Heartland Forward joined civic and business groups at the National Civil Rights Museum in Memphis to release its latest report, Black Business Opportunity Strategy: The Journey of Black Business Owners in Memphis.
MEMPHIS, Tenn., Oct. 16, 2023 /PRNewswire-PRWeb/ -- Heartland Forward joined civic and business groups at the National Civil Rights Museum in Memphis to release its latest report, Black Business Opportunity Strategy: The Journey of Black Business Owners in Memphis. Memphis is unique because it has the highest Black population share among metropolitan areas with 1 million-plus people. This means Memphis has a larger Black population than St. Louis, Boston and San Francisco, for example. Entrepreneurship is a wealth-creator and can be a powerful economic development strategy for communities and regions, especially when entrepreneurs are given the tools they need to succeed.
Heartland Forward, with the support of a coalition of partners – StartCo, Christian Brothers University, Black Business Association of Memphis, The Greater Memphis Chamber of Commerce, Downtown Memphis Commission and the City of Memphis, examined the unique data and characteristics of the Memphis entrepreneurship ecosystem to provide the following key insights:
- Memphis has a density of Black-owned businesses, but they are disproportionate to the population size. Forty-six percent of the adult population in the Memphis metro is Black, but only 7.3% of employer firms are Black-owned – employer firms employ more than just the business owner herself, an indicator of entrepreneurship success.
- Memphis is home to a large number of Black-owned nonemployer firms that, if supported, can reduce the employer firm disparity. There are 1,158 Black-owned employer firms in the Memphis metro, compared to 12,968 white-owned employer firms. There are 54,500 Black-owned nonemployer firms, compared to 57,000 white-owned nonemployer firms.
- Business ownership creates positive externalities for personal wealth generation and communities. Fifty-nine percent of Black individuals whose main source of income is self-employment are homeowners, compared to 50% of Black individuals who work for someone else.
- Inequities in resources exist, such as only 80% of Black owners of incorporated businesses have high-speed internet at home, compared to 90% of white owners of incorporated businesses.
- Age can be a positive factor. The self-employment rate among those younger than 40 is 47% of the white rate, while the Black self-employment rate for those 40 and older is 60% of the white rate. Black individuals are able to overcome some of the barriers to entrepreneurship as they move through their careers.
The core components to a successful entrepreneurship journey include: technical assistance, funding and scaling and access to the broader professional community.
Informed by input from Black-business owners and community leaders through focus groups and informational interviews, the report makes the following public policy and programmatic recommendations:
- Move material resources to fill the experimentation gap experienced by Black business owners so that entrepreneurs have the resources to test and develop products, services and business models.
- Close the digital divide for small businesses: Black business owners faced unique challenges pivoting during the COVID-19 pandemic, largely due to that lack of access to high-speed internet and sufficient skills to properly utilize the technology.
- Build bridges for Black business owners. Black business owners are isolated from opportunities and relationships to partner with white businesses, which limits their ability to scale and their exposure to innovation and mentorship.
- Lessen dependence on necessity entrepreneurship through wealth and skill building: we estimate nearly 80% of Black business ownership are "side hustles." Support services should better support the Black population in securing upward mobility so these side hustles ultimately are replaced by thriving incorporated businesses building their business by adding an employee base.
"The journey entrepreneurs embark upon is complex and nonlinear; it often involves multiple loops of starting, stopping and tweaking the business model before getting it right," said Ross DeVol, president & CEO of Heartland Forward. "For underrepresented populations, entrepreneurship is exponentially more difficult. With the resources and commitment Memphis has to seeing its entrepreneurial sector grow, we are enthusiastic Memphis is on the right track. We thank our partners, the business community and Mayor Strickland for working with us on this comprehensive report that we expect will be a guide for communities across the country."
Mayor Jim Strickland said: "It was our original goal to grow our supplier diversity numbers, begin working with external partners to serve more black businesses, and to change the dialogue on how we and the community can better support. This is where The 800 Initiative began with a multitude of great partnerships bringing resources to the region. We are happy now to see that this effort has produced a data report that will have cascading returns for years to come."
Through our analysis of Black business in Memphis we have evaluated the key areas of support for Black entrepreneurs: technical assistance, funding and scaling and access to the broader professional community. By implementing programming and policy centered tailored technical assistance for Black businesses by stage of business development and industry, creating pathways for Black business owners to connect within and outside their communities and celebrating the achievements of thriving Black enterprises in the city, Memphis can foster the growth and empowerment of Black entrepreneurs and businesses.
With this report, Heartland Forward hopes to spread recognition of Black entrepreneurs and businesses across the country that experience similar trials and tribulations. The data collection and analysis methods used for this report can be applied to different cities, regions and communities, helping to identify the key areas cities need to focus on to develop programming and policy supporting and growing Black business and ultimately increasing racial economic equity in the United States.
The full report can be found HERE.
About Heartland Forward
Heartland Forward is a think and do tank dedicated to being a resource for states and local communities in the middle of the country. We do this by studying broad economic trends and building data-driven and community-tested partnerships, programs and policies to address the needs of the heartland to help change the narrative about the middle of the country and accelerate economic growth.
Media Contact
Blake Woolsey, Heartland Forward, 1 4799576301, [email protected]
SOURCE Heartland Forward
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