Black Business Community – Overcoming Challenges to Flourish
It’s important to acknowledge and recognize our Black business communities across the nation! Let’s celebrate the progress made and the strides to overcome challenges. According to a recent Pew Research Center analysis, Black businesses are on the rise – and achieving strong economic growth. The center reported that in 2021, there were 161,031 Black-owned businesses in the U.S., up from 124,004 in 2017. During this time, Black business owners revenue grew from nearly $127.9 billion to $183.3 billion, a 43 percent increase. While much has been accomplished, significant growth is still needed. In 2021, only about 3% of (identified) U.S. firms were shown to have Black-business ownership, accounting for just 1% of the country’s gross revenue.
GrantWatch is celebrating National Black Business Month by making resources available to help Black business communities continue to thrive and prosper. In addition to providing the list below regarding Black business support, GrantWatch also offers a list of over 2,000 grants in its BIPOC grants list category.
Overview of the Role of Black Business Ownership in the U.S. Economy
- Historian John William Templeton and engineer Frederick E. Jordan Sr founded National Black Business as an annual observance in 2004 to “drive the policy agenda affecting the 2.6 million African American businesses.”
- Black business owners account for about 10% of U.S. businesses and about 30% of all minority-owned businesses. According to the U.S. Census Bureau, that amounts to approximately two million companies owned by African Americans.
- Nearly 40% of Black-owned businesses are in health care and social assistance, repair and maintenance, and personal and laundry services. Other categories include advertising firms, auto dealerships, consulting services, restaurants, barbershops, beauty salons, and more. (nationaldaycalendar.com, “Black Business Month“)
Facts Regarding Black-owned Businesses
- In 2020, Black people represented 14.2% of all Americans but only 2.4% of all employer-firm owners, while Asian Americans represented 6% of the population and 10.6% of employer-firm owners.
- From 2019 to 2020, Black-owned businesses grew by 6,351 firms, or 4.72% – behind Latino or Hispanic (8.19%) and Asian American (5.33%) firms, but ahead of white-owned businesses, which shrunk by 0.9%.
- From 2017 to 2020, the number of Black-owned businesses nationwide increased by 13.64%- compared to 0.53% growth for all businesses over that same period. Black-owned firms generated an estimated $14.1 billion in gross revenue in 2020, growing 11% since 2017.
- Moreso than other racial groups, Black-owned businesses had pronounced increases in revenue, employees, and payroll. In 2020, Black business owners employed 1.321 million, adding 48,549 new jobs and an additional $1.7 billion in payroll to the U.S. economy.
- If Black business ownership continues to grow at its current rate (4.72%), it will take 256 years to reach parity with the share of Black people in America – a timeline that leaves racial wealth gaps entrenched. Reaching parity in 15 years would take a 74.4% growth rate; for 25 years, a 44.6% growth rate; and for 50 years, a 22.3% growth rate. (brookings.edu, “Who is driving Black business Growth? Insights from the latest data on Black-owned businesses“)
Why is Black Business Growth So Important?
Black business growth is crucial for several reasons:
- Economic Impact. Black-owned businesses contribute significantly to the economy by creating jobs and generating revenue. In 2020, Black-owned firms employed over 1.3 million people and generated $141.1 billion in gross revenue.
- Community Development. These businesses often reinvest in their communities, helping to improve local infrastructure, education, and services. This reinvestment can lead to more vibrant and sustainable communities.
- Reducing Wealth Gaps. Increasing the number of successful Black-owned businesses can help reduce the racial wealth gap. By providing opportunities for wealth creation and economic mobility, these businesses can help address long-standing economic disparities.
- Innovation and Diversity. Black entrepreneurs bring unique perspectives and innovations to the market, which can lead to new products, services, and business models. This diversity can drive overall growth and competitiveness.
- Social Equity. Supporting Black businesses helps [to] counteract the historical and systemic barriers that have limited economic opportunities for Black communities. It promotes a more inclusive and equitable economy.
Overall, growth of Black-owned businesses is not just beneficial for the Black community, but also for the broader economy and society. When these businesses thrive, everyone benefits. (bing.com, “Why is Black business growth so important?“)
Below is a current list of grants and other funding to benefit Black Business growth and development.
Black Business Grants
- Grants of up to $15,000 to eligible community-based organizations to benefit the Black community. Funding is to promote economic stability, job training, and financial literacy among historically underserved African American populations and more recent African immigrants and refugees. Moreover, the goal of the program is to address the most pressing needs of local Black communities.
- There are grants to nonprofits, Institutions of Higher Education (IHEs), and for-profit organizations for diverse researcher-led health and mental health-related research projects. Required registrations will take up to several weeks to complete. Additionally, research projects must fall into one of the research areas of interest, including aging, addiction sciences and understanding and/or treatment of mental health disorders. Historically Black Colleges and Universities (HBCU) will be given priority consideration.
- In addition, grants to public and private local news organizations, including TV and radio stations, newspapers, digital sites, and media centers, to cover early-career journalist salaries to join the staff. Funding supports local organizations committed to providing objective, civically important local journalism. Priority consideration will be for Black-owned newsrooms.
- Grants to eligible Black-led nonprofits serving Black populations for programs and projects to promote economic development, improve health outcomes, encourage social justice, and preserve Black culture and history. As a result, funding is for general operating assistance and/or to support specific programs.
- There are grants to nonprofits, tribes, IHEs, and special districts for workforce development. Required registrations will take several weeks to complete. The program goal is to provide employment training to Americans resulting in good jobs. In fact, the Funder is committed to equitable economic development, and to prioritizing sectoral partnerships to reach historically underserved populations and areas, including communities of color.
Additional Black Business Grants, along with an Opportunity and Scholarship Support
- Also, grants to BIPOC artists (Black, Indigenous, People of Color) for career development activities. Funding is for artists from historically underserved and marginalized populations. Artists will be at any stage of their arts career.
- In addition, grants of up to $50,000 to Black-led organizations for programs to create social change. Funding is for initiatives led by and for the benefit of Black women. The program is for projects to strengthen the Black feminist movement. Moreover, funding is currently provided to Black feminist groups in the Americas (Latin America, the Caribbean, and North America), and in the Middle East, Europe, and Africa.
- Opportunity for startup businesses to participate in a business-accelerator-program. This opportunity is for companies founded by Black entrepreneurs. Companies from all stages of development will apply. Accepted startups receive 12 weeks of mentorship as well as additional perks from a wide range of vendors. This is a hybrid program. Most in-person events will take place in Milwaukee, Wisconsin.
- There are grants of up to $25,000 to eligible Black-owned companies to improve business outcomes. Funding is to promote job retention, enhance business success, and advance job creation for small businesses. Grants will be for special projects and general operating expenses, such as salary, wages, lease, rent payments, working capital, and other capital expenditures.
- Lastly, grants and scholarships to eligible for-profit companies led by founders from diverse backgrounds to promote business development. Altogether, funding is for growth capital to hire or rehire employees, and to acquire, repair, or enhance equipment to help manage growth challenges and scale for the future. The list of self-identifiers for Founders includes those who self-identify as Black.
The Bottom Line
To conclude, this has hopefully provided some strong options for funding that will directly assist business development in the Black community!
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