Businesses owned by black women in the United States have been growing significantly since 2002, more than doubling in total numbers, sales and employees. There has been, however, little research on this growth. While these businesses are some of the smallest on average, their economic impact is growing, particularly within their communities. This makes understanding the motivations, challenges and support systems important to economic and community developers and policymakers. Black women are the only racial or ethnic group with more business ownership than their male peers. These businesses are heavily clustered in fewer industries relative to businesses owned by other major demographic groups. Black women who start businesses tend to be between the ages of 35 and 54 and are more likely to be college educated than black women who don’t own a business. They also are more likely to report having had challenges in accessing credit when compared to non-minority women owned businesses. Black women who own businesses are determined self-learners, who mostly are motivated to start their business because of passion and to escape challenges in the workplace. They are challenged at startup by a lack of business knowledge and mentoring. Their support system is limited and they most often gain support from family and friends. Many black women who own businesses say they have been treated negatively because of their race and gender. Finally, the Federal Reserve Bank of Kansas City recommends taking an entrepreneurship ecosystem building approach to support black women who own businesses. This approach looks at reforming, expanding, or developing organizations, institutions and programs that take a culturally sensitive and inclusive approach to supporting the needs of black women within a community context. For more information on entrepreneurship-led economic development and entrepreneurship ecosystem building visit here.
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