How Hispanic-Owned Businesses Can Thrive in Government Contracts

Although Hispanic-owned businesses are among the fastest growing groups of entrepreneurs in the United States, the government has historically awarded few government contracts to these businesses — or even those owned by other minorities.

This is especially true in the field of cybersecurity and particularly in the field of cybersecurity. In 2021, the Ministry of Labour reported that only 5% of businesses registered to receive federal contracts have Hispanic owners. The number of people who have actually won these highly sought-after contracts is much lower.

The current presidential administration is seeking to level the playing field for underserved small business owners. That’s why now is the time for Hispanic entrepreneurs to break into the public markets.

Why the lack of diversity in the first place?

“Diversity” isn’t just a word for making companies feel good about their culture. Having a diverse workforce is essential for innovation, better decision-making, and building a more agile government. So why are there so few Hispanics in public markets anyway?

Overall, the Hispanic community has little awareness of this industry and its opportunities. Combined with a disproportionate lack of access to higher education, job training, social capital and financial aid, this dynamic means that many Hispanic entrepreneurs do not even consider contracting with the government.

The same goes for cyber jobs: the inaccessibility of higher education and advanced programs is a major reason why so few Hispanics are entering tech-related fields. These sectors often require specialized skills and certifications which, due to systemic inequalities, can make expensive education a real disadvantage.

So why should Hispanic business owners even get into this industry?

The possibilities for public procurement are almost endless. After all, according to White House, the federal government is the largest consumer of goods and services in the world, spending nearly $600 billion a year.

Now, more than ever, the government is trying to help minority-owned small businesses grow and compete. If you’re an established business already providing commercial cybersecurity services, consider government as another target market to sell to.

For founders just starting out, focusing solely on selling to government can help you find your niche and establish credibility. A multitude of resources can help you, even if you know very little about government contracts.

How to start?

Do your homework, starting with some Google searches. The government puts a ton of information online that can help you get started. Learn how to find open offers, respond to a proposal, and fully understand the rules and regulations that government customers follow. Once you’ve done some initial market research, create a business plan, build your business credit, develop an operating agreement, and establish a strong online presence.

There is also immense value in networking and mentoring with other industry professionals. Hire a business coach and explore joint venture programs with larger organizations. If you have served in the military before, use that knowledge and leverage existing relationships to move forward. Also crowdsource professionals such as your accountant, banker, and lawyer; These people can offer a wealth of knowledge and invaluable advice.

Be sure to use, too. The Small Business Administration (SBA) is an absolute gold mine, offering a myriad of free resources and training specific to minority groups. This SBA article details some of the tools Hispanic entrepreneurs can leverage.

And don’t try to sell everything to everyone. Penetrating many agencies from the start will only set you up for failure. Determine which agency you want to target first based on what you do best.

What opportunities exist?

The federal government wants to award contracts to small businesses whenever possible. It currently allocates 5% of all federal contract dollars to help disadvantaged small businesses compete with larger, more established ones. [Editor’s note: Read our Checking the Box series for more on diversity in government contracts.] The Biden administration is expected to increase that share to 15% by 2025. As a Hispanic business owner, the reserves are there to help you get your foot in the door of government. They level the playing field and give small businesses a priority opportunity to do business.

We badly need more Hispanic representation in federal contracts and technology. Policies change with new administrations. But here, right now, the federal government is providing incredible opportunities for minority business owners that cannot be ignored.



Comments are closed.