Editor’s Note: This piece is part of an ongoing series on female entrepreneurs of color. Read more here.
We’ve all seen (and discussed at length) the facts and figures on women owning businesses — the numerous studies, reports and more that reinforce the fact that, while female entrepreneurs are a positive and influential force in the world’s economy, they are also forced to navigate roadblocks in their startup paths because of their gender.
For example, many women in the United States have found that it’s harder to connect with mentors, win over VCs and (until recently) secure government contracts. And in other parts of the world, entrepreneurial women are even subjected to abuse because of their independence.
Here at The Story Exchange, we are ardent supporters of all women — regardless of age, race, religion or nationality. As such, we also believe in the importance of “intersectionality,” or the examination of how various forms of oppression interact with one another. It’s important to look at the issues specifically faced by women business owners of various races, in addition those that affect all female entrepreneurs — after all, as writer/activist Flavia Dzodan once famously said, “My feminism will be intersectional, or it will be bullsh*t.”
That is why we are launching a project that will focus on the experiences and challenges unique to female entrepreneurs of color. After all, a quick glance at the numbers reveals that these women are still greatly underrepresented in the world of business ownership, and still experience increased difficulty when trying to access funding:
- Currently, 11.7 percent of all women-owned firms across the country are owned by African-American women, 10.2 percent are owned by Hispanic women, and 6.7 percent are owned by Asian women. That accounts for less than 30 percent of all women-owned business in the United States. (Source: National Women’s Business Council)
- In all, 60 percent of white women business owners were able to obtain bank credit, while just 50 percent of Hispanic, 45 percent of Asian, and 38 percent of African-American women entrepreneurs could do the same. (Source: Go 4 Funding)
- Women, African-Americans and Hispanics who owned businesses were all less likely to apply for new loans than white, male entrepreneurs. Specifically, blacks and Latinos were almost three times less likely to do so, because they feared having their application denied. (Source: Small Business Association)
- In 2010, 67.4 percent of loan applications from white business owners were approved, in comparison to 28.2 percent of African-American/Hispanic applications. Meanwhile, 63.2 percent of applications from male entrepreneurs received approval, in comparison to 59.5 percent of applications from female entrepreneurs. (Source: Small Business Association)
- Race impacts female employees, too — in 2012, African-American women made 64 percent, Latina women made 53 percent and Asian women made 87 percent of the wages earned by their white, male counterparts. (Source: American Association of University Women)
And, it should be noted that none of these inequalities touch upon the systemic issues that women of color deal with in their everyday lives, or the intentional and unintentional racism experienced in their workplaces. It’s especially frustrating to observe these problems while simultaneously seeing statistical proof of the growing power and earning potential in firms led by women of color:
- Businesses owned by women of color presently provide jobs for 1.4 million people in the U.S., and generate an average of $226 billion in revenue annually. (Source: National Association of Women Business Owners)
- African-American women start businesses at a rate of six times the national average. And as of 2013, Latina-helmed businesses totaled $65.5 billion in receipts. (Source: Center for American Progress)
- A subset of the U.S. Department of Commerce says “minority women-owned firms are the fastest growing.” (Source: Minority Business Development Agency)
So, why is there still a disproportionately low level of engagement in entrepreneurship within certain ethnic communities? Why is it more difficult for these women business owners to access funding? Who is challenging the status quo, and how?
We’ll be examining these questions — and many others — in this project. We’ll speak with representatives from organizations and businesses that help women in these communities access funding and grow their ventures. We will also highlight the first-person insights and anecdotes of female entrepreneurs of color.
By shining a spotlight on these issues, we aim to perpetuate conversations that will hopefully pave a smoother path for tomorrow’s racially diverse women business owners.
We invite our readers to check back for more on this topic, and to engage us via email ([email protected]) or on social media through our Facebook and Twitter accounts. And, if you’re a female entrepreneur of color, please weigh in on the subject by filling out this questionnaire (coordinated with the Public Insight Network).