November 18, 2004
By Regan Morris
Hispanic women are opening businesses at a rate far higher than the national average, a new study shows. To Tina Cordova, a Hispanic entrepreneur, the reason is obvious: economic desperation. While white women in the work force make about 77 cents to every dollar earned by white men, according to data from the 2000 census, Hispanic women are paid 53 cents.
With numbers like that, Ms. Cordova, 45, the president, majority shareholder and chief executive of Queston Construction Inc. in Albuquerque, said it was no wonder that so many Hispanic and other minority women take the plunge into entrepreneurship.
When she started her company in 1990 with $5,000 in savings, Ms. Cordova figured she had nothing to lose. After all, she said, if she failed she could always go back to her previous jobs as a waitress and a restaurant manager.
Many other minority women have made similar decisions to start businesses. Between 1997 and 2004, the number of firms owned by Hispanic women increased by nearly 64 percent, to 553,600, and their combined revenue climbed by more than 62 percent, to $44.4 billion, according to a study by the Center for Women's Business Research that was released Tuesday.
The number of privately held firms that are 51 percent or more owned by minority women rose by 54.6 percent, compared with a 9 percent increase in the number of all privately held firms in the United States, the study said. The number of firms run by African-American women rose by 33 percent, to 414,472, the center said.
Over all, an estimated 1.4 million companies are owned by minority women in the United States, generating nearly $147 billion in sales. Hispanics accounted for 39 percent of the companies, while African-Americans accounted for 29 percent. Asian-Americans and Pacific Islanders, who were grouped together, also accounted for 29 percent. Native Americans and Native Alaskans made up about 6 percent, the study said. (The numbers add up to more than 100 percent because some business owners were classified in more than one category.)
Myra M. Hart, co-founder of Staples and a professor at Harvard Business
School, attributed the surge in part to limits to professional
advancement that many women still experience in the workplace.
"If you sit down and say: 'Well, what's the best alternative to
starting this business?,' the alternatives don't look that attractive,"
said Ms. Hart, who is chairwoman of the Center for Women's Business
Research.
Ms. Cordova started her business from her home and asked clients to pay
half the cost of the projects up front, allowing her to buy materials
and pay the two carpenters she had hired. In its first year, Queston's
revenue was about $55,000. Last year, it was $2.5 million, down from a
high of $3 million in 2002, though Ms. Cordova projects it will bounce
back to $3 million next year because of the booming construction market
in New Mexico. The company is profitable, but keeping it that way has
been a struggle.
Initially, the biggest challenge was getting financing. Now, it is
coping with the soaring costs of materials, fuel, insurance and
supplies. "I think instead of having an estimator in our bid room, we
really should have a psychic, because we really don't know what the
cost of materials will be from one month to the next," Ms. Cordova said.
To cope, she said that she and Russ Steward, who is her companion as
well as her business partner, pinch pennies in their business and
private lives and stay out of debt. She said they had put off building
their planned retirement home.
Ms. Cordova, who had once dreamed of becoming a doctor, discovered her
business skills at a restaurant franchise. She earned a master's degree
in biology from New Mexico Highlands University, but she needed a job
fast when she divorced and dropped out of medical school at the
University of New Mexico. Despite her education, she couldn't find work
in her field and ended up waiting tables at a Sizzler restaurant in
Albuquerque.
She asked her boss to let her work as his administrative assistant and
help with his expansion plans. She discovered that she had a flair for
business, and when she left the company about two years later she was
operations supervisor, overseeing three restaurants.
Mr. Steward had owned a construction company, but it failed because it
lacked a good administrator, Ms. Cordova said. With Ms. Cordova's
administrative skills and Mr. Steward's project-management experience,
the couple decided that they had the ingredients for a new company. Ms.
Cordova quit her job and started the company, while Mr. Steward, who
worked for another construction firm, helped at night and on weekends.
To learn the ropes, Ms. Cordova worked as a laborer on construction
sites with Mr. Steward and her two carpenters, at first lugging wood
and tools but eventually becoming one of the first women in New Mexico
to earn a contractor's license.
Another major challenge was raising money. She did not know any bankers
and was repeatedly turned down for loans. She could not even get a
$5,000 loan for a used truck, and instead bought an older one with
$1,200 from her savings.
The decision to buy a small roofing company turned their venture
around. Ms. Cordova started selling new roofs along with the remodeling
jobs, and the added profit enabled her to employ Mr. Steward full time
and to buy a property, an office trailer and work space.
Even then, to her great frustration, the bankers would not loosen their
purse strings. "We were quite successful,'' she said. "We certainly had
the money in the bank to collateralize a loan, to say nothing of the
fact that the property was worth much more than we were asking to
borrow."
The rejections Ms. Cordova experienced did not surprise Sharon Hadary,
executive director of the Center for Women's Business Research, who
said that women and minority business owners operate at a distinct
disadvantage in competing against white men, even today. "They aren't
connected into the boy's network," she said.
Mr. Steward helped Ms. Cordova master the roofing business, and she
worked on the hot tar roofs in the scorching New Mexico summers. Still,
some people were not convinced a woman could be successful in
construction. She said one potential client told her he would never buy
a roof from a woman. When another customer asked why the company had
not sent a man to make an estimate, Ms. Cordova told him that she owned
the business, was the most educated person in the company and knew just
as much about roofing as the men who worked for her. "And it was really
bizarre, because he bought the roof from me that day, which rarely
happens," she said.
Even without outside capital, the company flourished, and today employs
28 full-time workers, including Ms. Cordova's son and a nephew. (Her
father also worked there until his recent retirement.)
The company still does residential work, but now gets most of its
business from government contracts, a result of direct, aggressive
marketing by Ms. Cordova. She made contacts through the United States
Hispanic Chamber of Commerce and by attending workshops on how to do
business with the government.
Ms. Cordova, who missed just five days of work while battling thyroid
cancer six years ago, said her talent lay in turning what appeared to
be disadvantages into advantages.
"If I had listened to everybody who told me we wouldn't make it, of course we wouldn't be here today," she said.
She said entrepreneurs need to be stubborn, but they should not stick
rigidly to business plans. "I wish I could say I had this business
plan, we followed it, and everything just fell into place," she said.
"That is not true. Because it's more often than not being in the right
place at the right time. I started a business at the right time."
Source: The New York Times
