African Americans have made significant contributions to the business landscape globally. Unfortunately, the road to success for black entrepreneurs has several obstacles. While the number of black-owned businesses has increased, black entrepreneurs should contend with very tough barriers. For instance, even though funding is a standard challenge for small businesses, it is especially more challenging for young black entrepreneurs.
That said, below are a few ways black entrepreneurs can overcome adversity in the business realm:
- Understand that money isn’t the only form of capital
Most female black-owned businesses raise an average of $30,000 as starting capital. While this might seem a lot, successful startups in America require up to $5 million as starting capital. You might need more if you intend to run a charitable organization or plan on giving back to the community. Unfortunately, most black entrepreneurs don’t have access to generational wealth or investors who can offer millions for their businesses.
As such, young black entrepreneurs should look beyond money when looking for capital. They should be resourceful and find creative ways of kickstarting their businesses. While raising money is crucial, investing in themselves and those around them is important. Young black entrepreneurs should also focus on acquiring new skills, such as web design and marketing basics, to save on normal startup expenses.
Cash-strapped small businesses can benefit immensely from connecting with the local community. Placing the business in front of potential customers, primarily through community engagements, is important. Meeting new people, online and offline, connects startups with employees, customers, and potential investors.
- Be patient
Businesses don’t succeed overnight. Therefore, young black entrepreneurs should accept to ‘fail forward’ to be successful. Running a business is like watering seedlings. While initial efforts might seem fruitless, progress isn’t noticeable until the seeds sprout. According to the BLS, 20% of small businesses fail in their first year, and 50% fold up by the fifth year. Only a third of small businesses survive up to 10 years.
That said, black entrepreneurs should remain patient and brace the hard times. Even if customers don’t buy now, tough economic times don’t last. They will be back in the future. Entrepreneurs should keep in touch with leads and former customers through email marketing and other promotional means.
The Bottom Line
Young black entrepreneurs should brace business barriers and market challenges to succeed. Fortunately, unlike before, support for black businesses has increased, with organizations like NAAIA Foundation offering a helping hand to young entrepreneurs.