FEA_BlackFemaleBusiness_Christine_Haines_Greenberg_Urban_Set_Bride_SELAH_MARIE_rp0623_wide-feature.jpg
Christine Haines Greenberg, owner of Urban Set Bride (Photo by Selah Marie)

Business Barriers

Despite challenges, Black women are breaking through

by

Jenn Braswell had been running Hour Cycle Studio in Richmond for two years when she outgrew the space. While she was looking for a new location, a landlord not only presented her with unfavorable terms, but he also required that her husband cosign the lease. Braswell was stunned. Her husband isn’t affiliated with her business. She holds a bachelor’s degree from William & Mary, an MBA from Virginia Commonwealth University, another full-time job and a proven record of success.

“I felt like it was because I’m female,” she says. “My male friends aren’t asked to have their wives sign. If I’m a single woman, are they going to ask my dad to sign the lease?”

When Christine Haines Greenberg opened Urban Set Bride, an upscale boutique, in 2014, she could sense some of her customers were apprehensive.

“Being in a historically Black neighborhood is important to us, but some of our customers don’t seem comfortable coming to Church Hill,” she says. “Subconsciously, some see ‘Black-owned’ and think it won’t be as nice, and we can tell they’re surprised when they come in. It’s not outright racism, but I get that tingly feeling.”

Elsie Harper-Anderson, who holds a doctorate in city and regional planning and researches equity in Richmond’s entrepreneur ecosystem at VCU, hears stories like these more often than she’d like. “In 2023, you would think [such] ways of thinking have subsided, but they have not,” she says. “Women-owned businesses aren’t necessarily seen the same. And at the intersection of Black and female, it’s even more difficult — there are still stereotypes and misperceptions.”

About 3% of U.S. firms classifiable by race are owned by Black adults, according to a recent study from the Pew Research Center, despite Black people making up 12.4% of the population in 2020. By contrast, white Americans compose 59.3% of the population and own 85.6% of U.S. businesses with employees.

Overall, 63% of classifiable businesses are owned by men, 22% by women, and the remainder are owned jointly by men and women. Of Black-owned businesses, 55% are owned by men, 37% are owned by women, and 8% are jointly owned. Pew notes that 4% of American businesses are not classifiable by race, but such firms generate 62% of all revenues.

“The statistics are dismal and deplorable,” says Rasheeda Creighton, co-founder and executive director of Richmond’s JWC (Jackson Ward Collective) Foundation, which provides resources to minority businesses. “Opportunities are not equal, and the barriers to access are huge.”

First in a Generation

In 2019, Creighton, Kelli Lemon and Melody Short started the foundation to help minorities overcome barriers and break glass ceilings. The organization’s name pays homage to the early trailblazers of Richmond’s Jackson Ward neighborhood such as Maggie Walker, the daughter of slaves who in 1903 became the nation’s first Black woman to establish a bank.

Creighton was inspired to start The JWC Foundation while serving as executive director of Richmond’s 1717 Innovation Center for up-and-coming entrepreneurs, where she recalls “many participants in the program did not look like me.”

She applies her experience with startups, as well as knowledge gained in working toward her law degree, to build diversity in Richmond’s business landscape. The foundation provides budget coaching, legal services and business classes to help minority businesses so that when they do get seed money, they are ready for the next steps. Their popular BLCK Street Conference will be held Aug. 6-7.

Creighton says the generational wealth gap is real and that many African Americans don’t have friends or family who can just write them a check. One of the missions of the foundation is to provide that backbone of support.

Creighton and Harper-Anderson note that being the first in a generation, whether it’s going to college, getting into politics or running a business, is a difficult feat.

“The literature shows that if your parents own a business, you are more likely to be successful as a business owner,” Harper-Anderson says, “but for African Americans in particular, our parents were less likely to be entrepreneurs. You can’t just call your parents and ask them how to run a business.”

The Cost of Doing Business

If Braswell, the cycle studio owner, had wanted to open a franchise of an already established brand such as a CycleBar, doing so would entail a cash requirement of $100,000 and a total investment approaching $500,000, according to Entrepreneur magazine. And if she had needed a loan, she faced a high chance of being rejected.

According to J.P. Morgan, Black business owners who apply for funding are turned down three times as often as their white counterparts. “Black females are the most underfunded group,” Creighton says. “We often go to lending because we don’t have family funds, but getting a loan means starting deeper in debt.”

Many business owners can’t get a line of credit through the bank until their business is 2 years old, despite needing capital to grow their business and hire more employees. It’s a Catch-22: You need credit to get credit.

Rather than going with a mass-market franchise, Braswell created a business plan tailored to a niche audience. Instead of taking out a loan, she self-funded her cycling studio. More than 60% of Black startup companies are self-funded, according to Harvard Business Review.

With her personal savings, Braswell purchased Schwinn bikes designed for stationary spinning at $3,000 each, leased studio space, bought insurance and hired a team of instructors. When opening her business, she relied on JWC Foundation experts for help.

“My husband is an attorney, and I have my MBA, but I’d never run my own business before,” Braswell says. “JWC was a repository for all the things I didn’t know. Until I leave this earth, I’ll be so grateful to them.”

Today, Hour Cycle Studio is successful, classes are full, and Braswell has signed a fair lease — without her husband.

Uphill Battles

Harper-Anderson says too many Black and female-owned businesses must fight for resources, and they often don’t know where to look. Before Greenberg opened her bridal shop with her mother, she spent hours looking for business grants while juggling a career as a wedding consultant.

“There’s such a barrier of entry, and traditional banks are intimidating,” she says. “We needed a commercial space that wasn’t expensive and didn’t need to be built out — we didn’t have the luxury of going to Lowe’s every day to fix things up.”  

Greenberg and her mother relied on a business credit card and their savings in addition to a grant to start their business, purchasing computers, lighting and inventory. They’ve received two grants totaling $12,500 in the past nine years through the SEED program from the nonprofit Local Initiatives Support Corporation, in partnership with Bon Secours and Capital One. Greenberg used her most recent grant, awarded in 2022, for upgrades to the shop, where she serves a wide and inclusive clientele.

“Banks are looking for larger loans with longevity, but you’d be surprised what $5,000 or $10,000 can do to help propel a business forward,” Creighton says. “People want to know how to help the problem: Write Black women a check.”

Funding is also difficult for females entering the technology field. According to PitchBook data, only 2% of venture capital funding goes to female-only founder teams in the U.S. Harper-Anderson would like to see more resources available in Richmond and initiatives that encourage more Black women to enter the tech sector.

“Black women aren’t taken as seriously as entrepreneurs and aren’t recognized as innovators, especially in technology,” Harper-Anderson says. “I came to Richmond 11 years ago, and when I went to entrepreneurial events, I rarely saw an African American, and when I did, it was likely a man.”

What the Numbers Say

Richmond has made headlines for being a favorable climate for Black-owned businesses. According to the Greater Richmond Partnership, 5.9% of Greater Richmond businesses are Black-owned — more than twice the national average — placing the city sixth in the country. But Harper-Anderson says that, despite its progress, Richmond can do better. Approximately 29% of the Greater Richmond population is Black or African American.

Part of the problem lies with the data. “I’ve been doing research on race around Richmond, and the data on entrepreneurs is definitely incomplete,” she says. In addition, “a lot of energy has been focused on race and less on the nexus of race and gender.”

For instance, the U.S. Census Bureau’s Annual Business Survey does not include businesses that are both minority-owned and female-owned, and it only reports businesses with at least two employees.

“That’s limiting when you don’t recognize the one-person show,” Harper-Anderson says. “Over 90% of Black businesses don’t have employees. The business could actually be much bigger and contract out. The fact that the data doesn’t recognize a sole proprietor says something right there. It creates a perception they are less valuable.”

Before the COVID-19 pandemic, Black women were the fastest-growing group of entrepreneurs in the country, increasing 50% from 2014 to 2019 for a total of 2.7 million businesses, according to J.P. Morgan. But women, especially, faced another setback in 2020.

“Women-owned businesses were impacted more severely by the pandemic because they are the primary caregivers — kids had to be homeschooled, and sick family members had to be taken care of,” Harper-Anderson says. “Women bore a disproportionate burden.”

Greenberg felt the pressure as a small-business owner during the pandemic, when she had to close her bridal shop for months. Not only were weddings being postponed indefinitely, but she also faced inventory shortages from China — all while caring for a new baby.

“There is a general underestimation of women,” Greenberg says. “I see women all the time working two full-time jobs and planning a wedding. We’re pretty amazing.”

A lot of energy has been focused on race and less on the nexus of race and gender.

—Elsie Harper-Anderson, VCU economics professor

Other women, like Tracey Wiley, used the pandemic to launch new careers. When her mother asked how she could run a household, a full-time job and a side business, Wiley answered simply, “With care.”

Under Govs. Ralph Northam and Terry McAuliffe, Wiley led the Virginia Department of Small Business and Supplier Diversity. At the state, she oversaw a disparity study analyzing contract and procurement dollars awarded to minority-owned businesses. The study revealed that, from 2014 to 2019, 13.4% of all state contracts were awarded to woman- and minority-owned businesses. Wiley says that, based on qualifications, that number should have been closer to 33%.

“Coming out of COVID, my mindset about my career changed, and I wanted to contribute in a different way,” she says. “Policy drives everything — how a business grows, how they receive access to capital, how much they pay in taxes. Small businesses don’t have the lawyers, accountants and lobbyists of large firms. I want to work behind the scenes for organizations and businesses who may not have a seat at the table.”

Through her consulting firm, Rainmaker Industries, she has served clients including Virginia’s Minority Business Development Agency, working to support and advance minority companies.

Wiley says that while there are still plenty of challenges for minorities in business, she’s seen a change since the Black Lives Matter movement’s activity in 2020.

“There’s been a rebirth, a refresh and an intentional message of trying to make sure people are included,” she says. “I’m working with companies to take a look at their workforce, try to understand them and make them feel they belong. We’re thinking more about audiences and customers who are different and embracing them as authentically who they are. The shift is happening.”

Grants and Resources