Among the worst
A new study shows that Wisconsin is the fourth worst U.S. state for minority entrepreneurs to succeed.
While a record 1.2 million minority-owned businesses are operating in the U.S., some states are better than others when it comes to supporting minority businesses. In the case of Wisconsin, 47 other states and the District of Columbia were better in this category over a recent multiyear snapshot, according to a study on the best and worst states for minority entrepreneurs by Lendio, an online loan marketplace.
Lendio used data from the Census Bureau and the Small Business Administration (SBA) and evaluated states on factors such as the percentage of businesses that are minority owned, job growth at these companies, and business loans to underserved communities. Overall, the study notes that 20% of entrepreneurs fail in the first year, but minorities have an even steeper hill to climb due to income inequality, limited access to loans, and other biases that result in a lack of capital needed to survive the startup phase.
The study provides some encouraging national data about minority business growth. More than half of the 2 million new businesses started in the U.S. over the past 10 years were launched by minorities, creating 4.7 million jobs, but people of color still own only 20% of U.S. businesses despite making up roughly 40% of the population, which contributes to income inequality.
The 10 best states for minority entrepreneurs are Hawaii, Maryland, Maine, Delaware, New Jersey, Florida, California, Virginia, Texas, and Idaho. Top-ranked states do the best job of increasing access to capital, providing business support programs, and building entrepreneurial networks.
Here are some key findings about Wisconsin, which ranked 48th among the 50 states and D.C., and the nation as a whole: