The 2023 State of Black Business report found only 3% of companies owned by Black women survive longer than five years.
PHOENIX — August is National Black Business Month — a time to recognize and support Black entrepreneurs across the country. And according to a new report, Black women in America are the fastest growing demographic looking to start new businesses.
For a third year in a row, the State of Black Arizona and the Greater Phoenix Economic Council joined forces on the State of Black Business Report, which looks at the growth and challenges black entrepreneurs face.
Among the findings in the report, Black women account for 37% of all black-owned businesses.
Researchers from Babson College found that 17% of Black women are in the process of starting or running a new business, compared to 15% of white women and only 10% of white men.
The study found only 3% of Black women-owned companies survive longer than five years
Jamila Stewart is looking to change that trend with her company Events By Jamila.
Her company aims to help people create memorable moments through her custom designs and décor.
“The pressures of a 9-to-5 corporate America job just wasn’t for my life. I like to think of myself as a rebel,” she said.
Using her own savings, she started her company in 2019 in an effort to spend more time with her young son.
She said she made $40 in her first event, but she said her business has taken off with the help of repeat customers, referrals, and word of mouth.
“Having relationships is important to me. Sometimes it not what you know, but who you know,” she added.
Phoenix trails other large cities when it comes to private equity to fund businesses and provided information on a black business support ecosystem. The report from the Black State of Arizona found a lack of funding severely limits Black-owned businesses.
It recommends creating venture funding opportunities, improving credit terms for Black-owned businesses, bridging the financial institution gap and building strategic partnerships.
The majority of Arizona’s Black-owned businesses reside in Phoenix and Tuscon, with the most concentration in Chandler, Mesa, Scottsdale, and Tempe. Most of these Black-owned businesses are likely in food services, retail, and manufacturing because of the lower financial threshold, according to the report.
But Stewart is looking to push beyond that. She wants to expand into other cities across the country to make her designs and décor well known.
“I’ve done events in Chicago, and New York. I would definitely like to more travel,” Stewart said.
To help close the funding gap for Black women-owned businesses, the Tempe Chamber Foundation and Wells Fargo are teaming up to give out $100,000 in grants to Black women entrepreneurs in the Phoenix Metro.
Recipients of the Black Women in Business Supportive Grant can receive anywhere from $5,000 to $15,000 to help develop and grow their businesses.
The deadline to apply is September 22nd at 5 p.m. and finalists will be notified in October.
The full State of Black Business Report can be found below:
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BLACK STORIES FROM ARIZONA