Black women in America share a unique experience as business owners, facing challenges rooted in both systemic sexism and racism, and often lacking financing options.
To better understand the challenges Black women entrepreneurs face in getting their businesses off the ground, we spoke to five successful business owners to learn how they overcame challenges. She shared her thoughts and offered advice to other Black women entrepreneurs.
Business Tips for Black Women Entrepreneurs
Black women entrepreneurs face unique challenges when starting a business due to funding hurdles and other issues. For example, Black entrepreneurs, on average, completed more applications for financial entrepreneurship assistance than any other group, according to a 2021 report released by Federal Reserve Banks in several cities. However, Black entrepreneurs were half as likely as white entrepreneurs to receive full approval for small business loans and other sources of business financing.
Learning from other successful business owners is one of the best ways to overcome challenges and reach your full potential as a budding entrepreneur. Whether you already own a business or want inspiration to get started, here's advice from Black women entrepreneurs.
1. Save money before contacting investors.
Before embarking on an entrepreneurial journey starting a scented candle company with her husband Dariel, Tiffany Griffin had a career in academia and policy development. With the aim of spreading her knowledge and bringing about positive change, she was motivated to bring awareness to the Black experience. Now, her company is doing the same by incorporating scents inspired by the African diaspora and naming candles after Black pioneers.
As a “social entrepreneur,” Griffin said she always wanted her products to evoke both memories and conversations about Black culture. Her mission in her business has always been to serve others on a cultural and community level while discussing Black culture, but she says that's a barrier when pitching to business investors. I did. She found that her funding was often conditional on undermining the core values of her race-based product line. Griffin and her husband found this problematic.
Griffin and her husband were in a financial position to fire these investors, but acknowledged that many companies may have to compromise their core beliefs to stay in business. . To avoid finding yourself in such a position, Griffin suggested saving up some capital to take care of start-up and operating costs before launching your business.
“Financial security comes with freedom,” she says. “We also learned to plan and plan and plan some more and stick to our values. I try to do my job seriously.”
lesson: Griffin advised up-and-coming black businessmen to save money before launching a business to avoid relying on investors who may require fundamental changes to the business.
Raising capital is a challenge that all women entrepreneurs face. Experts advise women entrepreneurs to ask for more funding than they need to avoid receiving a lower level of funding than requested.
2. Charge what you're worth.
After working for several years in corporate America, Janna M. Joyner decided she wanted to start a creative marketing agency. After being ignored for her raise and told that her company doesn't have the budget for a raise, she steps away from her office politics and starts her own business, her Leap Innovative Group. Became. She said Joyner found it difficult to set her own rates because although she was familiar with the industry, she had a hard time advocating for herself.
Joyner kept his interest rates low for a long time, but eventually realized that African Americans have a different cultural relationship with money than white business owners, creating a divided understanding of value. Noticed.
“Our white people are used to having capital, they are used to raising their own prices, and they feel confident in defending their prices, even if they are higher than the market rate. ,” Joyner explained. “I realized that if they have the confidence to stick to their prices, why can't I? I have confidence in my expertise…so I'm confident that I'm getting value for the price I set. You should also have confidence that you have it.”
To overcome this fear, Joyner welcomed the advice of white leaders whose understanding and confidence in money led her to raise interest rates. She realized that she was indeed worth paying, and she found comfort in researching average market rates. To that end, she asked black women business owners not to take her rejection personally. When a customer says “no” to your rate, it reflects what they are willing to pay, not what you offer, she said.
“My clientele now consists of companies that understand the value I bring and are willing to pay me what I'm worth,” Joyner said.
lesson: Joyner encouraged Black women entrepreneurs to avoid underpricing their services by researching the market and knowing the value of their services.
Low prices can scare away customers. Customers often believe that they are getting what they pay for and consider low prices to be cheap and good value.
3. Sell your product early.
When Houston native Brittney Winters graduated from Stanford University in 2008 and earned her MBA from Harvard University in 2016, she knew she was on her way to bigger and better things and a life of corporate success. I believed there was.
But after several years of successfully working in investment banking and the fossil fuel industry, she realized that she would “never bring my true self to work.” Realizing her lack of ownership over her own career path, she took her entrepreneurial path and founded her own hair extension and wig company, Upgrade Her Boutique.
Now a full-time entrepreneur, Winters said the biggest challenge she faced was raising money for the business. While many entrepreneurs and small business owners have access to initial funding from friends and family, that option isn't always available to Black entrepreneurs. According to data from the Federal Reserve Bank of Boston, white families have, on average, more than four times as much wealth as black families.
Winters said she has received help with financing, but she also addressed funding issues by selling her product in the early stages of her business. After launching her pop-up store and selling out of her inventory in three hours, she gained some funding and an early customer base. Although it wasn't at the level she imagined, Winters said it was the spark she needed to keep moving forward.
“I think we all want to perfect our ideas before we bring them to market, but we've learned that you have to work with what you have,” she said. Ta. “Funding can be difficult to access sometimes, so think about what is the most basic prototype of what you can present…get your foot in the door. We can work towards building it.”
lesson: Mr. Winters advises business owners to maximize their capital by starting small and selling products in the early stages of their business, expanding their customer base and generating more capital that can be reinvested back into the business. encouraged them to acquire.
4. Network and get clients and mentors.
The world of celebrity and sports public relations and communications has long been dominated by white men, but Latonya Storey has built a successful career in the industry. She owns her LPS Consulting PR, a professional public relations and marketing firm representing today's brightest talent. Story has worked with famous athletes such as Michael Vick and Dwight Howard, and she has received several industry awards including the Women in PR Trailblazers Award.
Although he is now known as a successful businessman, Story says he initially had to work harder than white men to prove himself. When she started working in PR 20 years ago, Marvette Britt, founder of the Britt Agency, was the only black woman in her field. To overcome that hurdle, Storey used her networking ability to sign her first client. Through her “word of mouth, social media, and traditional pitching,” she was able to bridge the gap between herself and other established PR professionals.
Storey said most black women entrepreneurs are assertive and persistent and are “not afraid to reach out to people” to seek out new clients and potential mentors.
“My first chance was when I heard a radio ad for the Allen Iverson Celebrity Summer Classic and called,” she said. “I volunteered for her in the public relations department for two summers, which allowed me to network and meet professional athletes. One of them gave me a chance and… He became my first paying client.”
lesson: Storey emphasized the importance of networking when searching for new clients and potential mentors. She advised budding black women entrepreneurs to not be afraid to take chances and reach out to people they want to work with.
A good PR firm can help businesses overcome and deal with PR crises such as negative customer reviews, management scandals, and data breaches.
5. Conduct market research.
As a Black American woman, becoming an event planner in Dubai was already an unconventional career choice for Genela Moore. But after Moore spent years coordinating large-scale celebrity social events in the “golden city,” she found further success in a new business, auto parts, usually run by white men. .
As the founder of Motorparts Nation, Moore distributes auto parts to mechanics in Ghana. Moore said he became involved in auto parts after becoming interested in international trade while in the Middle East, conducting market analysis and discovering where auto parts were most needed. Much of her professional life took her to areas of the world where black women were less common than other ethnicities, but she ultimately relied on her own race as a “superpower.” she said she did.
“Even living in the Middle East, being a black woman had many advantages,” Moore said. “I feel like I'm reliable, I'm honest, and I follow a plan to do exactly what I say I can do. That's my advantage.”
Moore realized that as a Black woman, she could make a difference in the communities that needed it most. For Moore, that group is the people of Ghana, and more specifically the country's auto mechanics.
“Black women reinvest in their communities. Rather than just focusing on the home, we focus on how we can collectively act to empower and connect with others. focus,” she explained. “It may sound like my company is just an auto parts company, but if you look at the top 10 health-related epidemic deaths in Africa, road injuries are second only to malaria, AIDS, and stroke. …I companies are trying to change that by working to train mechanics on how to make our roads safer.”
lesson: Moore recommended finding business opportunities by conducting market research and identifying communities in need of support.
Apart from conducting market research, business owners can use business research to generate potential customers and assess brand awareness and customer satisfaction.
