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The reality of building a foundation of wealth as a Black founder

The author writes that, for there to be systemic change, there must be Black leaders at the tables where a community makes its decisions.

The reality of building a foundation of wealth as a Black founder
[Source illustration: Andriy Onufriyenko/Getty Images]
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When people talk about minority business, they too often think only of businesses that are small and struggling. They talk about supporting these businesses in social service terms, as if they’re attempting to care for them instead of enabling them for success. Their focus is not on economic development and job creation, and it’s surely not on generational wealth. By thinking solely about small businesses, they miss a big opportunity when it comes to closing the equity gap. If you’re talking about growing Black-owned businesses and you’re not also talking about Black wealth, you are missing the transformational community opportunity.

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Most small businesses are neither designed to grow nor to create significant wealth. Rather, their primary function is to provide products or services to their customers and income for the owners, their families, and their employees. When successful, these businesses provide the connective fabric that make a community unique. They create jobs, secure neighborhoods, and act as catalysts for additional investments in the area. They are foundational to healthy neighborhoods and to a thriving community.

Yet, if we only succeed in supporting these small businesses, it does not systemically enhance the road to equity. Our opportunity is to support the growth of those select Black-owned businesses that are designed to build significant wealth for their owners.

For us to create systemic change, we need wealthy Blacks at the tables where community decisions are made. We need Black people helping to determine how communities function and how priorities are set. We need Black people seated at the table discussing issues and making lasting decisions as community leaders.

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In many cases, community leaders are the heads of businesses that have been around for generations. Occasionally, leaders of businesses that are “up -and-coming” are included. They’re recognized for their potential to be one of the next multigenerational families of wealth. Longevity and relationships are a part of why these privately held businesses can influence decisions; their accumulated wealth is another. Do you see how the future of the community is being crafted by the few at this table? Just as space is created at the table for the up-and-coming entrepreneurs, adding successful Black entrepreneurs will help build an inclusive community that reflects the insights and influence of Black people, too.

Supporting a select segment of business owners is not a new concept. Communities have always supported the relatively small percentage of entrepreneurs with growth aspirations. That desire is the source of various tax incentives, public private partnerships, and job creation credits. A focus on Black entrepreneurs means equitably enabling Blacks to build businesses that create significant jobs, make capital investments, and build significant personal wealth.

Longevity and wealth are the superpowers of business. The wealth creates influence, and the longevity enables the long-term thinking and commitment needed for deep investment and lasting change. Creating significant wealth and sustaining business growth are also primary challenges for Black-owned businesses. The advantages provided to others as a head start are tough to erase. Think about it. Two generations ago, we were still digesting civil rights legislation and figuring out how to desegregate schools. Growing these businesses is unlikely to happen without an intentional effort.

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How can entrepreneurs build assets to pass on to the next generation? The primary way to gain significant multigenerational wealth is through the ownership of a business built to do just that. Yes, entrepreneurship and business growth is the primary way to build significant wealth in our country. Black wealth is rare, and therefore generational wealth is almost non-existent. Black entrepreneurship is the American way to change this dynamic.

To clarify, I’m not saying wealth is the only way to make meaningful changes that improve our communities. I am saying wealth and influence are linked, and business ownership is the catalyst to both. I challenge you to take stock of the landscape of activities you would describe as pursuing racial equity. What percentage of that effort is focused on equitable opportunities to create wealth? Freedom from oppression cannot become our only goal.

The city benchmarking trips almost always include a diverse group in race and gender. One could look at the makeup of the group and see diversity well represented. Most often, the Blacks at the table are leaders of major employers, non-profit organizations, and community groups, or they’re elected officials. They are, in no way, mere tokens. Yet there is a reality inherent to an individual’s professional affiliation. Their voices are important, but they are typically not free to speak and to question and to challenge with the level of influence needed to create systemic change.

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Contrast this to the voices of those who own and operate the private companies who are mainstays in the community. These individuals have the power to make decisions and financial investments in support of any initiative presented by the group. Adding this profile of Black entrepreneurs to trips like this would be worthwhile. And adding them to the community decision making process is the transformational opportunity.

Let’s use the influence we have to push for a plan to enable more wealth-creating Black-owned businesses. Creating peer Black-owned businesses will take unrelenting commitment by non-Black business leaders—and it won’t happen overnight. We will know we are making progress when we see Black-owned companies of scale next to their White peers. We will know we are succeeding when Black-owned businesses are passing from one generation to another. This long-term strategy will take a generation to see sustainable change.

Communities will realize many other benefits of having more Black-owned businesses creating significant wealth. Wealthy Blacks engage in philanthropy at higher levels than others. They serve as mentors, inspirations of possibility, and developers of talent. They do their part to set the stage for more opportunity, different perspectives, and increased empathy. Therefore, it is in all our interest to create a thriving community where everyone feels engaged in the process of framing the future. As catalysts, Black entrepreneurs are an important signal of our community’s intent. If the goal is equity, specifically focusing on building wealth-creating Black-owned businesses is not just important; it is imperative.

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From Dear White Friend: The Realities of Race, the Power of Relationships and Our Path to Equity by Melvin J. Gravely II. Copyright © 2021 by Melvin J. Gravely II. Reprinted by permission of Greenleaf Book Press.

Melvin J. Gravely II CEO of a commercial construction company in Cincinnati, a civic leader, and the author of Dear White Friend: The Realities of Race, the Power of Relationships and Our Path to Equity.