—and also more likely to perceive opportunity and less afraid of failure—than native-born Americans.
“For a good period of time, Hispanic businesses concentrated in the trades, especially agriculture and construction,” says Javier Palomarez, chief executive officer of the U.S. Hispanic Chamber of Commerce. “Today, we have businesses of all sizes in every industry and every corner of the country.”
I spoke recently to Palomarez as his organization, which serves as an umbrella for more than 200 local Hispanic chambers, prepared for its annual convention this week in Chicago. Edited excerpts of our conversation follow.
To what do you attribute the increase in Hispanic-owned businesses?
Culturally, it’s within the DNA of the community. It’s a collaborative community. Many people have arrived from other countries, or aren’t far removed. They’ve had to make it on their own, to bootstrap it. And starting a business is an effective way to build wealth.
What’s the U.S. Hispanic Chamber of Commerce doing to promote that community?
We’ve been keen on focusing on commerce, entrepreneurship, and job creation. I took over about three years ago, as the organization’s first corporate-trained chief executive. Previously, we had more of a civil rights kind of bent. Now, our whole idea is to mainstream the story of the Hispanic business enterprise, to tell the story that’s gone untold: I’m talking about the contributions that Hispanic-owned businesses are making to the U.S. economy.
Why the shift?
As the community comes into its own, it has different needs. One of the clear manifestations of where we are was the last presidential election. Never before has our community played such a critical role in electing a president; never again will a president be elected without appealing to our community. Sixty-thousand Hispanics turn 18 every month. I don’t care if you’re running for president or local dogcatcher, you have to consider the Hispanic market. So the message now is economic: Look at where the growth is. It’s in the Hispanic business community.
What are some specific issues that are important to the organization?
First and foremost, it’s to make sure that America recognizes the need for comprehensive immigration reform. Beyond that, the tried-and-true challenges: access to capital. Health-care and insurance reform is critically important. The numbers in the federal government are pretty abysmal. Hispanics make up 17 percent of the U.S. population, and we’re in the single digits for federal contracts.
You’re talking about Small Business Administration reporting on federal contracting. One argument I’ve read from agencies is that they couldn’t find women- or minority-owned businesses to meet their contracting needs. Do you buy that?
That’s bunk. Have you heard of the Billion Dollar Roundtable? It’s a coalition of 18 companies that are making sure to do $1 billion of business with companies that are women- and minority-owned. If Lockheed Martin (LMT), Ford (F), Verizon (VZ), Boeing (BA)—if those companies can figure it out, surely the government can.