A new report from BE NYC and New York City’s Department of Small Business Services mirrors the disparity and challenges faced by Black entrepreneurs across the country. Although New York City’s Black population stands at 22% (1.9 million), only 2% of the city’s businesses are Black-owned, the first-of-its-kind report revealed.
Among their top challenges, Black business owners cited:
- Access to capital. (More than 2/3 of the 230 survey respondents who tried to get loans from small business lenders or banks were denied.) This mirrors national data that indicates Black founders are denied financing more frequently than any other racial group.
- Lack of resources and background on running an operation.
- Marketing and customer acquisition.
- Access to affordable workspaces.
The challenges play into another gap that exists between Black-owned businesses and their white counterparts in New York City. The report reveals that white-owned firms are seven times more likely to scale and employ other people while only 3% of Black-owned businesses have employees. Black-owned firms tend not to last as long as the average business in New York City, either. Black-founded businesses operate on average for between four to five years, compared to an overall six to 10 years for non-Black-owned firms.
The analysis was based on data taken from historical research, scholarly articles, public information, and the experiences of more than 1,500 Black entrepreneurs from every borough and across industries.