This is a featured blog via Finimpact.
Black Lives Matter is affecting the world in a profound way, bringing the plight of African Americans into the limelight. Its effects are far-reaching, and it is occurring in tandem with the COVID-19 pandemic to make it even more difficult to run a successful business.
Below, we will outline the implications and demonstrate how to help Black-owned businesses out amidst the current situation, as a show of support and solidarity.
Black Lives Matter – The Implications
Black Lives Matter is alerting the USA to the social injustices of black people not only in a general sense. In academics, economics, business, finance, law, and practically all other spheres, black people are under-represented. It has started a revolution of sorts as protests take place across the USA for equality.
In terms of social class, the average total net worth of a white family was 10 times that of a black family in 2016. The main reason for this, however, is heralded as being a lack of inherited generational wealth as opposed to systemic racism. Almost 20% of Black families have debt that exceeds their assets, due to a combination of a lack of financial education and a lack of generational wealth.
The National Association for the Advancement of Colored People (‘NAACP’) is the most prominent organization in terms of education, financial empowerment, and social equality for Black citizens. Their 2016 Black Lives Matter pamphlet included 11 tips to help Black children become more financially aware, how to increase Black ownership of franchises, and how to promote entrepreneurial leadership within Black communities.
The Black Lives Matter movement has been going on for some time. It was actually founded in July 2013 to protest police brutality against African Americans. However, it has now reached a global level with the recently recorded death of George Floyd in Minnesota at the hands of a white police officer. This most recent event has led to mass protests across the USA with riots and looting in response.
A History of Thwarted Black Wealth?
There is little question that the unfortunate history of black people in America is what has led to the current inequality. The primary reason for the lack of Black wealth and their under-representation in business is due to the treatment of previous generations. This has led to an infrastructure where other demographics benefit from inherited wealth, go to the best schools, and get the best jobs. In contrast, black people do not have any of these benefits in terms of wealth acquisition and are starting off on a much weaker platform to grow their income potential.
This is not a controversial point and is well-grounded in history and reputable reports. In the 1850s, New York actually destroyed a Black-owned village to create Central Park. Black business owners were commonly lynched throughout the 19th and 20th centuries. After the second world war, Black veterans were excluded from many benefits in terms of homeownership, benefits promised to other groups.
‘If you pay attention to the literal campaign of terror against black Americans in this country, what you’ll see is a lot of it was carried out against black business owners or anyone who was perceived as accumulating wealth.’
Khadijah Robinson, ‘The Nile List’ Founder
Needless to say, the issue is a mix of historical prejudice and current inequalities. Regardless, it needs to be remedied, and you can do this if you lend your support to Black-owned businesses. Any group that is a victim of inequality will ultimately hurt the entire nation.
Fortunately, there are many ways to demonstrate support and build a better nation with small but impactful actions.
How to Support Black-Owned Businesses
There are various ways that you can help black-owned businesses to survive COVID and to show your support for the current Black Lives Matter movement sweeping the USA. A primary way to help is to divert your spending towards Black-owned businesses. But this is by no means the only way to ensure social solidarity amongst US citizens, and there are many paths forward. Some of these mechanisms are outlined below.
Use Social Media
Social media remains one of the best ways to make a positive impact on Black business owners. After all, it’s free. Make your voice heard, follow leaders that you trust within this movement, and follow Black-owned businesses on Twitter and Facebook. Get your friends involved and cite some studies and statistics on the subject matter to generate awareness. Social media is probably one of the most powerful tools at your disposal to assist.
This is not merely a fad. Black-owned businesses have received an upsurge in sales amid the protests, and this has largely been attributed to social media awareness generation campaigns.
This is in spite of the fact that Black-owned businesses have been the hardest hit as a result of the COVID downturn.
The outcry among the public is turning to actual sales for Black business owners, and this is but one example of how Black people are being empowered due to a tangible movement that aims to assist a unique demographic group.
By simply understanding the obstacles that Black business owners face and the history of black people in America, you will be doing a lot to assist. It will help you to explain it to others and to see why this is an underprivileged group that needs support and attention at the current time. It always helps to stay informed and to know the figures.
For example, while corporations are saying they are going to address concerns, they tend to have a poor track record. And in a survey of Black economists carried out by the American Economic Association, only 14% agreed with the statement that “people of my race/ethnicity are respected within the field.” The more you know about any particular issue, the better you can respond to it and ultimately resolve it.
Without being made aware of such issues, the problems will not be addressed. As a consumer and a citizen, you have the financial and social power to help out disempowered groups, and this particular group is clearly disempowered.
Make Black Purchases
Try to shop with Black-owned businesses in your local area to give them some financial support amidst the disaster. It’s important to make a distinction here. You are not ‘anti-white’ – you are ‘pro-black’. There is a huge difference between attacking one group and empowering another.
In terms of racial discrimination, it is typically a tiny percentage of any one group that is causing all of the difficulties. So make purchases at Black stores, but don’t feel you need to ‘boycott’ white stores.
There is even a 30-day ‘Buy Black Challenge’ campaign that is getting started. This started on June 19th and will help you find Black stores and make a positive impact by highlighting the benefits of these stores and making a financial contribution. Each day, businesses in different industries are highlighted. The idea is to start a trend so that more and more people will buy Black, year-round.
Be Actively Involved
With the Black Lives Matter Movement sweeping the world, there are tonnes of petitions, movements, and organizations that you can join to better the lives of black people in the USA. You might even consider being a group leader, attending a peaceful protest/event, or setting up your own petition. Needless to say, you will be making a peaceful protest. Riots never solved anything, and they never will.
If you feel strongly about the matter, be intelligent with your words, your money, and your voice. Don’t just end up in jail or destroy someones else’s business because you are not in control of your emotions. In order to be actively involved, it definitely helps to understand what is going on and do your research (as mentioned in a previous point).
Donate Directly to Black Businesses
Many Black-owned businesses have been hit very hard with the recent COVID crisis and have also been victims of looting during the protests. You can make a direct financial contribution to help out. It does not have to be a huge sum of money, and every little helps. The alternative to this, as mentioned above, is to make purchases at Black-owned stores. Many initiatives are in place for you to find and fund local and national Black-owned businesses.
Premier Resources For Black Businesses
There are multiple programs that have been specifically designed to help Black business owners given the unequal challenges that they tend to face. Using these resources can help to level the playing field. The following is not an exhaustive list but contains the more prominent resources for Black-owned businesses.
- National Association for the Self-Employed – This allows grants up to $4,000 for Black business owners. It is one of the foremost resources, providing training, networking, events, seminars, education, grants, and many other facilities. It can really help business owners to get started and also provides consultancy, life insurance, and medical emergency assistance. It is not only for Black business owners but for many other eligible groups.
- Black Women Enterprises – Black Women Enterprises (‘BWE”) has its headquarters in New York City and offers numerous services to Black women in business. Its core mission mandate is to remove the barriers against economic success for Black women. Interestingly, they also say that they are open to all women, as they do not discriminate, though their primary focus is on Black female entrepreneurs. Membership with BWE is completely free.
- Millennial Entrepreneurs Redefined – This is available for minority persons (including black people) aged between 18 – 35. Currently, live workshops are operational in 7 cities: Atlanta, Detroit, Washington D.C, Dallas, New Orleans, St. Louis, and Oakland. The aim is to assist minority millennial entrepreneurs to get up and running with coaching and training. The initiative is powered by the US Black Chambers Inc Community Development Corporation. It is partnered with the Black Business Empowerment program.
- DreamSpring – This is not directly aimed at Black business owners. However, it does tend to empower minority groups. It is available to all types of business owners in Arizona, Colorado, Nevada, New Mexico, and Texas. This non-profit has been in operation for over 26 years and provides loans up to $2 Million.
- Black Enterprise – This is not a funding or training organization. Instead, this is actually an online publication that serves the Black community by highlighting key trends in the industry and motivates Black entrepreneurs. Another popular online journal is the Minority Business Entrepreneur.
- Black Founders – Black Founders is aimed at the empowerment of Black people in the technology sector. They have created a global network that allows Black people to share resources and connect. This is a very popular resource for Black entrepreneurs in the technology niche and has been featured in the Huffington Post, Black Enterprise, and MSNBC. They provide conferences, connections to funding, hackathons, and educational resources.
- Black Business Association – This is only available to Black business owners in the state of California. It is the oldest minority orientated organization in the state. Its aim is to provide funding resources to this demographic as well as providing more opportunities on a social, political, and economic level. Founded in 1970, it is now over 50 years old, with its headquarters in Los Angeles. The Black Business Association (‘BBA’) is a non-profit organization.
- Disadvantaged Business Enterprise Program – This program has been designed to protect minority business owners against discrimination when procuring Federal transportation contracts. All business owners who are at a social disadvantage can gain assistance if they are involved in this industry (primarily transportation and construction).
- CATAPUALT – This is a joint effort from Capital One and the National Minority Supplier Development Council. It is essentially a 7-month long training program designed to empower and educate minority business owners. But it is orientated towards the resolution of complex problems or getting creative startups up and running. The National Minority Supplier Development Council (‘NMSDC’) is itself an avenue for Black business owners. It runs a non-profit consortium known as the Business Consortium Fund, which offers funding and consulting for minority business owners.
Black Business Grants
There are a huge number of grants available to Black business owners. For a more comprehensive list of grant options, check our list of business grants. It’s the most comprehensive and up to date article on active grants available to US business owners.
Billions of dollars worth of grant funding are given out each year. You have to find a balance between the time you spend applying against the probability of success. Some of the most prominent grant resources available to Black entrepreneur include:
- Minority Business Development Agency (‘MBDA’) – This is an arm of the US Department of Commerce. It connects minority business owners to funding and training resources. There are many business development centers dotted across the USA, supply a large number of grants and funding opportunities.
- Black Enterprise Elevator Pitch Competition – The ultimate prize is $10,000 for the winner of this contest. The 4 semi-finalists will pitch their idea to a panel of judges while the audience watches. The only real requirement is that the contests are Black and have an equity stake in the business.
- Miller Lite Tap the Future® Business Plan Competition – Grants up to $20,000 are available through the Miller Lite Tap the Future® Business Plan Competition. This was previously known as the MillerCoors Urban Entrepreneur Series. On top of the prize money, applicants will have the opportunity to pitch at the world-renowned Shark Tank, in front of well known entrepreneurial ‘sharks’. It also provides business exposure through the ‘Fan Favorite’ contest.
Aside from these 3 primary grant programs, there are many, many other places you can visit to apply for grants. Some of these options are outlined below. Remember that grant writing is by no means an easy or straightforward process. It takes time to write a good grant application, and you need to have a system in place.
For some business owners, grant writing is actually its own department, with a specialist designated to find appropriate grants and write excellent and specific applications on a yearly basis as the grant programs reopen each year. Other places to find grants include:
- Business USA
- Catalog of Federal Commercial Assistance
- State Business Incentives Database
- Small Business Innovation Research (‘SIBR’)
- Small Business Technology Transfer Programs (‘STTR’)
- Department of Agriculture (‘USDA’) Grants
- National Institute of Standards and Technology (‘NIST’) Grants
- Department of Education Grants
- Environmental Protection Agency Grants
7 Tips for Black Business Owners Right Now
Black business owners are in their own category right now and have significant potential for growth and expansion, provided they play their cards right. Just remember, that the current trend transcends the increase of financial compensation. It is about the empowerment of an entire demographic group from the richest to the poorest, regardless of where they live on the globe. With this in mind, the following are 7 business tips for Black owners.
#1 – Keep Growing
It might seem that the current situation is very untenable, unstable, and ill-suited to economic growth. But this is far from the truth. In fact, it’s no great secret that millionaires and billionaires make most of their growth in times of recession and turmoil. Focus on how to turn the situation to your advantage, not how to stay safe and watch your business falter and die. One of the most important business traits is adaptability.
There are so many financial and social initiatives in place for Black business owners right now, that you would do well to regard it as a perfect time for growth. Never before has a social demographic had so much social support. Capitalize on this and expand.
#2 – Work on Yourself
Many business owners (not just black business owners) can make the mistake of focusing more on the development of the business as opposed to the development of themselves. While there is a lot of overlap here, you have to develop along with the business. You won’t be able to run a business for the long-term if you are not passionate about it and have daily motivation to move forward.
Constantly reevaluate your strengths and weakness, and where you might need to get help. You should always be looking to expand mentally and emotionally by reading good books and getting the right exercise and nutrition. Ultimately, your business runs on you. Make sure the gas tank is full and don’t merely trade time for money. Otherwise, you will wear yourself out.
#3 – Get organized
Create a giant spreadsheet of current and existing financial resources. There are literally thousands of grants and loan options available. Keep applying, and tick them off one by one until you get the financing that you need. This might seem foolish if you do not currently have customers or support.
But your business model can adapt to bring in more customers. The main priority right now is to stay in business and not to despair because things have gone temporarily South. Every business owner comes up against a time of crisis at some stage or another.
How you respond is up to you. You don’t have to throw up your hands and give up, just because everybody else seems to be doing so. Get organized and focus on what you can do, whether it is writing a business plan, changing your business model, cutting costs, or expanding along a different channel.
#4 – Reach out to Family and Friends
There are many benefits to the current economic and social turmoil. Now is a better time than ever to connect with friends and family. It is also a perfect time to make new friends and social connections. And this includes white people, not the ‘Black v White’ battle that is subtly being played out on the media.
An effect of the Black Lives Matter movement will be a coming together of Black and White people, as well as people of different ethnicities and backgrounds. There is massive strength in having a community of like-minded individuals all working towards a common cause
#5 – Leverage Social Media
Never underestimate the power of word of mouth and social capital. Get active on social media and make your voice heard, whether you are a Black business owner or not. Start to launch initiatives to help other Black business owners and to tout them on social media. If you have any discounts for particular groups, make sure they are advertised on social media. Social media is a tool that cannot be ignored, regardless of your business model.
#6 – Become Anti-Fragile
The term ‘anti-fragile”- was initially coined by trader Nassim Taleb. Something that is anti-fragile gets stronger the more it gets injured. This is an excellent philosophy to have in terms of your business model. You should relish adversity. This is how all supreme athletes and business people look upon suffering and things not going to plan. They are not obstacles, but stepping stones on the path to success.
When Black Lives Matter and COVID have passed, you can be sure that more adversities will take their place. This is simply what happens in life, and you have to develop resilience and willpower to succeed in spite of adversity. Ultimately, it will make you a better business person.
#7 – Take More Risks
This is similar to the first point about continually expanding, but it goes even further. In today’s world and in the current political climate, you have to take risks, be creative, and be aggressive. The standard ways to try and get more customers will no longer work.
Customers look for innovative companies that have strong social goals. You need to provide them with incentives for visiting your business and constantly seek new means of optimization and expansion. According to Zim Ugochukwu of Travel Noire:
“With no risk, there’s no reward, and you either get comfortable with uncertainty and not knowing where you are going to end up, or you live this life that you don’t want to live.”
The Bottom Line
While the current situation seems very unfair and tragic, the death of George Floyd could serve as a catalyst for equality not just in terms of police injustice. Political, legal, financial, and other sectors of the US economy are being brought under scrutiny. Ultimately, it will lead to a fairer and more equal environment for all US citizens.
As a US citizen, you can support this movement in order to bring it to a better place and to assist a group that is clearly and obviously at a social disadvantage. And the outlook is not all grim, as sales are increasing and the economy is set to stabilize over the coming weeks and months.
Written by Sarah Davis
Sarah Davis is a business executive specializing in mergers and acquisitions, corporate finance, and international law. She achieved her MBA from Cornell University after completing a legal undergraduate at UC Berkley. Sarah runs her own business consultancy firm in tandem with working alongside the FinImpact team.