How Black Women Entrepreneurs Overcome the Odds
Richard Moravek CLU
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A recent survey shows that Black women entrepreneurs find success despite lacking a leg up from capital.
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BY?SARAH LYNCH?, EDITORIAL FELLOW@SARAHDLYNCH
INC. February1, 2023
Black women represent the?fastest growing group of entrepreneurs?in?the U.S. though they face a unique?set of hurdles,?recent data shows they are succeeding despite the obstacles.
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A?survey?of more than 100 members of?the Black Owners & Women's (BOW) Collective revealed that 95 percent of these entrepreneurs used personal finances to start their companies and only 13 percent had?access to capital. These results reflect broader challenges for Black business owners, who are rejected for funding at?three times the rate?of white business owners, and female-only founders, who secured?just 2 percent?of VC funding in 2022.?
And yet, Black women entrepreneurs are making strides:?the BOW Collective survey reports that 41 percent of respondents have been in business for more than?a decade, and 75 percent of these women employ several people. Most respondents reported gross annual sales over?$250,000, and?more than?34 percent earned over $1 million.?
So how did these particular business owners?find success? Thirty-six percent leaned on client referrals, while 28 percent said they used networking to their advantage.?
"We have overperformed but been underinvested," says Nicole Cober, founder and CEO of the BOW Collective. "There's a great opportunity. What could we do if we had the proper investment of capital, as well as resources and relationships and additional support?"?
Although the pandemic?disproportionately affected?Black businesses, data from the University of California Santa Cruz found the number of Black business owners still grew approximately?30 percent?from April 2020 to December 2021. In 2021,?17 percent?of Black women were?starting or running new businesses, compared with?10 percent of white women and 15 percent of white men, according to the?Harvard Business Review.?
"As we approach Black History Month, we really want to reshape the narrative about Black entrepreneurs. We want to show how we are exceeding our expectations," Cober says.
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