Black Entrepreneurs Turn Passion Into Profits

Survey finds African Americans start small businesses to pursue dreams but may be more likely to face financial challenges

Getty Images

By:

Published October 29, 2018

Benita Johnson loved wine, especially the way that — when mixed with good food and good company — the drink could transform a meal into a memory. Her problem was the nearest wine shops were more than a 25-minute drive from her home in Richmond, Virginia.

Having grown up in a household where her father owned his own bricklaying company, Johnson, 49, knew how to spot an opportunity when she saw one. So, in 2005 she opened the first of two wine shops called Grapes & Barley, which now have morphed into The Vine Wine Club, an online subscription service that delivers wines Johnson handpicks to members's doorsteps.

Johnson says starting her own business gave her the chance to shape her own financial future and, more importantly, the opportunity to turn her dreams into reality.

“You know, you’re seeing so much transition in the workforce,” says Johnson. “I think now is a perfect time to figure out what your passions are and turn those passions into livings. And we can do it.”

For African Americans who own small businesses, passion is a big part of what drives them to start their own companies. According to a recent survey of more than 2,600 people who either owned a small business or were hoping to start one, 62 percent of African American respondents said the reason they went into business was to pursue a passion. That response was 11 percentage points higher than the number for all respondents. The survey was conducted by Guidant Financial.

Twenty-five percent of black small-business owners were between the ages of 50 and 59, with another 16 percent in the 60-69 age range, according to the survey.

The survey also suggested, however, that black business owners may face particular challenges with regard to raising money. For example, 80 percent of black respondents said their biggest challenge was lack of capital or cash flow, which was 10 percent higher than all respondents. And, 46 percent of black small-business owners were their only employee, while another 41 percent had 2-5 employees.

For many small businesses, a large staff isn’t necessary. Jennene Biggins, 52, runs her own consulting firm that specializes in digital marketing for other small businesses. She started J Biggins Consulting in 2001 after owning another small business for years: a boutique that sold women’s plus-size clothing, both online and from a small shop she operated in the basement of her home. When the 2009 recession led to a crash in her apparel sales, Biggins realized that she could turn the expertise she developed in online marketing into her current business.

“Many people with my plus-size businesses were wondering, you know, how did I do it, what was I doing online,” she says. “So that’s kind of how I fell into consulting, you know? Maybe I need to start something to help others.”

That kind of help and support can be crucial for small-business owners, especially among women and minority communities.

“The biggest hurdle or challenge is the mentoring,” says Beverly Grandison, 38, an Army veteran who now runs Premier Health + Wellness Consulting in Chesapeake, Virginia. “Sometimes we feel like we’re having to just start all over, do it by ourselves. It’s harder, it seems like, than it should be. It’s a matter of tapping into the resources that are there locally where you are.”

Grandison recommends that aspiring entrepreneurs take advantage of their local Small Business Development Centers, which are funded in part by the federal Small Business Administration. Biggins recommended SCORE, which is a nonprofit association that helps small-business owners by providing mentoring and other resources.

%{postComment}%

Unlock Access to AARP Members Edition

Join AARP to Continue

Already a Member? Login

Benefits Recommended For You

See All