According to the 2018 Report on the State of Women Owned Businesses, Black women-owned businesses experienced the highest growth rate (164%) of all women-owned businesses from 2017 to 2018. An appealing alternative to the formal labor market, entrepreneurship provides Black women the opportunity to escape hostile working environments, but conditions as business owners are not always drastically better. The average annual revenue for Black women-owned businesses sits at just $24,700 compared to $143,100 for all women-owned businesses. While start-up numbers provide a glimmer of hope for Black women’s economic stability in the future, we must look beyond these statistics and ask more critical questions about the processes at work. Do these start-up rates tell the complete story? What challenges do Black women face operating their businesses? Why might these businesses be less profitable than businesses owned by other owners?
My article with Dr. Paromita Sanyal in the Journal of Business Anthropology’s special issue on entrepreneurship, “Struggles and Strategies of Black Women Business Owners in the U.S” addresses these key questions regarding Black women’s experiences with business ownership. We examined the experiences of Black women business owners to better understand the struggles they face operating their businesses, as well as how they navigate certain obstacles. Through 20 in-depth interviews, we aimed to take a step beyond analyzing start-up statistics and ask Black women about their everyday experiences as business owners. Our respondents owned businesses in a variety of fields such as information technology, real-estate, sports consulting, fitness, and retail.
We found respondents experienced two main struggles: overcoming stereotypes and interacting with their Black clientele. In their interviews, Black women expressed grappling with stereotypes that labeled them angry, unprofessional, and intimidating. Black women business owners faced these stereotypes from other owners, as well as clients, and they noted these labels negatively impacted their businesses and professional relationships. As a result, additional work is required of Black women business owners to combat these stereotypes, so they can maintain their businesses and build rapport with their clientele. Black women in our study cited adopting standards of excellence and managing the way they presented themselves as business owners by monitoring their dress and speech to combat stereotypes.
Most of the Black women we interviewed provided services to Black customers. Surprisingly, this shared racial identity complicated Black women’s ability to maintain professional boundaries and generate consistent revenue. Respondents in our study noted they often provided services to people they had close personal relationships with. We found that Black clientele often asked Black women business owners for favors like late, or discounted payments, for services or preferential treatment. This level of comfort complicates Black women’s ability to grow their businesses, while forcing them to create clear professional boundaries with their clients. Much like monitoring their presentation of self and adopting high standards of excellence, maintaining their client relationships requires additional labor that goes beyond managing inventory, marketing, and sales.
Although the start-up numbers appear to be promising for Black women-owned businesses, our research shows a more complicated story. Black women often start businesses in less lucrative industries such as retail, technical services, or food, but our research shows they also face obstacles related to their racial and gender identities. They continue to persevere by adopting navigation strategies to maintain their businesses, but we must question how these specific challenges, and the additional work Black women must perform to overcome them, potentially interfere with their business viability and ultimate success. Spending more time worried about the way they speak, their demeanor, or if their clients will ask to pay them next week, adds additional stress and hurdles to success for Black women.
Our study comes at a time where young people are trying to launch the next greatest venture, and we see younger entrepreneurs attempting to make their mark early. To prepare students for their entrepreneurial endeavors, elevator speeches, start-up competitions, and internships are integrated into college classrooms. Close to home, Florida State’s Jim Moran School of Entrepreneurship transitioned into its own college in 2019, becoming the first stand- alone college devoted to entrepreneurship in the country. The college is designed to stimulate innovation, provide hands on experience with technology, and prepare students to access start-up capital. Our recent research will assist with cultivating future Black women business owners by shedding light on some of the particular challenges Black women might face starting and sustaining a business.
As entrepreneurship interventions and initiatives consider other ways to assist new business owners, I hope they consider challenges impacting Black women, specifically. Resources like mentoring, networking workshops, and education related to combating racial and gender discrimination for other owners could alleviate certain problems impacting Black women’s experience with business ownership. Providing the tools to be successful in crowdsourcing, participating in pitch competitions, and juggling full-time employment with personal businesses would also aid Black women entrepreneurs.
Taylor M. Jackson is a doctoral candidate in the Sociology department. She studies race, gender, work & organizations, and media representation.
The feature image is from Pexels.