During the month of February, we celebrate Black History Month.
All of us are well aware of the significant contributions made to our society by the likes of Harriet Tubman, Frederick Douglass, Rosa Parks, and Martin Luther King, Jr., to name a few.
But are you also familiar with the names of Reginald Lewis, the richest African-American man in the 1800s; Charles Clinton Spaulding, president of North Carolina Mutual Life Insurance Company; Alonzo Herndon, founder of Atlanta Life and Atlanta's first Black millionaire; or Madam C.J. Walker, the first American woman to become a millionaire based on her hair care products formulated for African American hair?
At FranFund, we are especially inspired by their success and we celebrate the business achievements of these individuals and the other pioneering Black entrepreneurs that followed in their path. Black Americans have played a profound role in shaping our business landscape. A number of forward-thinking and universal business ideas like the traffic light, automatic elevator doors, and Caller ID have all sprung from the ingenious minds of Black entrepreneurs.
From the early 1900s, Black-owned companies were formed in direct response to racial discrimination. Specifically, segregation patterns created unfulfilled voids and market opportunities for Black entrepreneurs to step-in, earn money, and meet the budding demands of their community. With high job instability and limited employment opportunities, these entrepreneurs took matters into their own hands, building small businesses that served and employed Black Americans. Black business creation has fluctuated throughout the 20th and 21st centuries, but in recent years the number of Black-owned businesses has risen dramatically, with women fueling much of that growth. But, even with this forward momentum, Black American entrepreneurs still face a number of challenges--primarily, lack of access to capital. Even with all the acumen, creativity, knowledge, and manpower needed to succeed, without adequate funding, business ideas can come to a standstill, go unrealized or be taken by others with the capital to move forward.
Black Americans have successfully started and run companies from all industries. These minority-owned businesses are crucial to growing the American economy, adding $150 billion, according to the U.S. Small Business Administration's Office of Advocacy. As we shared in our Diversity, Equality, and Inclusion post, Black American entrepreneurs comprise one of the fastest-growing groups of business owners in the country. At FranFund, we're here to champion these aspiring business owners and provide equitable access to the resources needed to make their business ownership dreams a reality.
Although progress has been made, there is still much to be done. The current pandemic reminds us that we can do better. The National Bureau of Economic Research recently reported that 41% of Black-owned businesses—about 440,000 enterprises—have been shuttered due to Covid-19, compared with just 17% of white-owned businesses. At the height of the pandemic's first wave, Black unemployment topped 17%, and it is back on the rise now. It’s up to all of us to support local, small business, which provide employment to a staggering 59.9 million Americans, or nearly half of the U.S. private workforce, according to Small Business Trends.