Entrepreneurship Provides New Hope for Former Prisoners

Programs to teach and facilitate business ownership are springing up around the U.S. in a bid to expand economic opportunity for women leaving prison.

Riva Richmond By Riva Richmond

Sharon Richardson of Just Soul CateringToday, Sharon Richardson is the possibility of love and abundance. 

In 2015, she founded her Brooklyn social enterprise, Just Soul Catering, which cooks Southern specialties like collard greens, mac n’ cheese and fried chicken and delivers them to events around New York City. Not only has the business become the bedrock on which Richardson is creating economic opportunity for herself, she is also hiring other formerly incarcerated women to staff her events.

“We cook our food with a lot of love, and we serve the community,” says Richardson, a domestic violence survivor who was released from prison in 2010, after serving 20 years for killing her abusive boyfriend. She is building Just Soul Catering with Chandeerah Davis, an activist and the daughter of a man who is currently serving a 35-year sentence.

Healing has been at the heart of the enterprise since the women started dreaming it up, Richardson says. “We talked about the recipes of our grandparents and how food brought everyone together on their worst day.”

Just Soul Catering is a part-time venture — for now anyway. Richardson and Davis both work full-time at the New York City nonprofit STEPS to End Family Violence, and Richardson is the founder of Reentry Rocks, her own nonprofit for formerly incarcerated women with histories of domestic violence and trauma. But Richardson has a vision: She wants to link Just Soul to Reentry Rocks, launch a culinary school to train Just Soul employees, add a food truck and open a cafe in The Women’s Building, which is being created in a former jail.

“I see myself today as a motivational speaker, a teacher and inspired leader, as a mentor, a mom, a grandmother and as a women who’s empowered,” she says. Richardson has remade her life and is now giving out second chances. “My story is a gift to give people.”

Richardson’s rebirth as the CEO of Just Soul Catering began with training and mentoring from Defy Ventures, a New York nonprofit that runs an entrepreneurship program for currently and formerly incarcerated men and women. In June 2016, she won $10,000 in Defy’s “Shark Tank”-style Capital Call Competition.

Defy is just one of a growing number of organizations around the country that are helping formerly incarcerated women and men pursue business ownership in an effort to expand economic opportunity for a group that struggles to secure jobs.

And now, their movement is getting a shot in the arm from the U.S. Small Business Administration (SBA). In 2016, it launched the Aspire Entrepreneurship Initiative with microlender Justine Petersen and the W.K. Kellogg Foundation, a 3-year, $2.1 million pilot program to educate and facilitate business ownership for formerly incarcerated parents in four cities. And just last month, the SBA announced a related program to support other entrepreneurship initiatives for the formerly incarcerated: the Aspire Challenge, which will disburse $1.2 million in grants to organizations.

An Economic Imperative

This effort is vital, advocates say, in the age of mass incarceration. More than 2.3 million people are in jail in the U.S., and some 640,000 people return to society from prison each year. According to a survey conducted for Ella Baker Center for Human Rights, a staggering 67 percent of former inmates are either unemployed or underemployed 5 years after their release, a sobering statistic given that employment is strongly associated with reduced recidivism.

A participant in Building Entrepreneurs For Success in Tennessee makes her pitch.

A participant in Building Entrepreneurs For Success in Tennessee makes her pitch.

Though women are only 7 percent of the state and federal prison population, their number has jumped fourteen-fold since 1970 — from 8,000 to 110,000 — compared to a four-fold increase for men, according to the Vera Project. This makes helping formerly incarcerated women find economic opportunity a growing imperative.

Proponents of entrepreneurship programs say former inmates have a lot in common with successful entrepreneurs — they hustle, think outside of the box and are determined and resilient. Indeed, some have run thriving criminal enterprises.

“That creative hustle, when applied appropriately, is what makes a person successful in any realm. If we can apply that in a legitimate way, that is positive and productive,” says Tameka Montgomery, associate administrator for the SBA’s Office of Entrepreneurial Development. “The goal is to make [entrepreneurship] more accessible.”

Of course, the formerly incarcerated face an array of daunting challenges in starting legitimate businesses, starting with criminal records and including low levels of education, underdeveloped business “soft skills,” often crippled self-confidence and little if any personal savings to start or grow companies.

For women, a return to full-time caretaker roles of children can be both an additional challenge and extra motivation to make a success of an entrepreneurship opportunity, says Karen Vander Molen, co-founder of Building Entrepreneurs For Success in Tennessee (BEST), whose 2015 and 2016 entrepreneur cohorts have been all-women. Women also tend to be more willing to take on the painful personal work of overcoming their pasts, which are often scarred by sexual abuse, violence and drug addiction, she says, and remake their lives.

Program directors like Vander Molen say the many challenges mean that to be successful entrepreneurship initiatives must be intensive, high-touch efforts that address the array of problems the formerly incarcerated face.

The grandfather of these initiatives is the 13-year-old Prison Entrepreneurship Program in Texas, which only works only with men and was founded by Catherine Hoke, who also founded Defy Ventures. It is perhaps the most intense program of them all — and it has an impressive success record to show for it.

PEP has a highly selective application process and begins working with participants well before their release from prison. It also facilitates post-release transitional housing and employment, so participants can create a steady foundation before they ever start businesses. By the end of 2015, PEP graduates had started more than 200 companies, half of which have at least one other employee and six that generate more than $1 million in annual revenue. It has helped some of these businesses secure funding, including loans via the socially minded Kiva and PeopleFund. Graduates have an exceptionally low recidivism rate of less than 7 percent 3 years after release, compared to a national average of nearly 50 percent.

Building Entrepreneurs For Success in Tennessee“Starting any business is hard,” says PEP’s CEO, Bert Smith. Add to that the challenges of returning from prison, and “that takes it up a notch, wow.” Teaching the men what it takes to run businesses also makes them more employable, he says. “We don’t aggressively push our guys to start a business as fast as they can. What we’re interested in is their long-term success.”

Restoring Dignity, Healing Rifts

BEST, which is just over 2 years old, is looking to replicate PEP’s results with Tennessee women, and uses PEP as a model. It runs a 6-month program that begins with an educational effort inside prison that includes guest speakers, the Toastmasters public-speaking program and even Stephen R. Covey’s “The 7 Habits of Highly Effective People.”

Participants have worked on business plans for a beauty salon, gift-basket service, designer-clothes thrift store and event-planning company as well as food trucks and cleaning services, Vander Molen says. Only five women have left prison so far. None have launched businesses yet, but all have found jobs within a month.

Helping the formerly incarcerated get back on their feet and pursue business ownership brings many benefits. “They’re a citizen again. Let’s get real. We either allow them to restore the dignity in their lives, or we continue to beat them down,” Vander Molen says. Helping them to earn decent, honest livings and be contributions in the world, “it’s a win-win for them and society as a whole.”

June Lee found that kind of restoration through a Northern California program called Project ReMADE that’s run out of the Stanford Law School. Co-founded by Angela McCray, a former law student now corporate lawyer at Gunderson Dettmer, and Debbie Mukamal, executive director of the Stanford Criminal Justice Center, the program is led largely by a rotating cast of law and business students, who teach participants and mentor them together with Silicon Valley executive volunteers.

When Lee joined Project ReMADE’s first, all-woman class in 2012, she admits she was scared. She had been released from prison in 2010, after serving 20 years for attempted murder and robbery. Behind bars, she learned to read, and finally earned her GED in 2008. There, she also made and sold sold crafts, which won her consistent praise and allowed her to leave prison with $400 in after-tax profits.

When Lee heard about the program, “my first instinct was, oh no, not Stanford, because there’s such incredibly smart people there,” she says. But then she thought, “‘June, you fought to hard to have your freedom back, and you can do it.’… I knew it was a good fit for me, because I always wanted to start my own business.”

Lee’s mentors helped her create a business plan for an accessories company, come up with the name Leo Designs SF and design a logo. But most importantly, “it brought people into my life… It brought up a confidence in me,” she says. “When I question myself, my talents, my products, I remember the big things and the little things that people [there] said to me.”

Debbie Mukamal, left, looks over some of the leather bracelets designed by June Lee.

Debbie Mukamal, left, looks over some of the leather bracelets designed by June Lee.

Today, Lee makes handcrafted purses, wallets and bracelets from old leather and unconventional materials out of an Oakland artist and maker space called Qulture Collective, and she sells them through its retail shop. Leo Designs SF remains a part-time venture — Lee has a full-time house painter job with benefits — but she is mulling taking on a full-time role at the Qulture Collective boutique or opening her own store and studio.

“I’m just surrounding myself with some great entrepreneurial women” and moving forward slowly. “If people are looking for solutions and to live a productive life, you will find that,” she says. “I believe in everybody’s lives there are difficulties.”

Aspiring for More

The SBA wants to make sure many more women like June Lee are able to create constructive lives. Its new Aspire Entrepreneurship Initiative is just getting off the ground with pilot programs in Chicago, Detroit, St. Louis and Louisville, Ky., that offer training and the opportunity to access SBA-backed microloans.

The pilot launched in St. Louis in December with an all-male class — by chance, not design. Justine Petersen, the social-mission-driven microlending company that will deliver the training and make the loans, says it will recruit an exclusively female second class in the city and ensure that the other pilot cities host co-ed classes.

All applicants must have jobs that provide a regular income and the ability to repay loans. The Kellogg Foundation, which is providing most of the funding for the program, focuses its philanthropy on children and is keen to use this program to stabilize families. As such, applicants must also have children aged 8 or younger.

The participants so far are optimistic, passionate and chomping at the bit to get their businesses off the ground, says Galen Gondolfi, a spokesperson for Justine Petersen. Some are “struggling with having to start small and build,” he says. “They believe their business can be successful” and want to become employers.

“One thing different about this program is there’s real money to lend,” Gondolfi says. “There’s no shortage of entrepreneurship curricula out there. What there is is a shortage of is capital.”

While many of the other entrepreneurship programs believe that developing social and business skills is most important, it’s true that access to capital can be particularly difficult for the formerly incarcerated. They often lack personal savings and may not have family and friends who are able or willing to help them fund a start up.

By demonstrating success with the pilot, the organization thinks it can woo more funders to the microlending cause, Gondolfi says. It also hopes to expand to more cities with additional support from the SBA; it plans to compete for dollars in the agency’s upcoming Aspire Challenge. “We’re hoping to do significant lending,” he says.

For its part, the SBA wants to help entrepreneurially minded returnees from prison provide for themselves and their families by giving them “tools so they can create a job for themselves,” Montgomery says. It’s about second chances, strong and whole communities and, she says, the imperative that we “ensure all Americans have access to opportunity.”

Posted: January 19, 2017

Riva RichmondEntrepreneurship Provides New Hope for Former Prisoners