Deeply Rooted: The Significance of Black History Month & Black Women Entrepreneurs

ByNWBC Council

Deeply Rooted: The Significance of Black History Month & Black Women Entrepreneurs

This year’s National Black History Month theme, African Americans in Times of War, is the opportunity to commemorate the centennial to the end of World War I (1918) and how African-Americans have marked a widespread impact in American culture and society. Women entrepreneurs, especially black women entrepreneurs, have been a key population contributing to the socioeconomic growth and vitality of this country since its foundation. According to the 2012 U.S. Census Bureau’s Survey of Business Owners and Self-Employed Persons (SBO), there are more than 1.5 million black women-owned businesses, a near 67% increase from 2007. Black women entrepreneurs are one of the fastest subgroup of entrepreneurs of this time with an average net of 259 firms being created each day between 1997 and 2017 – the most number of firms created per day out of all subgroups of women-owned firms. According to the 2017 American Express OPEN Report, between 1997-2017, the number of women-owned businesses grew 114%, whereas firms owned by women of color expanded at 467%, four times that rate.

The journeys of entrepreneurship have been present in this country for decades: from current innovators like Council Member Kimberly Blackwell – CEO of PMM Agency, a multi-million dollar brand strategy firm that originated in her very own one-bedroom home; looking back to the early leaders like Sarah Breedlove (Madam C.J. Walker – Founder of Madam C.J. Walker Laboratories and Madam C.J. Walker Manufacturing Company); and Mae Reeves, a necessity entrepreneur. The story of Mae Reeves is one that can resonate with many other women business owners. In 1942, Reeves developed her own hat business, Mae’s Millinery in Philadelphia, Pa. with a $500 bank loan. It developed out of an affinity for her hat-making craft. She then opened up her shop in the same building where she and her family lived, providing her with the ability to live out her dream and support her family during the Jim Crow era. Her business became a symbol for not only intergenerational black fashion, but also civic engagement and empowerment.[1] Black women continue to turn to entrepreneurship at soaring rates – many times out of necessity.

Traditionally, necessity entrepreneurs have been defined as such entrepreneurs who sought business ownership to meet their basic economic needs of survival. However, for women like Mae Reeves, and many other women business owners throughout the years, entrepreneurship has played a multidimensional role in their lives – even beyond an emergency need. The Council examined such motivations for entrepreneurship in their July 2017 report, Necessity as a Driver of Women’s Entrepreneurship which expanded “necessity entrepreneurship” to encompass motivations such as: lack of employment options, failures in workforce policies for women and families, market failures that hinder economic self-sufficiency, and the greater flexibility in self-employment. In October 2017, the Council also released Necessity as a Driver of Women’s Entrepreneurship: Her Stories which uses case studies of nine diverse women to examine whether and how women turn to entrepreneurship to address potential market failures that limit their ability to maintain or attain economic self-sufficiency, or alternatively, to overcome flexibility bias and potential stigma in balancing work-life conflict assumed in traditional gendered roles and social norms.

Although black women-owned firms, like Mae Reeves’ have found particular success in originating businesses, there are still various challenges that they face – which should encourage the broader entrepreneurial ecosystem to better support their business journeys. Black women entrepreneurs still lag behind their non-minority and male counterparts in terms of revenue, business expansion, employment, and average income for their households. As presented in the NWBC Black Women-Owned Businesses Fact Sheet, the average receipts for Black women-owned businesses are $27,753 – the lowest for all major racial and ethnic sub-groups, underlined in the 2012 SBO, although they represent the majority of Black businesses in the U.S. Despite such challenges, black women entrepreneurs are still persisting and pushing the entrepreneurial envelope – creating economic opportunity and innovation for the present and future generations. Mae Reeves once described her business start as, “A calling for me, something that I loved to do,” and many individuals continue to tap into their own motivations to move forward with their dreams via launching their businesses.[2]

The importance of continued research, learning, and work toward viable solutions for equal opportunity and support for Black women entrepreneurs remains effervescent as their success is America’s success. The National Women’s Business Council remains committed to conducting critical research and finding data that can spark action-oriented policy change. To learn more about our research on Black women small business owners and entrepreneurs, be sure to check out our Black Women-Owned Businesses Fact Sheet, in addition to our research report on Black Women Entrepreneurs: Past and Present Conditions of Black Women’s Business Ownership, commissioned by NWBC and the U.S. Small Business Administration’s (SBA) Office of Advocacy, prepared by Walker’s Legacy and released on October 2016.

Author: Shannon Trudge, Program and Operations Manager at the National Women’s Business Council.

 

[1] “Mae Reeves’ Hats Hang at National Museum of African American History and Culture.”NPR, 18 September 2016, https://www.npr.org/sections/codeswitch/2016/09/18/493758448/mae-reeves-hats-hang-at-national-museum-of-african-american-history-and-culture

[2] Ibid.

About the author

NWBC Council editor

The National Women’s Business Council (NWBC) is a non-partisan federal advisory council created to serve as an independent source of advice and counsel to the President, Congress, and the U.S. Small Business Administration on economic issues of importance to women business owners.