Port Authority Celebrates Black History Month by Supporting Black-Owned Businesses
Thursday, February 18, 2021
We celebrate the accomplishments of Black business owners and encourage the passion of Black entrepreneurs during Black History Month and beyond. The accomplishments of Black Americans in the business world are many and make a great impact, but inequality in the business environment of the United States still exists.
We Need to Improve
Black Americans own 2.2% of the nation’s 6 million businesses with employees and 7% of businesses overall, according to a survey by the United States Census Bureau. 36.1% of all Black-owned businesses are headed by women, making more Black-owned businesses women-owned than non-Black businesses.
While these numbers are impressive, they should be higher. Black Americans make up more than 13% of the U.S. population, but they only make up 7% of businesses overall, with and without employees (U.S. Census). Discrimination and systematic racism still play a part in businesss development.
Black business owners and entrepreneurs have been unfairly turned down by lenders, to the extent that Black-owned firms are twice as likely to be rejected for loans, according to a report by the US Federal Reserve. When Black business owners do get approved for financing, they seldom receive the full financing applied for. Black female business owners are less likely to apply for business loans, but when they do, they are even more likely to be turned down than their male counterparts (US Federal Reserve).
The wealth gap contributes to the inequities as well. Annually, Black-owned businesses averaged $58,000 in revenue while White-owned businesses averaged over nine times that amount, studies by Prosperity Now report.
Still, business ownership has always been a great equalizer, creating opportunities for any American to launch their idea, turn a profit and grow their business. We must ensure that all entrepreneurs have equal access to the resources and network they need to grow. That’s where local community leaders can make a sizable impact - through direct outreach and support.
Nationwide Resources for Minority-owned Businesses
Economic development agencies, government officials, nonprofit organizations and the private sector are partnering to address these disparities and provide more support to the Black community. These efforts include working toward closing the funding gap for Black-owned businesses. State and nationwide initiatives are providing more opportunities for Black-owned businesses to receive the funding they need and to make training programs more accessible to minorities.
The Minority Business Development Agency, an extension of the U.S. Department of Commerce, promotes the growth of minority-run small businesses by introducing business owners to resources for financing, federal contracts, technical assistance and market opportunities.
Businesses who are at least 51% owned and controlled by a citizen who has been economically disadvantaged due to race or ethnicity are eligible for SBA 8(a) Business Development assistance. This assistance may consist of help securing SBA-backed loans, business-education and guidance programs and opportunities to build connections in the business community.
Operation Hope offers small business owners entrepreneurial training programs, small-business workshops and networking opportunities. In addition to training, Operation Hope helps business owners develop a small business plan and gain access to funding and resources to grow their businesses.
The National Minority Supplier Development Council advances business opportunities for minority-owned businesses by facilitating connection to a network of corporate members who need their products, services and solutions.
The CDFI Fund invests federal dollars alongside private sector capital to support economically disadvantaged communities. Organizations that apply for the CDFI Fund programs may be able to assist Black-owned businesses in acquiring loans, financial services and technical assistance.
Federal grant opportunities are posted in one location on Grants.gov. Business owners can choose to apply for grants from a variety of agencies and sources here.
The Founders First Capital Partners works on a revenue-based investment model for service-based companies led by minorities. Payments are determined from cash flow, offering business owners a more flexible payment model.
In addition to these excellent resources, organizations like Prosperity Now, Black Business Association, U.S. Black Chambers, Inc. and Code2040 support and advocate for Black-owned businesses nationwide through education and the creation of resources and initiatives.
Minnesota Initiatives to Support Black-owned Businesses
The Minnesota Emerging Entrepreneur Loan Program supports the growth of businesses owned and operated by minorities as well as low-income persons, women, veterans and/or persons with disabilities. Nonprofit lenders use DEED provided funds for loans that assist start-up and expanding businesses that meet previously stated requirements throughout the state. The program also works to provide jobs for minority and/or low-income individuals and strengthens minority business enterprises.
The Minnesota Black Chamber of Commerce empowers Black-owned businesses and the people who support them with education, advocacy and economic development. The chamber provides access to small business loans, mentorship programs and workshops in order to maximize the potential of every Black-owned business and offer equitable opportunities for growth at every stage of business development.
Legal guidance is a necessity in the journey to starting and maintaining a business. The Entrepreneurs of Color Program makes legal services more accessible to Black business owners, recent immigrants and other minorities. The program provides support to small business owners and those who would like to start a small business who are from historically marginalized communities through business law resources.
African Economic Development Solutions is an excellent resource that provides access to entrepreneur promotion and training, small business technical assistance, micro-lending, financial education and community development in order to build wealth within African immigrant communities.
The African American Leadership Forum (AALF), Black Women’s Wealth Alliance (BWWA), Just Law LLC, Minnesota Black Chamber of Commerce (MNBCC), Northside Economic Opportunity Network (NEON), Neighborhood Development Center (NDC), Social Impact Strategies Group (SISG), and West Broadway Business and Area Coalition (WBC) have partnered to form the Black Business Support Collective (BBSC) whose mission is to assist Black entrepreneurs in the many challenges they face as a result of the COVID-19 pandemic.
To learn more about how Red Wing Port Authority can support your business, contact us today.