Black entrepreneurs still face barriers to opening businesses | Colorado News
By MEGAN ULU-LANI BOYANTON, The Denver Post
DENVER (AP) — When Courtney Samuel, who was born and raised in Denver, recalls teenage memories with her father, he thinks of construction.
While young Samuel cleared the sites, his father managed the construction work. Elder Samuel’s company eventually helped build the Blair-Caldwell African-American Research Library – the public library in Five Points, one of the capital’s historically black neighborhoods.
Little did Samuel know then that a few blocks away he would one day open his own business: Bodies By Perseverance, a gym offering personal training, boxing and more, which celebrated its 18th anniversary in November.
“Every entrepreneur needs to have persistence, and that’s what I named my business,” said Samuel, who is now his father’s caretaker.
After his football career and a stint as a network engineer, Samuel made the decision in his early twenties to set up a gym. However, the loan conditions were stricter than he imagined and he was turned down by the bank. Instead, Samuel borrowed against his 401(k) plan to launch his business.
He noted that while “any small business owner will struggle to get loans,” entrepreneurs of color may face an additional hurdle. They are often unfamiliar with the loan programs available because they are not “invited into many of these rooms” where relevant discussions are taking place, Samuel said.
A recent study by LendingTree ranks Denver as one of the 10 US metropolitan areas with the lowest percentage of black-owned businesses, which “doesn’t shock” Samuel. The Mile High City is No. 6 out of these last 10, tied with Boston. Of nearly 70,000 Denver-area businesses, only 999, or 1.4 percent, are black-owned, the report determined after analyzing data from the U.S. Census Bureau. About 6% of the Denver metro area population identifies as black, he adds.
Pittsburgh, Pennsylvania was identified as the metro area with the lowest percentage of Black-owned businesses at 1%, while Fayetteville, North Carolina topped the list at 11.2%.
The 10 areas with the highest percentages of Black-owned businesses were mostly concentrated in the South, with larger Black populations ranging from 48% in Memphis, Tennessee, to 18% in St. Louis, Missouri. Alternatively, the 10 areas with the fewest black-owned businesses claimed smaller black populations that made up less than 10% of the general population, with the exception of Milwaukee, Wisconsin at 16%.
Black individuals make up nearly 13% of the US population, but only 2.4% of US businesses are run by black owners, according to the study. Matt Schulz, chief credit analyst at LendingTree, described it as “obviously a big gap.”
In terms of Denver’s performance, its “black population is smaller than many other cities we’ve looked at,” compared to the metro area’s overall population, Schulz said in a phone interview. Because of this, “there is actually less of a disparity between Denver’s black population and the percentage of black-owned businesses.”
Yet business owners, like Jesse Brown and Harsha Maragh of Denver’s Wah Gwaan Brewing Company, continue to face obstacles, including access to financing.
“I’m very disappointed with the access to capital here in the city, especially a city that has great diversity,” said Brown, a Denver native and US Marine.
“Getting funding for our brewery was a huge hurdle, and it still is,” said Maragh, a first-generation Jamaican-American. The name of the brewery, “wah gwaan”, means “what’s up” in Jamaican patois. Maragh aims to share her culture and “bring a little more diversity to the industry” through their business, she said in a phone interview.
Brewery owners are typically white males, with the Brewers Association reporting that nearly 94% of owners identify as white and about 76% as male, according to a 2021 survey of 500 random breweries.
“There needs to be more support, more investment and more love for Black-owned breweries and Black-owned businesses in general, even when it’s not February,” which is the Month of black history, Maragh said.
But access to capital isn’t just an issue for black entrepreneurs, said Lee Gash-Maxey, executive director of the Colorado Black Chamber of Commerce.
“Black, brown, Asian businesses – everyone needs more capital to run their business,” she said in a phone interview. “Any programs that help raise capital for small black businesses, we should take a look at.”
She highlighted two initiatives that CBCC is leading to provide more opportunities for black entrepreneurs. The first partnership with Colorado Enterprise Fund, a nonprofit lending institution, created a specific black business loan fund, which is targeted at black-owned small businesses, Gash-Maxey said. The second partnership is with Daniels College of Business at the University of Denver which resulted in the “Building Success” program, a six-session training program that helps participants learn about business models, marketing, financial management and more.
The Colorado Black Chamber of Commerce also gained “more members than it has had in the last five years” in 2021, she added.
Lorena Zimmer, who oversees special initiatives at the Metro Denver Chamber of Commerce, called starting and growing small businesses for Black and Latino residents “one of our top priorities” at Prosper CO. Launched in 2019, the joint initiative between the chamber, Metro Denver Economic Development Corporation and the Denver Metro Chamber Leadership Foundation works to identify and address economic barriers, especially for women and people of color.
Community and non-profit organizations have informed Prosper CO that the areas most in need of improvement are access to financial capital, markets, and social capital, which consists of community networks and relationships that lead to potential buyers and mentors, Zimmer said. She mentioned a project being developed to address these needs: an online marketplace for Black, Indigenous and People of Color-owned businesses to list their information, which will help large companies buy from them more easily. of them.
“We’re well on our way to building a really strong support ecosystem for our black entrepreneurs,” Zimmer said. “It’s a community that wants to be more inclusive and more diverse by building more equitable systems.”
When it comes to access to capital, “there is money available,” said China Califf, director of the Denver Metro Small Business Development Center, but acknowledged that “navigating through what’s available to you and then applying for the good stuff and having everything you need to do it is the barrier in a lot of cases.
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