- Mentorship and advice from successful business owners can help you navigate challenges in receiving funding and networking.
- Instead of underpricing your services to gain clients, price your services based on market rates and how much your services are worth.
- Use social media, pitching and word of mouth to network with potential customers and gain new clients for your business.
- This article is for emerging Black female business owners who are seeking advice on building their companies.
Black women in America share a unique experience as business owners because of the struggles they face, rooted in both systemic sexism and racism, often resulting in a lack of funding options.
To better understand what challenges Black female entrepreneurs face as they get their businesses off the ground, we spoke with five successful business owners who shared how they overcame their trials and offered advice for other Black women entrepreneurs.
Business tips for Black female entrepreneurs
Because of funding hurdles and other issues, Black women entrepreneurs face unique challenges when starting a business. For example, according to a 2021 report from the Federal Reserve Banks of several cities, on average, Black entrepreneurs completed more applications for financial startup assistance than any other group. However, Black entrepreneurs were half as likely as white entrepreneurs to receive full approval for small business loans and other business funding sources.
Learning from other successful business owners is one of the best ways to overcome challenges and reach your full potential as an emerging entrepreneur. Whether you already run a business or want inspiration to get started, here is some advice from Black women entrepreneurs.
1. Save money before you reach out to investors.
Before starting her entrepreneurial journey with her husband, Dariel, to launch a scented-candle company, Tiffany Griffin pursued a career in academia and policymaking. With an eye on spreading knowledge and effecting positive change, she was motivated to bring awareness to the Black experience. Today, her company does the same thing by incorporating scents inspired by the African diaspora, naming candles after Black trailblazers, and more.
As a “social entrepreneur,” Griffin said she always wanted her products to conjure up both memories and conversations about Black culture. While her mission in business was always to serve others on a cultural and communal level while discussing Black culture, that was the very thing she said was a barrier when she was pitching to business investors. She found that funding was often conditional on compromising the core values of her race-based product line — something Griffin and her husband found troubling.
While Griffin and her husband were in a financial standing where they could dismiss those investors, they acknowledged that many businesses could end up compromising their core beliefs to stay afloat. To avoid finding yourself in that position, Griffin suggested saving up some capital before launching your business to help handle startup costs and operational expenses.
“With financial stability comes freedom,” she said. “We’ve also learned to plan and plan and plan some more … and stick to your values. For us, we really do believe in our values, and we really are trying to do good work.”
The lesson: Griffin advised emerging Black businesswomen to save money before launching their businesses so they aren’t reliant on investors who may require them to make core changes to their businesses.
Accessing funding is a challenge all women entrepreneurs face. Experts advise female entrepreneurs to ask for more funding than they need, to avoid receiving funding at lower levels than requested.
2. Charge what you’re worth.
After working for several years in corporate America, Janna M. Joyner decided she wanted to build a creative marketing agency. Being overlooked for a pay raise and told that the company had no budget for a wage increase pushed her to remove herself from company politics and start her own business, Leap Innovative Group. Though she was familiar with the industry, Joyner said she found it hard to set her own rates because she struggled to advocate for herself.
After lowballing her rates for a long time, Joyner eventually realized that the relationship African Americans have with money on a cultural level differs from that of white business owners, creating a splintered understanding of worth.
“Our white counterparts are used to having capital, used to pricing themselves higher, and had the confidence to stand behind their prices, even when they were higher than the market rate,” Joyner explained. “I realized that if they had the confidence to stand behind their prices, why couldn’t I? I am confident in my expertise … so I should also be confident that I’m worth the price I set for it.”
To overcome this insecurity, Joyner welcomed the counsel of white mentors whose understanding and confidence with money pushed her to raise her rates. She internalized that she was indeed worth her rates and found comfort in researching the average market rates. To that end, she urged Black women business owners to avoid taking rejection personally. When a client says “no” to your rates, she said, it’s a reflection of what they’re willing to pay and not what you offer.
“My clientele now consists of businesses who understand the value I bring and are happy to pay what I’m worth,” Joyner said.
The lesson: Joyner encouraged Black female entrepreneurs to avoid underpricing their services by researching the market and knowing their worth.
Low prices can scare away customers. Customers often believe you get what you pay for and view inexpensive prices as cheap and unworthy.
3. Sell products early.
When she graduated from Stanford University in 2008 and then completed her MBA from Harvard in 2016, Houston native Britney Winters believed she was on her way to bigger and better things and a life of corporate success.
However, after a handful of years of successfully working in investment banking and the fossil fuel industry, she realized she “never could bring my true self to work.” That self-perceived lack of ownership over her career path led her down the path of entrepreneurship to create her own hair extension and wig company, Upgrade Boutique.
Now, with experience as a full-time entrepreneur, Winters said the biggest challenge she faced was getting funding for the business. Though many entrepreneurs and small business owners can get their initial funding from friends and family, that option isn’t necessarily available to Black entrepreneurs. According to data from the Federal Reserve Bank of Boston, white families have, on average, more than four times the amount of wealth as Black families do.
Though she’s had financing help, Winters said she also dealt with funding issues by selling her products at an early stage of her business. After setting up a pop-up store and selling out of her stock in three hours, she earned some capital and an initial customer base. Though it wasn’t at the level she’d imagined, Winters said it was the spark she needed to keep moving forward.
“I think we kind of want the ideas we have to be perfect before bringing it to the market, but I learned that you have to work with what you have,” she said. “Sometimes it is hard to access capital, so just figure out what your most basic prototype of what you can present is … to get your foot in the door. Then you can work toward building it out to your ultimate vision.”
The lesson: Winters urged business owners to make the most of their capital by starting small and selling products at an early stage of the business, thus helping them grow their customer base and earn more capital that they can reinvest in the business.
4. Network to gain clients and mentors.
Though white men have long dominated the world of celebrity and sports public relations and communications, LaTonya Story has carved out a successful career in the industry. She owns LPS Consulting PR, a boutique public relations and marketing firm representing some of today’s biggest talent. Story has worked with famous athletes, like Michael Vick and Dwight Howard, and has received several industry accolades, including the Women in PR Trailblazers Award.
Though she’s now known as a successful businesswoman, Story said she started out having to work harder than her white male counterparts to prove herself. When she started working in PR two decades ago, the only Black woman in her field was Marvet Britto, founder of the Britto Agency. To overcome that hurdle, Story used her networking abilities to sign her first clients. Through “word of mouth, social media and traditional pitching,” she was able to bridge the gap between herself and other established PR professionals.
By being assertive and tenacious, Story said most Black female entrepreneurs can seek out new clients and potential mentors by “not being afraid of reaching out to people.”
“My first opportunity came by way of me calling a radio ad that I heard for the Allen Iverson Celebrity Summer Classic,” she said. “I served as a volunteer for two summers in the public relations department, which allowed me to network and meet professional athletes, one of which took a chance on me and became my first paid client.”
The lesson: Story stressed the importance of networking in seeking out new clients and potential mentors. She advised budding Black women entrepreneurs not to be afraid to take chances and to reach out to people they want to work with.
An excellent PR firm can help businesses weather and deal with PR crises, including negative customer reviews, executive scandals or data breaches.
5. Conduct market research.
As a Black American woman, becoming an event planner in Dubai was already an out-of-the-box career choice for Genera Moore. However, after years of coordinating large celebrity social events in the “City of Gold,” Moore found additional success in a new venture typically run by white men: auto parts.
As the founder of Motorparts Nation, Moore distributes auto parts to mechanics in Ghana. Having found her interest in international trade during her time in the Middle East, Moore said she got involved in auto parts after conducting a market analysis and discovering where auto parts were needed most. While much of her professional life has brought her to parts of the world where Black women aren’t as common as other ethnicities, she said she eventually relied on her race as a “superpower.”
“Being a Black woman has had a lot of advantages, even living in the Middle East,” Moore noted. “I feel like I’m trustworthy, and I have integrity and follow my plan to execute exactly what I said I can do. That’s my advantage.”
Moore realized that, as a Black woman, she could make a difference in communities that need the most help. For Moore, that group is the people of Ghana and, more specifically, the auto mechanics of that country.
“Black women reinvest in the community, and we don’t just focus on our household — we focus on how we can collectively do things to empower someone else or connect with someone else,” she explained. “It may sound like my company is just auto parts, but if you look at the top 10 healthcare epidemics by death in Africa, road injuries are next to malaria, AIDS, and stroke. … My company is out to change it by working to train mechanics on how to make the road safe.”
The lesson: Moore recommended finding a business opportunity by conducting market research and identifying communities that need help.
Aside from conducting market research, business owners can use business surveys to generate leads and assess brand awareness and customer satisfaction.
Why Black women in business need mentorship and advice
Bias still affects entrepreneurship for Black women. Although they pursue higher education at a higher rate than other female minority groups, they still need mentorship to help navigate the challenges of starting and growing a business, such as being approved for funding.
“Black folks have less access to high-worth networks and information, and access like that is pivotal and, in some cases, becomes mandatory for success,” Griffin noted.
Mentorship is vital to the success of budding Black businesses because it helps combat overarching inequalities in the working world. It also gives Black entrepreneurs access to one-on-one advice and an opportunity to learn from others who have successfully managed and overcome these struggles.
“I have the responsibility to share what I know with other women,” Joyner said. “My agency hires Black women out of college because I understand how tough it can be. I wanted to provide a safe space where they can learn and grow and not have their mistakes be a bad mark on their career. I wanted to give them a space to be able to say that they don’t know something.”
Black women entrepreneurs can benefit from mentorship and advice from successful business owners to help them navigate challenges in receiving funding and networking.
Statistics on Black female business owners
Ongoing issues of racial inequality spanning hundreds of years and flaring up in present-day America have not stifled Black women’s entrepreneurial spirit. According to a 2019 American Express report, Black women account for 42 percent of new women-owned businesses, though this minority group represents only 14 percent of the entire female population. Further, research by Harvard Business Review found that 17 percent of Black women either own a business or are in the process of starting one, compared with 15 percent of white men and 10 percent of white women.
Between 2014 and 2019, Black women-owned businesses grew by 50 percent, the highest rate of all female demographics. Some of the business owners we interviewed believe one reason for that boost is that Black women are a creative and adaptable group of people who aren’t afraid to take risks.
“This makes them incredibly brave and pushes them to take leaps,” Griffin said.
Education could also play a significant role. According to the National Center for Education Statistics, Black women earned 13.6 percent of all associate’s degrees, 11.4 percent of bachelor’s degrees and 13.4 percent of master’s degrees during the 2018-2019 school year. Those advanced degrees can provide the confidence and tools entrepreneurs need to launch and operate businesses of their own.
Black women are behind several startups changing the conversation about women’s health. For example, Health in Her Hue connects Black women and other women of color to culturally competent and sensitive healthcare providers.
Dominating business ownership as a minority
As more Black women become entrepreneurs, they are standing strong as a key group of business owners. Obtaining funding for their businesses, keeping them running, and serving their customers nevertheless require a unique strategy and determination. However, the reward of conquering a feat as big as owning a successful business can be well worth the effort.
Shayna Waltower and Andrew Martins contributed to this article. Source interviews were conducted for a previous version of this article.