Black Women, Growing by Leaps and Bounds, Yet Receive Unfair Capital
According to American Express, black women are the fastest out of any racial group to start a business. Statistics show that firms owned by African American women have grown by 164% since 2007, unfortunately, the same cannot be said about the access to capital for them.
While entrepreneurship in the US is definitely struggling, especially after the market has taken a major hit due to COVID19, it is still far more difficult for women of color.
It’s unfortunate that men, even today, receive the majority of funding and capital and a mere 2% goes to women. Out of the 2%, women of color literally get scraps. According to a survey, black women face a lot more problems and struggles in comparison to non-minorities when it comes to gaining access to credit.
It goes beyond just struggling to gain access to credit and capital. Black women also report that they tend to not receive the entire, or in many cases, any of the financing they appealed for. The likeliness of black women being denied loans is much higher than non-minority peers. The unfair treatment extends further to the point that they are also asked to pay higher interest rates in comparison to non-minorities and banks are also biased and discriminatory its a form of subprime lending similar to the upside-down mortgages.
Women Owned business report show minority women entrepreneur generating over $420 billion in revenue for the economy. Women of color count for over 80% of new business ventures however venture capital, angel capital, or traditional capital doesn’t reflect the same fair math.
There are black women focused funds such as Black Girl Ventures, Twenty65, Lightship Capital, and Black Women Talk Tech who are creating a change in the dynamics and helping out black women entrepreneurs in starting up and supporting their businesses. We definitely have a way to go. With venture capital funds like these, I’m confident we will see more in the future.
Originally published at https://www.culturecurbside.com.