August 20, 2024
According to The Economist, while campaigns emphasizing the support of Black businesses are important, the more vital contributions come from recieving equitable access to capital, education, and connections.
In June 2020, The Economist discussed ways Black businesses needed investment beyond placing the onus on consumers to support Black businesses through “buy Black” campaigns.
According to the outlet, while such campaigns are important to the success of Black-owned businesses, the more vital contributions come from receiving equitable access to capital, education, and connections.
Recently, INC laid out its own suggestions for ways to help support Black-owned businesses, and unsurprisingly, the advice remains much the same as it was in 2020. This is a sign that despite some policy and funding access improvements, there has not been much change on an institutional level since The Economist’s report.
As Shaundell Newsome, the founder of Sumnu Marketing, argued in an op-ed for Fortune, although there has been some assistance provided through the Bipartisan Infrastructure Act, mentorship in the Black economic community can also boost these businesses.
Newsome also called for larger corporations to support these businesses by creating or participating in programs that give financial assistance or resources that meet the specific needs of African-American-owned businesses.
Black-owned and operated businesses have been experiencing something of a renaissance, according to Isabel Casillas Guzman, the head of the U.S. Small Business Administration, who stated in a January press release, “America’s great diversity continues to propel entrepreneurship with Black, Latino, and women founders starting up at higher rates than ever. As we enter 2024, the SBA will continue its work to increase access to the resources needed to start and grow resilient new businesses, harnessing the unique optimism and ingenuity of American entrepreneurs.”
The same press release pointed out that Black business ownership was at its highest level in 30 years, a small business boom precipitated by $52 billion in funding from the SBA, of which over 32% was allocated to these small businesses.
Despite this, African-American business owners face a persistent dearth of capital, often at the hands of the banking industry, according to Larry Ivory, the president and CEO of the Illinois State Black Chamber of Commerce.
“One of the biggest and greatest challenges that African American business owners face is not getting access to the capital they need. Cisco data points out the fact that Black people get turned down at a much higher rate than Caucasians, even with the same credit scores and same factors being considered.” Ivory said.
RELATED CONTENT: Peep This List Of Financial Resources For Black Business Owners And Entrepreneurs
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