The battle behind Indy's Black business boom
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Illustration: Aïda Amer/Axios
As the number of new business filings climbs in Marion County, our count of Black entrepreneurs is also on the rise.
Why it matters: Despite annual gains that outpace the national average, access and capital challenges have kept these companies from putting a dent in the disparity between Indy's Black population and its tally of Black-owned businesses.
The big picture: Closing that gap could become even more difficult going forward as business owners navigate an investment landscape reshaped by rising anti-DEI sentiment.
Driving the news: Americans filed nearly 5.5 million new business applications in 2023, per the U.S. Census Bureau, or about 16.3 for every 1,000 residents.
- That's up from about 5.1 million in 2022 and 3.5 million in 2018.
- Compared to other states, Indiana was 28th overall with a rate of 13.6 per 1,000 residents.
Zoom in: Marion County saw some of the nation's largest gains with a state-leading 25.4 new business applications per 1,000 residents.
- That puts it in the top 100 counties.
- Hamilton (19.3) and Boone (16.1) counties round out Indiana's top three.
Between the lines: The latest Census data finds that pandemic-era growth saw the gross revenue of Black-owned firms surge by 66% from 2017 to 2022.
- During that period, the total number of businesses owned by Black Americans increased by 57%.
- A Yelp analysis revealed that Black-owned business openings in the Indianapolis area grew by 59% from 2022 to 2023.
Stunning stat: According to Lending Tree, 39.1% of Black-owned businesses across the U.S. are run by women, while just 22.3% of all businesses are run by women.
What they're saying: Matt Schulz, LendingTree's chief credit analyst, says hard times may have actually driven the uptick in Black-owned businesses.
- "There's no question that stubborn inflation and today's high prices are spurring more people to seek new ways to supplement their income," he said. "As the saying goes, necessity is the mother of invention, and it has never been easier or cheaper to start a small business than today, so it shouldn't be a surprise that more Americans are going that route."
Yes, but: Majority Black-owned businesses made up just 3% of all U.S. firms in 2022 when the population was about 14% Black, and accounted for just 1% of gross revenue.
- A separate Lending Tree analysis of the Census data ranks Indianapolis 42nd overall for share of Black-owned businesses, with 3.8% compared to a Black population of 15.1%.
- Of the 35,668 Indianapolis businesses counted by the Census, Lending Tree listed 1,343 as being Black-owned.
The latest: To help minority and women-owned businesses thrive locally, the city's Office of Minority and Women Business Development is conducting the city's first disparity study in five years to assess if businesses face any barriers related to the city's contracting processes.
- Officials provided an update on the yearlong study in January, saying the team has hosted public meetings, created a dedicated webpage and set up an email address to collect community feedback.
What's next: A final report should be complete by this summer.