In 2015, Fortune revealed that Black female entrepreneurs were on the rise. At the time, the number of businesses owned by African American women grew 322% since 1997, making Black women the fastest-growing group of entrepreneurs in the U.S.
The statistics in the findings were inspiring. Women-owned 30% of all businesses in the U.S. that by that year, with African American women controlling 14% of the companies, or an estimated 1.3 million businesses.
Flash forward five years later, and Black women are still killing it in the world of entrepreneurship. Currently, the U.S. has an estimated 2.5 million Black-owned businesses, with Black women taking up much of the space according to Forbes Magazine’s June 2020 report. These businesses are mostly owned by Black women aged 35 to 54.
Black female founders are thriving in several areas: the beauty and hair care business, real estate, financial services, event planning, and fashion are at the top of the list.
The transition to owning our own businesses shouldn’t be surprising. For centuries, Black women have been overworked and underpaid in corporate America. Moreso, our ideas have been overlooked or stolen. At a certain point, we opted to use our talents and start our own.
The risks appeared to be bigger than the reward as we worked tirelessly pouring our energy into helping other companies flourish. With the same energy and resources, doing the same for ourselves and being our own bosses was more appealing. To sum it up, Black women typically start their own businesses out of frustration from the daily obstacles they face at work.
The added benefits of creating generational wealth within our own communities and being able to give our communities quality jobs make it all the more worth it.
There are several reasons why Black girls rock in business and are thriving by owning their own. For starters, we have the formal education and networking experience to jumpstart whatever business we want.
Despite the potential success of Black women owning their own businesses, it’s not an easy road. As Dell Gines, Dell Gines, the author of the Federal Reserve Bank of Kansas City, Black Women Business StartUps report notes, “An entrepreneur is someone who will jump off a cliff and assemble an aeroplane on the way down but for Black women entrepreneurs, they do it with only a toothpick and a napkin.”
Gines further explains: The businesses tend to stay very small, and you don’t see a lot of scalabilities.”
But, having a small business can be manageable, and profitable. Staying up to date with market trends, charging competitive rates for services, and being able to adjust and remain innovative are key factors in a Black woman’s business surviving.
Gines explains it’s also critical for Black women to think outside of the box when starting their own businesses. There’s more than just beauty services they can offer. There’s an expansive market that Black women can tap into.
“You are going to see a rise in black women doing business in professional services with the rapid increase in education levels for black women and their increased participation in the labor market, in fields such as accounting and engineering,” he told Forbes in 2018.
The coronavirus pandemic proved to hit Black-owned businesses the hardest; however, many are surviving by adjusting to the times through utilizing online promotional efforts and partnering with liked businesses owned by other Black women to share resources.
The pandemic also proved to be a time where entrepreneurship, particularly among the Black community, continued to rise as many lost their jobs and had to find other means to make income. Being married to the home during quarantine was the push many needed to finally take the next step in starting their own businesses.