“Local businesses give warmth,” claim Coffee Links owners Leon and Ellie Araujo. “When you see [food] chains it feels like a cold city.” Leon and Ellie are proud owners of Coffee Links, an immigrant-owned business.

Ellie and Leon’s success story with their business is an important story to highlight. Originally from Mexico City, they immigrated to a new country in 2009 with their three kids. In 2013, they opened their first coffee shop, and today they have two thriving Coffee Links locations.

Entrepreneurship an underlying factor in fueling local economies. In other words, this is a pattern seen all over the world in assisting the economy. Entrepreneurs bring more than 50% to GDP and more than 60% of employment.

Furthermore, 25% of entrepreneurs are immigrant-owned and are positively influencing the economy, including job growth, unemployment, home values, and reduced vacancies.

Improving the Economy

Small businesses are a leading driver of poverty reduction. This is an alternative sector in socio-economic development that is alleviating poverty. According to the International Journal of Research Studies in Agricultural Sciences (IJRSAS), small businesses have had significant positive effects in both developing and developed countries.

Leon truly believes his business has contributed to the local economy, “The taxes give back to the community. All of it stays here in the community.”

When talking about why it is important to create local jobs, Leon Araujo answers, “The team is 50% of the support.” According to the Immigration Policy Center, immigrant entrepreneurs can contribute to local communities by modernizing neighborhoods and public areas, rejuvenating cities and towns.

More specifically, establishments like Coffee Links, a cafe/coffee shop, are the backbone of communities. Coffee Links, like many immigrant-owned businesses, attracts more local business and creates jobs. For example, it can generate direct hires, delivery drivers, cleaners, and suppliers. It can draw attention to collaborations with vendors, coffee roasters, florists, or bakers.

Barriers

“It is more difficult to be an immigrant entrepreneur,” says Leon, compared to being a native-born entrepreneur. Common barriers immigrant entrepreneurs face include language barriers and cultural differences. For example, learning a new language is difficult enough; trying to clearly communicate business ideas and follow regulations in a new language adds to the difficulty.

Leon claims there is one barrier immigrant entrepreneurs face that commonly goes unnoticed. It is a barrier to receiving financial assistance or loans. Leon Araujo is a legal resident of the country where he now lives, and he has had difficulty obtaining credit assistance from banks and credit unions, even though he is fully qualified. Many Hispanic entrepreneurs struggle to access financing and investors due to potential language and cultural barriers. According to The Statement, Hispanic immigrant entrepreneurs are more likely to rely on their savings than to take out a loan, seeking minimal funding. However, if they were to maximize their banking resources, they could potentially ”generate $1.4 trillion in additional revenue.”

Remittance

Many immigrant entrepreneurs send money to loved ones in their home countries. This is called remittance. Migrants who send money home have a significant impact on developing countries in Asia, Africa, and Latin America. In 2023, global remittances were estimated at over $800 billion.

“I do not send remittance to family in Mexico,” explains Leon, “I am invested in where I am now.” Although Leon may not send money home to family or friends, it is not uncommon for Mexican immigrant entrepreneurs to do so. Remittances sent home fund many Mexican households; about 4.5% of families rely on them. 

What does success look like now?

Mexican immigrant entrepreneurship, such as that of Leon and Ellie, strengthens local economies and contributes to global poverty reduction. Around the world, immigrants play a major role in launching new businesses, generating jobs, and stimulating local economic activity — all key components of long-term economic development. Additionally, remittances sent by migrant families provide more financial support to developing countries than traditional foreign aid, making them one of the most effective tools for reducing global poverty.

“When I first started the business, it was tough,” Leon says. He had to remember that success is not linear and there would be many ups and downs with the business. The most important thing was that he had to believe in himself.

Today, Leon has redefined what success means to him. He claims that he and his family have reached success and are open to anything that will expand the business. He continues to strive to develop a 3rd location

– Mireya Aguilar

Mireya is based in Layton, UT, USA and focuses on Business and New Markets for The Borgen Project. 

Photo: Flickr