In 2011, small businesses (with 10 to 100 employees) owned by Hispanic/Latinos had average revenues of $5.8 million and employed 22 workers. This article provides an industry profile of high-performing Hispanic/Latino-owned gazelles, based on information generated through the Gazelle Index national quarterly survey. The Index tracks information pertaining to the outlook, future hiring plans and current conditions of minority, women and non-minority small businesses.
The Gazelle Index survey results are based on a nationally representative sample of 631 responses from firms with 10 to 100 employees. The survey is stratified by race and ethnicity (i.e. African American/black, Caucasian/white and Hispanic/Latino) and by gender. The results for each group have a 5% margin of error.
The firms are called gazelles because they are high-performing small businesses. Years ago, David Birch popularized the concept of “gazelles” when his research revealed that small, high-growth firms accounted for the majority of new jobs in the economy. High-growth start ups were usually labeled “gazelles, during the internet bubble era of the 1990s. Over time, a 20% annual growth in revenue or employment became the unofficial threshold for defining gazelle status. However, there is no settled definition of what a gazelle is.
Furthermore, the recent recession has made it problematic to define gazelles based on a 20% annual growth in revenue or employment. This is because the challenging economy has caused the number of firms that experience a 20% annual growth to be exceedingly small. Therefore, by restricting the concept to high-growth companies only, we would have a sample that is so tiny the results would not be relevant to most small businesses.
Today, there are many high-performing small businesses and their employment capacity and economic viability are crucial to a healthy US economy. So rather than focusing on growth, we focus instead on employment size. The Gazelle Index defines high-performing small businesses as those having 10 and 100 workers. Nationally, this size category comprises 4% of the country’s 27 million small businesses but it also accounts for 24% of small business employment. The table below summarizes thei industry profile of Hispanic/Latino businesses.
Industry Profile of Hispanic/Latino High-Performing Small Businesses
- Largest Industry Concentration of Hispanic/Latino businesses: Construction, 28.0%
- Second Largest Industry Concentration: Retail/trade, 15.2%
- Average Revenue: $5.8 million
- Industry with Largest Revenue: Construction, $14.7 Million
- Industry with Smallest Revenue: Finance/Real Estate, $875,000
- Average Employment Size: 22 Workers
- Industry with the Largest Average Employment: Transportation/Warehousing, & Accommodation, 31
- Industry with the Smallest Employment: Retail Trade, Admin/Mgt, 18
- Average Employment Size: 22 workers