A report by Merchant Maverick, a comparison site that reviews small business software and services, highlighted the top ten states for African American entrepreneurs in 2022. The results showed that eight of those states were home to HBCUs and the other two were Nevada and New Mexico, respectively. It certainly is likely that HBCUpreneurs are driving the African American entrepreneurship in these states. Unfortunately, it maybe more indirectly than intentionally. It does suggest though that with more intentional infrastructure these states could see even more boom in entrepreneurship for HBCUpreneurs. What is that intentional infrastructure? Incubators, accelerators, mentorship, and financing programs located on the campuses of HBCUs or through their alumni associations in partnership with African American Financial Institutions (AAFIs).
Virginia: Thanks to a trio of top five metrics, Virginia ranks soundly in the No. 1 spot. Black-run businesses employ 2.18% of the Old Dominion’s workforce (2nd nationally), and there are 755 Black-owned employer businesses per 1 million people (3rd nationally). Black-owned businesses also average an annual payroll of $437K, which ranks 5th overall. The state previously fared well in some of our other data reports — Virginia finished as the 4th-best state for Black women-owned businesses, and it ranked 10th in our recent best states for women-led startup report. In an effort to grow local minority-run businesses and encourage contracts with those businesses, the Virginia state government operates a directory of all certified small businesses within the state.
Maryland: With Black residents comprising 31% of the population, Maryland has the highest percentage of Black residents of any state on the East Coast, and the 4th-highest in the nation. As such, it shouldn’t be much of a surprise that Maryland has many Black business owners. The Free State ranks 1st nationally for the most Black-owned businesses per 1 million people (1,213), and also ranks 1st in percent of the workforce employed by Black-owned businesses (3.49%). Black-owned Maryland businesses additionally average a very respectable annual payroll of $465K, which is the 4th-highest in the nation. The state government offers several tools for minority business owners, including funding, small business certifications, and assistance programs.
Texas: While no metric clearly stands out, Texas ranks highly thanks to consistency. Black entrepreneurs may find it profitable to start a business in the Lone Star State — Black business owners average an annual income of $64,240 (10th overall) and Black-run businesses in the state average an annual payroll of $337K (17th overall). All of this cash can go further in Texas because the state lacks income tax. Resources available to local Black businesses include the Texas Black Expo and the Dallas Black Chamber of Commerce, both of which are organizations that aim to assist underserved businesses.
For the full report, visit Merchant Maverick here.
HBCU Money 