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Black-owned businesses in the United States have obviously faced many historical obstacles through practices such as redlining and discriminatory lending practices; however, Black-owned businesses play an incredibly pivotal role in the current economy.
In fact, research from the Brookings Institute noted that investing in Black-owned businesses is key to expanding the overall economy. Although Black people comprise 14% of the nation’s population, Black-owned businesses represent only 2% of businesses. This underrepresentation is preventing the development of millions of jobs and billions in potential revenues.
Addressing these issues means addressing systemic barriers that prevent Black-owned businesses from coming to fruition. An inclusive economic model is essential for the future of the nation’s economy. It also means that it is a necessity to improve funding and support for Black-owned businesses while also promoting programs targeted at encouraging innovation, entrepreneurship, and professional development programs for persons of color.
Business experts have noted that the internet will be key to growing Black-owned businesses. Specifically, social media can help entrepreneurs better promote their businesses and access a greater customer base. Furthermore, local campaigns to encourage community buying from Black-owned businesses can help increase enthusiasm. Even companies like Google are increasing support as the search giant recently added a feature on its shopping tab that allows consumers to easily find Black-owned businesses.
However, one of the key aspects for the future of Black-owned businesses will be improving access to funding. In fact, there is an increasing number of grants available for Black-owned businesses, an important trend as members of the Black community are denied loans at a disproportionate rate. Meanwhile, grant funding carries the additional benefit of not creating debt. Here are three programs that Black entrepreneurs can take advantage of.
Minority Business Development Agency
The MBDA is committed to helping minority business owners throughout the United States through a number of programs including grant funding. In addition to this, local MBDA centers provide free business consulting, procurement matching, and other types of assistance.
National Minority Supplier Development Council
This organization has a mission of increasing business opportunities for minority-owned businesses. It oversees the Business Consortium Fund, a nonprofit business development program that provides grants and other types of financing. It also provides business advisory services free of charge.
Small Business Administration 8(a) Business Development Program
This program aims to assist business owners who fall into either the socially or economically disadvantaged categories. To qualify, a majority of the business must be owned by someone who has faced bias or prejudice due to their race or ethnicity. While the program does not give traditional grants, it assists businesses in obtaining contracts set aside specifically for them and also provides access to advise, training, executive development, and a mentorship program.