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About the Biz2Credit Latino Small Business Credit Study

Biz2Credit, a leading online funding provider to small businesses, analyzed the financial performance of over 48,000 companies, including more than 5,600 Latino-owned firms, that submitted funding requests through the company’s online funding platform. All companies included in the survey have less than $10 million in annual revenues. The report covered small businesses across the country, from start-ups to established companies, from July 31, 2021 to June 30, 2022.

gqb-1 Our primary data shows relative success of Latino business owners compared to others. One reason is that business owners of all ethnicities struggled during the pandemic, and many loan applications came from non-Latino business owners in urban areas that were hit hard by the pandemic and government-mandated restrictions on their operations. gqb-2


Latino-Owned Businesses Versus Non-Latino Counterparts In Key Business Performance Categories During 2021-22

According to data gleaned from applications for financing in the past year, the following key facts emerged:
  • Average earnings (Annual Revenue - Operating Expenses) across all businesses decreased by 10.5%. Latino-owned companies ($123,487) had lower profits than non-Latino-owned firms ($151,821) in 2021-22.
  • Average annual revenues for Latino-owned companies ($538,588) was lower than those of non-Latino-owned firms ($583,502) in 2021-22.
  • Average operating expenses for Latino business owners is $415,101 in comparison to $431,680 for non-Latino business owners in 2021-2022.
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Latino-Owned Businesses Versus Non-Latino Counterparts In Key Business Performance Categories During 2021-22

  • Based on submitted applications, the average credit score for Latino business owners decreased from 638 in 2020-21 to 634 in 2021-22, while credit score for non-Hispanic business owners drop from 645 to 640.
  • The average age of business (in months) for Latino-owned businesses is lower (61.9) than for non-Latino businesses (66.8) in 2021-22. That’s approximately 5 years in business.

Loan Originations By State

The state where the largest number of financing applications from Latino-owned businesses was Florida (23.32%),

followed by California (18.23%), Texas (15.40%), New York (7.27%), New Jersey (4.49%), Illinois (3.19%), Arizona (2.96%), Georgia (2.89%), and Nevada (1.86%) in 2021-22 according to submitted applications.

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Loan Origination By Industries

Other Services (except Public Administration), the largest category of businesses represented 18.59% of the Latino-owned companies in the Biz2Credit study.

The industries that followed were:

  • Construction (16.8%)
  • Transportation and Warehousing (14.77%)
  • Retail Trade (10.66%)
  • Accommodation and Food Services (8.57%)
  • Professional, Scientific, and Technical Services (5.3%)
  • Healthcare and Social Assistance (4.03%)
  • Real Estate and Rental Leasing (3.51%)
  • Wholesale Trade (3.14%)
  • Arts/Entertainment (3.05%)
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Average Approved Amount For Latino-Owned Companies Is Lower Than For Non-Latino Companies

  • The average approved amount for Latino-owned companies was $24,529 less than for non-Latino-owned firms in 2021-22.
  • The average loan size for Latino-owned companies was lower than for non-Latino-owned firms in 2021-22.
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Sylvia Montez is the third owner of Apex Home Health, a home care business, located in San Antonio, TX. When she first entered the space, she saw that most of the agencies around her were run by business owners from different backgrounds than hers.

gqb-1 As a Latina, many doors wouldn’t open and I’ve missed out on many opportunities. But I was able to overcome it with companies like Biz2Credit. Even after the pandemic, the financial assistance I received brought the company to the next level and opened a lot of doors. It helped with marketing, not only door to door, but also with accessing web-based technology to grow my business. gqb-2

Latino-owned vs. Non-latino-owned firms (YEAR-OVER-YEAR COMPARISONS)

During the pandemic, businesses across the country saw a decline in performance across key metrics. However, on average, Latino-owned businesses have increased their revenue and earnings year-over-year (YoY) and outperformed their non-Latino-owned business counterparts in the annual trends for the same categories.

2021-22 vs. 2020-21 Percent Change

Key Categories Latino YoY % Change Non-Latino YoY % Change
Avg Annual Revenue +4% -5%
Avg Operating Expenses +2% -3%
Average Earnings +11% -11%
Avg Credit Score -1% -1%
Avg Age of business (in Months) -14% -11%
Source: Biz2Credit Latino-Owned Business Study for 2022

Latino-owned vs. Non-latino-owned firms (YEAR-OVER-YEAR COMPARISONS)

Latino 2021-22 2020-21 % Change Difference
Avg Annual Revenue $538,588 $519,476 +3.70% +$19,112
Operating Expenses $415,101 $408,241 +1.70% +$6,860
Average Earnings $123,487 $111,235 +11.00% +$12,252
Avg Credit Score 634 638 -0.60% -4
Avg Age of business (in Months) 61.9 72.4 -14.50% -10.5
Non-Latino 2021-22 2020-21 % Change Difference
Avg Annual Revenue $583,502 $613,578 -4.90% -$30,076
Operating Expenses $431,680 $443,022 -2.60% -$11,342
Average Earnings $151,821 $170,556 -11.00% -$18,735
Avg Credit Score 640 645 -0.80% -5
Avg Age of business (in Months) 66.8 75.4 -11.40% -8.6

Overall Growth Of Latino Businesses

  • There are an estimated 4.65 million Latino-owned businesses in the U.S., making them the fastest-growing segment of U.S. small businesses.
  • The number of Latino business owners has grown 35% in the last 10 years, compared to 4.5% growth among non-Latino-owned firms.
  • Latino-owned businesses employ over 2.9 million people, providing a growing source of employment across the U.S. The number of employees at Latino-owned businesses has grown 55% since 2007, compared to 8% among non-Latino owned business. According to the U.S. Census Bureau, Latinos are the second-fastest growing ethnic group. Source: Yahoo News, SBA State of Latino Entrepreneurship Report

The Latino Population Increased By A Greater Rate Than The Non-Latino Population

The Latino population, which includes people of any race, increase by 767,907 in 2021, 1.2% growth (62.57 million in 2020). Since 2010, the Hispanic/Latino population grew 23%, while the non-Hispanic/Latino population has only increased by 4.3%.

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Source: Census Bureau

Methodology Note To The 2022 Study

In the 2022 study, new data modeling and sampling techniques became available to Biz2Credit. We changed the method of considering whether an application for financing should be considered in the population data set due to these improvements in statistical modeling. Applications that contained valid bank account statements were the only ones considered, whereas in prior years the data set included those with partial or in some cases missing account statements.

We replaced null values and zeros with the gender-industrywide-yearly median (taken on the non-zero, non-null values only) for each variable. We used 1st percentile capping and 95th percentile capping for the following three variables i.e., age of business, annual revenue, and operating expenses. Values above the 95th percentile were replaced by the value at the 95th percentile. Values below 1st percentile were replaced by the value at 1st percentile.

The 2022 study used revenue and expenses calculated from bank statements received during the financing application. If a bank statement analysis was not available at the time of calculation, or in case of analytical error, we used self-reported revenue and expenses instead. In contrast, the 2021 study used self-reported revenue and expenses for all cases.

For full transparency, we’ve included in the Appendix the 2022 data calculating using the same methodology as the 2021 study used. This is done to provide a fair method comparison to the results taken from the 2021 study.

The four most important variables considered in pre-processing were:

  • Annual Revenue at application submitted
  • Operating Expenses at application submitted
  • Age of Business
  • Personal Credit Score at application submitted

Latino-owned vs. Non-latino-owned firms (YEAR-OVER-YEAR COMPARISONS)

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Yearly Comparison (Old Methodology)

Key Categories Latino Non-Latino
Key Categories 2021-22 2020-21 2021-22 2020-21
Avg Annual Revenue $290,402 $258,251 $247,299 $212,816
Avg Credit Score 607 614 600 610
Avg Operating Expenses $100,133 $95,526 $87,543 $80,063
Avg Age of business (in Months) 50.8 55 51.5 52
Average Earnings $190,269 $162,725 $159,756 $132,753

About the Biz2Credit Top 25 Cities for Small Business Study

Founded in 2007, Biz2Credit has arranged more than $7 billion in small business financing. Through its state of the art online platform, Biz2Credit directly offer business funding products. Biz2Credit believes small business funding should be easy to understand, easy to access, easy to use and always available when needed most. That is why Biz2Credit’s goal has always been to create the best and fastest small business funding platform.

To learn more and apply for business financing, visit or twitter @Biz2Credit, Facebook and LinkedIn

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