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A new study from Lendio ranks the top 20 states with the most minority entrepreneurs. To create the rankings, Lendio evaluated eight of his key indicators, including the availability of small business financing, entrepreneurship rates, employment growth, and income equality.
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Vermont has been touted as the state with the highest level of minority entrepreneurship due to high business loan approval rates, high growth rates for minority-owned startups, low unemployment rates, and low income inequality. Wyoming, South Dakota, North Dakota, New Hampshire, Montana, Maine, Utah, Kansas, Minnesota, Maryland, Idaho, Oregon, Colorado, Missouri, Nebraska, Florida, Ohio, Wisconsin and Massachusetts also made the list.
Notably, of the states with the highest absolute percentage of minority-owned businesses (Hawaii, Washington DC, California, Georgia, and Maryland), only Maryland made the top 20 list. Other businesses were pushed down in the rankings due to the fact that minority business ownership was lower compared to the state’s minority population, as well as other factors analyzed.
“Access to capital is essential for small business success, but there is a financing gap that minority entrepreneurs experience,” said Brock Blake, CEO and co-founder of Lendio. “This disparity, where white entrepreneurs outpace Asian, Hispanic, and Black entrepreneurs in securing financing, is a clear call for targeted policies and programs to close this disparity.”
According to 2022 Small Business Credit Survey data, 52% of white entrepreneurs are fully approved for a loan, compared to 35% of Asians, 28% of Hispanics, and 27% of Black applicants. It becomes.
“By shining a light on these issues, we aim to spur action to level the playing field for all entrepreneurs,” Block said. “We applaud governments and organizations that are working to provide policies and resources to support these underserved communities, and we commend new technologies in loan underwriting that make access to capital more equitable. I’m excited about the progress.”
To access the full study, visit Lendio’s website.
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