Supporting Black Businesses: Myth versus Reality
Starting a business is a monumental undertaking for anyone. But when you start a business and you’re black, you face unique challenges that people of other races will never have to face. Let’s look at some of the challenges facing black businesses and why you should support black businesses whenever you get the opportunity.
Funding Black-owned Businesses
One of the most fundamental issues facing black startups is a lack of funding. The vast majority of funding in the U.S. goes to white startups for reasons unknown to most. Whatever the reason, black startups are usually self-funded either through personal savings or by using money from a 401K.
According to blackenterprise.com, a measly 0.2% of all venture capital funding was allocated toward black woman-owned startups.
Due to how lots of black businesses are started, it can be very difficult to expand, and every dollar counts.
Facing Discrimination In Business
As much as people want to believe that discrimination against blacks is not an issue, the reality is that discrimination based on race is alive and well.
Studies show that bankers are twice as likely to lend to white people than Black people. A study led by researchers at National Community Reinvestment Coalition, Utah State University, Brigham Young University, Rutgers University, and Lubin Research uncovered the previous fact. This puts black business owners at a serious disadvantage when compared to business owners of other races.
Aside from this type of discrimination, black people face discrimination from the general public, including many potential customers. Many people make a conscious effort not to support a business if it’s black-owned. This puts an enormous strain on future business growth, and it’s a significant disadvantage.
Not all is lost, though, you can help to support black-owned businesses if you make a conscious effort to do so.
Reasons to Support Black-Owned Businesses
One should support black businesses for a myriad of reasons. We will go over some of those reasons in this section.
There is a clear racial wealth gap that exists in America, and it favors the whites, of course. Luckily, this issue is one that you have some direct power over. Supporting black businesses by funding black ideas and consuming black products helps to close the racial wealth gap.
Supporting small businesses, especially those owned by black owners, helps to strengthen local communities by creating new jobs.
Also, supporting black-owned businesses helps to spread the black culture and showcase your pride in your black roots. Also, in your support of black businesses, you reduce your consumption of non-black products, which helps to level the playing field when it comes to racial economic disparity.
Support Your Own
Hopefully, this article has given you some insight into how it is to run a black business in America and has encouraged you to make a conscious effort to support black businesses in the future.
Every black supporter counts, so think about who you are supporting regularly and consider seeking out black businesses to support instead. It will make more of a difference than you can imagine.