New data shows that Houston communities saw an uptick in startup founding from Black entrepreneurs. Photo courtesy

It might seem that the formation of startups would have stagnated amid the COVID-19 pandemic. Yet that was anything but the case for Houston startups founded by Black entrepreneurs.

A recent study by economists at Rice University, Boston University, Columbia University, and the Massachusetts Institute of Technology (MIT) found that from 2019 to 2020, the startup rate rose 32 percent in four largely Black areas of Houston: Kashmere Gardens, Missouri City, South Acres, and Sunnyside. By comparison, the statewide startup rate during that period was only 10 percent.

There's no denying that Black-owned businesses already have a significant impact on the economy of the Houston metro area.

A report released in 2019 by the Greater Houston Black Chamber estimated the group's more than 1,500 members collectively generate anywhere from $1 billion to $2 billion in annual revenue. A little over one-fifth of the population in the Houston area is Black. That population is projected to grow 34 percent between 2010 and 2030.

In 2015, personal finance website NerdWallet ranked Houston the 15th best metro in the country and the best metro in Texas for Black-owned businesses.

The Rice economist who contributed to the study is Yupeng Liu, a doctoral student at the university's Jones Graduate School of Business. While he and his fellow researchers note that their study doesn't confirm a cause-and-effect relationship, "it is useful to note that the federal relief payments, and their uniform distribution (independent of eligibility criteria), may have played a role in enabling new firm formation in Black neighborhoods which might otherwise have been constrained by discrimination."

Furthermore, some experts speculate that last year's rise of the racial justice movement may have helped lift up Black entrepreneurs, and that many Black Americans set up new businesses out of necessity in 2020 after being laid off or seeing their work income or hours reduced.

The study, published by the National Bureau of Economic Research, compared startup data for 2020 in Texas and seven other states — Florida, Georgia, Kentucky, New York, Tennessee, Vermont, and Washington — with startup data for 2019. In all, the number of business formations spiked by 21 percent, with the growth of Black-owned startups being especially pronounced. However, an estimated 40 percent of Black-owned businesses closed during the pandemic, compared with 20 percent across all racial and ethnic groups.

The findings of the research bureau's study mirror a subsequent report from the Ewing Kauffman Foundation, a nonprofit that promotes entrepreneurship. The report found more Black-owned businesses were launched last year compared with the total population than at any time in the past 25 years, according to the Los Angeles Times. On average, 380 out of every 100,000 Black adults became new entrepreneurs during the 2020 pandemic, up from 240 in each of the previous two years, the report shows.

In reporting on the National Bureau of Economic Research study, CBS News and The New York Times spotlighted two new Black-owned startups in Houston.

Last July, Destiny McCoy and Oyinda Adebo of Houston launched a mental health company called Wellness for Culture. The company already has been so successful that McCoy says it now supports her financially, according to CBS News.

"All I knew is that I wanted to help Black women," McCoy told CBS News, "and all I knew was I didn't want to do therapy in the typical way."

Another Black entrepreneur from Houston, Pilar Donnelly, enjoyed similar success in 2020. Last summer, Donnelly began making playhouses for her two 6-year-old boys, the Times reported.

"She had been laid off from her job in sports marketing and wanted to give them something for their birthday. With no background in woodworking, she started off with a design she liked online and watched YouTube to learn woodworking techniques," according to the Times. "After making a number of playhouses for her friends and family, she realized it could be a business. That business, which she registered in June, is called Wish You Wood Custom Creations."

Woodworking is now Donnelly's full-time job.

"Everyone I encountered either had a really good year or a really bad year — and for me I had a good year," she told the Times. "Now I'm working outside in the grass and the dirt. I have a workshop in the garage; I have scrap wood everywhere. My life is really different."

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Intuitive Machines secures $175M equity investment to fuel growth

space funding

Houston-based space infrastructure and services company Intuitive Machines has secured a $175 million equity investment from unidentified institutional investors. The investors received shares of Class A stock in exchange for their funding.

Publicly held Intuitive Machines (Nasdaq: LUNR) says it plans to use the capital to help build revenue and invest in technology, including communications and data-processing networks.

“We are building a scalable infrastructure platform from low-Earth orbit to the moon and into deep space,” Intuitive Machines CEO Steve Altemus said in a news release. “With this investment, we can accelerate the integration of the combined company’s collective capabilities to deliver next-generation data, communications, and space-based infrastructure services.”

Intuitive Machines says the $175 million investment will improve its ability to secure deals for satellite systems, the proposed Golden Dome missile defense system and the proposed Mars telecommunications orbiter.

As the company pursues those deals, it’s seeking partners to develop space-based data centers.

The $175 million equity stake comes on the heels of Intuitive Machines completing its $800 million cash-and-stock purchase of Lanteris Space Systems. Intuitive Machines bought the satellite manufacturer from private equity firm Advent International.

In the third quarter, which ended Sept. 30, Intuitive Machines posted a $10 million net loss on revenue of $52.4 million.

Houston startup debuts bio-based 'leather' fashion collection in Milan

sustainable fashion

Earlier this month, Houston-based Rheom Materials and India’s conscious design studio Econock unveiled a collaborative capsule collection that signaled more than just a product launch.

Hosted at Lineapelle—long considered the global epicenter of the world's premier leather supply chain—in the vaulted exhibition halls of Rho-Fiera Milano, the collection centered around Rheom’s 91 percent bio-based leather alternative, Shorai.

It was a bold move, one that shifted sustainability from a concept discussed in panel sessions to garments that buyers could touch and wear.

The collection featured a bomber-style jacket, an asymmetrical skirt and a suite of accessories—all fabricated from Shorai.

The standout piece, a sculptural jacket featuring a funnel neck and dual-zip closure, was designed for movement, challenging assumptions about performance limitations in bio-based materials. The design of the asymmetrical skirt was drawn from Indian armored warrior traditions, according to Rheom, with biodegradable corozo fasteners.

Built as a modular wardrobe rather than isolated pieces, the collection reflects a shared belief between Rheom and Econock in designing objects that adapt to daily life, according to the companies.

The collection was born out of a new partnership between Rheom and Econock, focused on bringing biobased materials to the market. According to Rheom, the partnership solves a problem that has stalled the adoption of many next-gen textiles: supply chain friction.

While Rheom focuses on engineering scalable bio-based materials, New Delhi-based Econock brings the complementary design and manufacturing ecosystem that integrates artisans, circular materials and production expertise to translate the innovative material into finished goods.

"This partnership removes one of the biggest barriers brands face when adopting next-generation materials,” Megan Beck, Rheom’s director of product, shared in a news release. “By reducing friction across the supply chain, Rheom can connect brands directly with manufacturers who already know how to work with Shorai, making the transition to more sustainable materials far more accessible.”

Sanyam Kapur, advisor of growth and impact at Econock, added: “Our partnership with Rheom Materials represents the benchmark of responsible design where next-gen materials meet craft, creativity, and real-world scalability.”

Rheom, formerly known as Bucha Bio, has developed Shorai, a sustainable leather alternative that can be used for apparel, accessories, car interiors and more; and Benree, an alternative to plastic without the carbon footprint. In 2025, Rheom was a finalist for Startup of the Year in the Houston Innovation Awards.

Shorai is already used by fashion lines like Wuxly and LuckyNelly, according to Rheom. The company scaled production of the sugar-based material last year and says it is now produced in rolls that brands can take to market with the right manufacturer.

Houston startup debuts leather alternative fashion collection in Milan