In My Own Words: Federal Reserve Bank of Kansas City’s Black Women Business Startups Report
By Adrienne B. Haynes, Esq.
The Federal Reserve Bank of Kansas City released the Black Women Business Startup Report in the spring of 2018. If you haven’t seen it or saved it, you can find the report and other materials here.
I participated in the study as a Community Partner through SEED Law and the Multicultural Business Coalition, a 501(c)3 nonprofit small business support organization. Over focus groups and community luncheons, black women entrepreneurs convened to laugh, share lessons learned, and to see the journey quantified in data. Thank you to author Dell Gines for your leadership on the project.
As I review the report and consider my own journey, I wanted to share a few reflections:
Stage Set by Existing Systems
When talking about certain realities, opportunities, and challenges faced by Black women in business, I believe we have to take a systems view and approach. I was first introduced to systems thinking during my Innovator in Residence fellowship and have included a list of resources below.
In “Thinking in Systems- A Primer”, author Donella H. Meadows helps introduce a systems lens using a slinky. In manipulating the slinky, she extracts that “once we see the relationship between structure and behavior, we can begin to understand how systems work, what makes them produce poor results, and how to shift them into better behavior patterns. As our world continues to change rapidly and become more complex, systems thinking will help us manage, adapt, and see the wide range of choices we have before us. It is a way of thinking that gives us the freedom to identify root causes of problems and see new opportunities. So, what is a system? A system is a set of things — people, cells, molecules, or whatever — interconnected in such a way that they produce their own pattern of behavior over time.”[1]
In this context, without this larger systems perspective, we can’t fully understand the scale of the barriers that Black women must navigate to pursue entrepreneurship and generational wealth. For a Black women to be successful in both the entrepreneurial and corporate environment, she has to have a well-executed (likely hard learned) set of strategies to navigate the sea of microaggressions and systemic challenges- disparities that have been perpetuated through social, political, and economic institutions and reinforced through norms, laws, and public policy. That means we have to acknowledge or at least consider the systemic barriers that impact day to day life including norms set in play long ago- from the failure of Freedman’ Savings Bank to laws that intentionally imposed limits on a people’s ability to build political, social, and individual, financial capital through vehicles like segregation, redlining, healthcare disparities, and the school to prison pipeline and all of those resulting impacts on the Black family.
Even so, the women whose stories are represented in this report and beyond have started companies, learned, and earned as they went. Even if the side hustle is only yielding $27K today, that is a viable start. With the right mix of tools, access, relationship and capital, the seeds will grow. Creativity loves constraints, and laying this foundation helps us better understand why the dominant characteristics for those who participated in the study were determination and self-learning. This also likely why black women are described as “discouraged borrowers”. The system(s) that we’ve been operating in and asking permission from have been saying no for so long, that Black women are the reining experts at figuring it out anyway.
Storytelling & Data Matters
One of the many lessons I’ve learned through MBC and my exploration of community designed innovation hubs is that the contribution to data and storytelling matters. What we regularly see, we tend to believe. If we continually see data or media that generalizes and disparages, over time we can begin to normalize, expect, and internalize it. This is not only important on an individual level, but on a larger community level. This is why it’s so important to ask critical questions when the news only reports one perspective or yet another article floats by about which cities are the absolute worst for black entrepreneurs.
We have to ask:
- Who wrote this?
- Who compiled the data?
- What were the sources?
- What questions were asked to get to this information?
- For what purpose is this being published?
- Who is the intended audience?
- What else is the data being used for?
For the Black Women Business Startups Report, I appreciated the academic nature in which the data was collected and reported. The process, questions, and research are transparent and easily accessible. I also appreciate that the Federal Reserve Bank of Kansas City took time to listen and make this research a priority.
The research was clear: despite two economic collapses (impacts of 9/11 and the housing market crash), the “recent growth in the rate of business ownership by black women has been faster than any other group in the nation. From 2002–12, the number of businesses owned by black women increased 179 percent compared with 52 percent for all women-owned businesses and 20 percent for all businesses.”[2] What are we doing for COVID-19, ladies?
The report gives us a data driven profile of a woman who is educated, determined, and grown who may have had some savings already and started either a full time or side hustle in all industries from service to health care to construction, and she’s making money from it, employing others, and serving her community. I don’t know about you, but she’s my hero!
So now what do we do with that information?
As a Black woman in business, share your story! Sure up your firm foundation and intentionally cultivate your CEO skills.
Determination and self-learning were the top qualities recognized in the focus group participants for the report. We have to apply this same fervor to our finances. I would argue that a great majority of the population is not taught healthy lessons about money at home, which is apparent given the ungodly levels of poverty and wealth gaps across the world. Combined with what we’ve already discussed, and credit abuse by family members, predatory lenders, debt, underemployment….(the list could really go on), lessons learned about money can come hard earned. Sis….I know.
When you’re running a business, if you don’t know your numbers, you really don’t know your business. It’s hard to make pricing decisions, projections and budgets without strategy. If you are looking for some tips on healthy money management, you don’t have to have it all figured out on your own! As a business owner, you’ll be doing as much learning as unlearning, and this article may help outline a few steps to make the numbers less scary and more accessible in your business.
As a customer, I’d encourage you to support a local Black woman-owned business (and maybe even pay her more than what she’s asking instead of the opposite). If she is fantastic, spread the word. If there is something else she can do to earn your business, share it constructively.
For ecosystem builders, I encourage you to reach out and engage the Black women in your region. Ask her what she’s working on and what she needs help with. Hear her story. Volunteer. Consider mentorship or sponsorship. Don’t assume her business is “just a Black thing”. You may be surprised at how much that assumption is actually verbalized (it even showed up in the report).
A final takeaway for ecosystem builders and resource partners is a gentle reminder that your network is your net worth, and the data supports the premise that if Black women are well supported in their entrepreneurial pursuits, the family, community, and region all benefit economically.
Each One, Teach One
The pursuit of entrepreneurship is a manifestation of the human right of self-determination- the ability to define one’s own way. I wrote about this concept in 2012 here: The Advancement of Human Rights through Social Entrepreneurship (excerpt).
For those of us that do have businesses, we have to share what we’re learning. The greatest cooks write cookbooks! Write that book, publish that online course, and bring on an intern to share what you’re learning with the young folks too.
If you’d like to continue to conversation or contribute your story, let me know here. To learn more about my entrepreneurial journey and the work that I do through SEED Law and SEED Collective, I’d love to hear from you.
Additional Resources
Mackenzie Martin, With ‘Resiliency And Grit,’ Black Women In Kansas City Have Been Growing Their Own Businesses KCUR Central Standard, https://www.kcur.org/show/central-standard/2020-03-08/with-resiliency-and-grit-black-women-in-kansas-city-have-been-growing-their-own-businesses (last visited Apr 22, 2020).
[1] Donella H Meadows, Thinking in Systems: A Primer 2–3 (Diana Wright ed., Earthscan 2008) (2008).
[2] Dell Gines, Black Women Startup Report Federal Reserve Bank of Kansas City, https://kansascityfed.org/community/smallbusiness/black-women-business-startups (last visited Apr 22, 2020).
