As the HispanicBusiness 500 celebrates its 30th anniversary, we take a look back to see how things have changed - or stayed the same, in many cases.
A trio of key trends and some exciting news emerge in this year’s HispanicBusiness 500 directory.
Respect remains elusive for smaller companies, especially women-owned ones; our largest companies are far outpacing the rest of the list; and the rise in revenues isn’t creating jobs—trends that we’ll explore below.
But the thing that makes us feel like proud parents listening to “Pomp and Circumstance”?
One of the ranking’s longtime top earners, Molina Healthcare, has graduated to the Fortune 500. It just barely made it, at No. 500—but it made it. And the HispanicBusiness 500’s ongoing golden child, Brightstar, has been flirting with the SEC since last year, so it may be next.
A Look Back
In 1983, the nation’s Hispanic population was a third its current size. The country had yet to see its first Hispanic astronaut or Cabinet member, and the U.S. economy was just beginning to climb out of a deep recession.
Little wonder, then, that just 400 Hispanic-owned businesses in the U.S. had revenues north of $1 million, the cutoff for making the inaugural index. The No. 1 company, General Coffee Corp., took in $275 million.
Three decades later, the HispanicBusiness 500’s No. 1 firm—wireless-communications company Brightstar—boasts yearly sales of over $5.7 billion. In 2011, the 500 companies on the list posted aggregate earnings of more than $37 billion, shattering the previous record set in 2006.
Over the course of three decades, just a handful of companies have topped the list.
They include liquor manufacturer Bacardi Imports in the late 1980s, the Burt Automotive
Network for much of the 1990s, communications infrastructure titan MasTec in the early 2000s, and, more recently, Molina and Brightstar.
However, other changes on the list reflect the steady advancement of Hispanic entrepreneurs.
“I’ve seen the list evolve significantly,” said Nina Vaca, CEO of Pinnacle Technical Resources. “In the past it was largely focused on construction or manufacturing.”
Today, the HispanicBusiness 500 includes firms in advertising, energy, health care and technology. Thanks to Brightstar, wholesale has become a huge revenue producer, with revenues of $7.8 billion shared among the sector’s top 10 companies.
As the ranks of the top Hispanic-owned companies have become more varied in type, so too has the gender makeup of the owners.
In 1985, the year in which the list expanded to 500 companies, just 28 female-owned firms were among them. Today’s number stands at 77.
But women still face a taller hurdle. Veronica Edwards, president and CEO of InGenesis, a health-care staffing agency out of Texas, said industry leaders still underestimate her company because it is female-owned.
“We’re happy to let them keep doing that,” she said. “It motivates us and provides us with the fuel to work a little harder and a little smarter.”
Although the progress of Hispanic enterprise in America is undeniable, it has not been steady.
For a time, the 500 seemed impervious to the setbacks experienced by the rest of corporate America. In 1992, when the Fortune 500 backslid nearly 2 percent, HispanicBusiness 500 revenues surged 10 percent.
By 1996, every company on the list was taking in at least $5 million annually. That minimum threshold climbed to $5.6 million in the heady days of the late 1990s and early 2000s.
It turns out 2008 was the top of the roller coaster. In June 2009, the combined fortunes of the 500 companies crested a hill: Total revenues had held fairly steady from the year prior, but—in the first true sign of trouble—the cutoff to make the list dropped below the $5 million mark, to $4.7 million.
It should be noted that some major companies left the list when they went public, because once they filed their IPOs they were no longer Hispanic majority-owned. Others have been absorbed by larger companies and simply no longer exist as independent entities.
That helps explain why the 2010 list showed a decline of nearly 17 percent. Overall revenues slipped from $36.2 billion in 2008 to $30.2 billion in 2009, and the size of the smallest company dropped to $1.3 million.
An Important Barometer
In some ways, Molina’s success is indicative of a larger trend in the HispanicBusiness 500: The recovery has generally favored larger firms while skipping over smaller ones.
Indeed, 2011 was a banner year for the list, with overall revenues rocketing to a record $37.3 billion.
But in 2011, the combined revenue of the top 100 companies accounted for 83 percent of the 500’s total earnings, the highest proportion in at least a decade. And in just one year, the growth of the top 100 exceeded 21 percent—by far the biggest single-year jump for the top quintile in a decade, if not the entire history of the list.
Meanwhile, despite robust sales, the number of jobs created by the 500 lags behind that of past years.
To be sure, the recovery of 2011 led to a spike in hiring, with the overall employee count surging 11 percent, to 127,706. But that total remains far short of the 147,000-plus jobs created by the 500 in 2006. In comparing those two years, there are 20,000 fewer employees to share nearly $1 billion more in revenues.
Molina, for one, has actually benefited from the rising unemployment rate. Its clinics largely specialize in serving patients on Medicaid.
“We have obtained additional office space and we are adding new physician offices across the country,” CEO J. Mario Molina told HispanicBusiness. “We recently opened clinics in New Mexico and Florida, and more are on the drawing boards.”
Geographically, the list was dominated by California for the first couple of decades. That ended in 2005, when Florida overtook the Golden State. Since then the gap has only widened, with Florida boasting 120 firms on the list and California with just 78.
Among the flourishing Florida companies is Zubi Advertising. Joe Zubizarreta, the company’s COO, says the HispanicBusiness 500 list has long been an important barometer.
“It’s just a great way to keep top of mind we are not only a powerful force from a population standpoint, but from a business and social standpoint,” he said.
What’s more, the list offers ample evidence that, now as never before, a top-tier Hispanic-owned company is a top-tier American company.
UPDATE: MicroTech inadvertently but significantly underreported its income for 2011 at $117 million. The correct figure is $342.2 million, moving the Virginia technology solutions company up to No. 21, and increasing the revenue of the HispanicBusiness 500 to $38.04 billion.