August is Black Business Month, and thus an opportunity to shed light on the experience of Black owned businesses, and the entrepreneurs behind them. Owned and operated by Black women, our Firm knows first hand the importance of investing in this marginalized, yet growing community. Below is our take on why the need for Black entrepreneurs and businesses is more pertinent than ever.
The need for Black entrepreneurs has never been more urgent. In the United States, Black-owned businesses have long been underrepresented and underserved. Despite representing 13% of the population, Black-owned businesses make up only 7% of small businesses and receive less than 1% of venture capital funding. This lack of representation and support is not only a moral and ethical issue but also an economic one. Black entrepreneurs bring innovation, diversity, and economic growth to their communities and beyond.
One of the main reasons for the underrepresentation of Black entrepreneurs is the lack of access to capital. Many Black entrepreneurs have difficulty accessing traditional financing options, such as bank loans and venture capital, due to systemic racism and bias. This lack of access to capital makes it challenging for Black entrepreneurs to start and grow their businesses. However, this does not mean that Black entrepreneurs are not interested in entrepreneurship. According to a study by Guidant Financial, Black entrepreneurs are the most likely group to start a business out of necessity, meaning they start a business because they cannot find traditional employment.
Black entrepreneurs also face unique challenges in building and scaling their businesses. These challenges include access to mentorship and networking opportunities, a lack of representation in leadership positions, and discrimination. Many Black entrepreneurs lack the necessary connections and mentorship to succeed in business, which can make it difficult to navigate the complex landscape of entrepreneurship. Additionally, Black entrepreneurs often face discrimination in the workplace and in the broader business community, which can make it challenging to gain credibility and access to resources.
Despite these challenges, Black entrepreneurs continue to innovate and create businesses that make a positive impact on their communities. For example, Black-owned businesses are more likely to hire Black employees and provide goods and services that meet the needs of their communities. Additionally, Black entrepreneurs are more likely to create businesses that focus on social and environmental impact, such as sustainable agriculture and renewable energy.
To support Black entrepreneurs, it is crucial to address systemic racism and bias that create barriers to entrepreneurship. This includes increasing access to capital, providing mentorship and networking opportunities, and creating a more diverse and inclusive business community. In addition, supporting Black-owned businesses can have a significant positive impact on the economy. According to a study by the Association for Enterprise Opportunity, if Black-owned businesses were able to reach the same level of revenue as other small businesses, it could create over 600,000 new jobs and add $55 billion to the US economy.
Here at our Firm, we seek to empower Black owned businesses by providing services that take into account not only what they do, but who they are. Book a consultation today to secure your Black owned business.