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Researchers find minority-owned businesses don't grow as fast as majority-owned businesses

Researchers at Texas State University said minority-owned businesses start small and remain small. This is because they don't have the capital or guidance.

AUSTIN, Texas — As Austin grows, more businesses are setting up shop. Latinos continue to start businesses at faster rates than others. However, new research shows that they grow at a slower rate than non-minority-owned businesses. 

Delicious Tamales is one Austin business that opened up a few short months ago. Co-owner Herlinda Lopez-Wood said it all started up back in San Antonio. 

"My grandparents started Delicious Tamales in the 60s," she said. "Then my parents met in the 80s, and they started a Delicious Tamales. Then they incorporated in the 80s. And from there, it's grown."

For decades, they only had locations in San Antonio. 

"Back when my mom was younger, it probably was more challenging," she added. "Being a person of color or Hispanic to walk into a bank and be confident enough to say, you know, 'I need a loan.'"

Thankfully, they've been able to expand. Most recently, in Austin. However, like many minority-owned businesses, expansion hasn't happened as quickly as they hoped. 

"A lot of these family-owned businesses are small, small businesses in general," said Lopez-Wood. "You grow, and you grow, and when you reach a certain point, and you don't know how to get to the next step."    

Dr. Sidney Anderson is a research fellow at Texas State University's new SCALEUP program, digging into why minority-owned businesses start small and remain small.

"Some of them, maybe it's just lack of ability to identify what resources are out there," said Dr. Anderson. "Some of it is a lack of mentors."

SCALEUP Program Director Dr. Josh Daspit said if minority businesses grew at the same rate as non-minority businesses, it would benefit our economy. 

"That has the potential to add over $5 trillion to the U.S. economy and create over 20 million jobs in the United States," he said. 

In the meantime, Lopez will continue to work so their family-owned business reaches its fullest potential. 


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