It isn’t every day that we hear about success stories of Black women business owners, although they have been making significant progress over the years. From 2007 to 2018, women-led businesses grew by 58%, and Black women-owned firms increased by 164%. If we sharpen the focus to the five years between 2014-2019, women-owned businesses grew by 21% and Black women-owned companies by 50%. In 2018, there were a total of 2.4 million African American women-owned businesses. Now, that is Black Woman power!
Like all businesses, there were undoubtedly many struggles and setbacks on this journey to success.
One of these obstacles was that Black female entrepreneurs’ revenues were 20% less than the average revenue for all female entrepreneurs. A study showed that Black women-owned businesses earned an average of $24,000 while all women-owned companies earned $142,900. That’s nearly a 600% difference in revenue!
Some other difficulties that only Black women face include not receiving requested financing, not possessing the social connections other entrepreneurs have, and not having enough people to help scale up their businesses. Yet, despite these roadblocks, black women continue demonstrating their resilience and hard work over the years.
It was a long road, but we made great strides, which wasn’t the result of one day’s work but rather years of blood, sweat, and tears. The catastrophe that happened overnight was the uneventful encounter with Mr. Covid-19. He brought along all the bad boy troubles one can imagine. He cheated Black women’s businesses, played with their money, and left them heartbroken.
Following the month of doom, March 2020, Black women’s businesses were threatened to be wiped out, fueling pre-existing issues.
The pandemic severely hindered the financial capital of Black female entrepreneurs. During this time, 58% reported that their business’s financial health was “at risk” or “distressed,” while only 27% of white business owners experienced this stress level. Most Black women-led businesses have a few weeks to months of cash flow. Moreover, a lack of access to new funding has left them in perpetual uncertainty, waiting for the relief they fear will never come.
Many Black-owned businesses are in industries that the pandemic severely impacted. These include leisure, hospitality, transportation, retail, childcare, hair salons, catering, and restaurants. As a result, 40% of Black-owned businesses experienced extended closures and faced strict and costly re-opening guidelines.
The lifesaving $670 billion PPP loans meant to help businesses did not trickle down to many Black companies due to structural limitations, such as stipulations around headcounts and revenue requirements.
Due to such disadvantages, the time has come to buck the statistics and the current situation.
The effects of the pandemic are still ever-present. As of December 2022, we are staring into the face of a potential recession, which indicates that the inclement business weather is not letting up.
Now is the right moment to put the world on notice – there has never been a more crucial time to expand investments in Black women. With an eye on the nation’s recovery, Black women entrepreneurs will be one of the most significant parts of the economy.
Despite the hurdles thrown at Black women, they will not back down. They will stand firm in the face of adversity.
When the devil whispers in your entrepreneurial ear to tell you, you will not withstand the storm, you answer back – I AM THE STORM.