When the Black Lives Matter movement was front and center in the national spotlight following the killing of George Floyd by Minneapolis police, there came a push for the community to support Black-owned businesses.
Lists of local businesses with Black owners circulated on blogs, websites and social media, and Danielle Smith, the communications director for the Colorado Black Chamber of Commerce, which is based in Denver but works with businesses across the state, said phones were ringing off the hook.
“We were getting flooded with phone calls from businesses all over the state saying, ‘Hey, we don’t know how we can show support but we want to try to give back to Black businesses,’” Smith said. “One of the things that came out of these protests and the current state of the U.S. is that it’s been brought to attention that it’s not just about police brutality, there’s a lot of systemic racism we’re fighting in a lot of different areas, and one of the biggest is the [racial] financial gap.
“So we were getting back-to-back calls for a solid six weeks after the protests started.”
But as time passed and demonstrations have become less common, Smith said, the phones have mostly grown quiet.
“I won’t say it has stopped. I still have a couple calls coming in here and there for more referrals,” Smith said. “But I think part of that is that it’s becoming more normal for people to look for Black-owned business they can support. So [the support] is not that big, booming flood like it was for the first few weeks. But I’m hoping that it’s still kind of trickling in … and that our allies are realizing this [need] is an ongoing thing.”
Smith said that due to the COVID-19 pandemic, the battered economy and the country’s current racial equity landscape, Black-owned businesses need that support to continue.
“I think it’s always been important but now there’s this increased awareness,” Smith said. “Now, more than ever, we have people of different colors, shades, and backgrounds all fighting for justice. So we have to react to that, work together and keep pushing.”
THE COVID-19 LANDSCAPE
Minority-owned small businesses, according to the U.S. Small Business Administration, represent about 29 percent of all U.S. firms, or about 8 million businesses when including those without employees beyond the owner.
According to the MetLife & U.S. Chamber of Commerce Special Report on Race and Inequality on Main Street, published in August, those businesses have been disproportionately hurt by the pandemic.
Sixty-six percent of minority-owned businesses polled for the report said they’re concerned about having to permanently close, compared to 57 percent of those not owned by minorities.
Minority-owned businesses were also more likely to report trying and failing to secure a loan to help survive the economic turmoil caused by the pandemic, which aligns with pre-pandemic lending trends.
According to the Minority Business Development Agency, a part of the U.S. Department of Commerce, minority firms are denied loans at a rate three times higher than non-minority firms. And when they are approved for loans, they receive lower average loan amounts with higher interest rates than their non-minority counterparts.
A July study by Groupon and the National Black Chamber of Commerce highlights some of the financial issues minority entrepreneurs have faced during the pandemic — 76 percent of 400 Black small business owners surveyed said COVID-19 has negatively impacted their business, but only 5 percent of applicants said they received a Payroll Protection Program loan.
MICRO AND MACRO SUPPORT
Rodney Gullatte Jr., president and founder of the Colorado Springs Black Business Network, said the lists of Black-owned companies that made the rounds on social media this summer essentially served as advertising and had a direct impact on many Colorado Springs businesses.
“Any kind of advertising is helpful,” Gullatte said. “Especially when it didn’t exist before.”
In the Groupon and NBCC study 75 percent of Black-owned businesses saw an increase in business after protests began.
But Gullatte said the support local Black-owned businesses saw over the summer has seemed to wane over time.
“I definitely haven’t seen the push at that level since that initial time frame,” Gullatte said. “But there are other organizations picking up the slack to make sure that we are still promoting Black-owned businesses out here.”
Janet Brugger, president of the Colorado Springs Black Chamber of Commerce, said several local organizations have stepped up with new programs to support the Black business community, specifically helping to secure funding through loans or grants.
“Patronizing Black businesses is always good,” Brugger said. “But we have to look at — what’s going to happen to those businesses if we have to shut down again? How are they going to be able to maintain if we go through another closure? Because we know that a lot of businesses were not financially prepared before. So we have to look at the macro environment as well as the micro environment so we can make sure there’s equity and funding for these businesses, and also organizations supporting and advocating for them.”
Brugger said the chamber has worked with local startup accelerator Exponential Impact on several projects that benefit Black businesses. The chamber is also working with U.S. Bank on a program that helps Black business owners navigate application processes for loans, PPP funds and other COVID-19 relief.
“We are looking at the needs of the Black business community and U.S. Bank is helping us address those needs and provide education,” Brugger said. “So we’re working on initiatives and discussing policies that we can bring to our constituencies to help them be more financially stable and more financially aware and help them get the education they need for their businesses to be sustainable.”
As another example of large companies stepping up to help Black-owned businesses, Gullatte pointed to a recent Comcast initiative called RISE, which helps issue grants to minority-owned small businesses hit by COVID-19, and offers marketing advice, free ads, technology services and more.
Currently, only Black business owners are eligible to apply, but all small business owners who are Black, Indigenous or People of Color will be eligible to apply beginning Nov. 28.
Another thing that’s endured beyond this summer’s protests, Gullatte said, has been the collaboration between local Black business owners.
“There’s been a rallying cry in the Black business community for us to come together better to drive some of the change that we want to see so we don’t have to wait for the country to give a damn to start seeing investments in our businesses,” Gullatte said, adding large-scale support from companies like Comcast and U.S. Bank has likely created the largest initial surge for Black businesses, but in order for the change to be sustainable, “it has to work on a micro level.”
“Black-owned businesses have to realize how much power they have and they have to believe in all the things they can do,” Gullatte said. “Because once we shift the mindset and these Black business owners see they can achieve way more than they give themselves credit for, we’ll start seeing a shift there also.
“Because it takes both. We can’t wait, as a community, for these large organizations to come in and help us or save us. We have to take responsibility for ourselves.”
WHY IT’S IMPORTANT
A robust presence of Black-owned businesses isn’t just important for Black community members, Brugger said, but is a value for the community and its economy as a whole.
“Just because we’re Black-owned doesn’t mean we’re Black only,” Brugger said. “So we have to educate the community that patronizing a Black business is also going to benefit them in the long run. We know that small businesses, across the board, are suffering. So we need to support one another, whether we’re a Black business or just a small business in general, we need to support one another.”
What does Colorado Springs stand to lose if Black businesses don’t survive the pandemic?
“It loses a thriving Black community,” Gullatte said. “Colorado Springs is on the come up right now. This is Olympic City USA where everybody’s welcome. We’re already seeing that we’re attracting people to come here and if we want to keep attracting people we need to have things here that make them feel welcome.
“And when we have a thriving Black economic force, that transcends business. It gives us a chance to talk policy and have a voice in the great changes that Colorado Springs is undergoing right now. A strong business community gives you that voice.”