A recent Volusion report on minority-owned startups found the Dallas-Fort Worth-Arlington area ranked 12th with 4,357 minority-owned startups.
That total represents 35.5 percent of area startups compared to an overall minority population of 52.4 percent. Those companies employ 23,992 people and have gross sales between $1 billion and $5 billion, according to the report.
The most active industry for area minority-owned startups is accommodations and food services. The report noted resources available to minority entrepreneurs, including organizations like the Regional Hispanic Contractors Association and the Fort Worth Metropolitan Black Chamber of Commerce.
The North Texas ranking was second in Texas behind San Antonio-New Braunfels at No. 6 (45 percent minority-owned startups) and just ahead of Houston-the Woodlands-Sugar Land at No. 13 (35.4 percent minority-owned). The Austin area wasn’t in the top 15 in Volusion’s rankings, which was topped by San Jose-Sunnyvale-Santa Clara, California—the only U.S. region to top 50 percent minority-owned startups at 56.5 percent.
Minority entrepreneurship is an ongoing conversation in the startup world with the report pointing out that while minorities make up almost 40 percent of the U.S. population, minority-owned startups account for just 27.4 percent of all startup companies.
Funding is a critical need for minority-owned startups
Lack of funding is a challenge for minority-owned startups that’s often cited.
A Morgan Stanley survey illustrated that issue, finding investments in minority- and women-owned businesses fall short by around 80 percent. Researchers pointed to increased risk perception and a lack of access and familiarity with minority- and women-owned startups for the gap.
Dallas has seen minority startup successes.
There’s digital content shop Blavity, which completed a $6.5 million Series A round in late 2018, and Kanarys’ $575,000 seed round earlier this year.
The Dallas Entrepreneur Center (DEC) has hosted Diversity Entrepreneur Days to support minority-owned startups, and this year’s Dallas Startup Week in April kicked off with Disrupt Dallas, an event that celebrated minority founders with a slate of panels and chats with local founders.
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