Black-owned businesses across North America have a rich legacy, one that shows no sign of slowing down. While some of us may think of Black entrepreneurship as relatively new, members of the Black community have long made inroads in business sectors as diverse as health care, aesthetics, construction, restaurants and retail, real estate, and technology, including Artificial Intelligence (AI) and robotics, to name but a few.
Yet despite the many success stories, Black business owners still encounter challenges regarding racism, access to capital, and other issues. Fortunately, awareness of Black-owned brands and businesses is on the rise, aided by social media and dynamic organizations in Canada and the United States that are helping to shine a light on the many opportunities, products, and services that come from members of the Black community.
A legacy of innovation
For Black innovators, the road to success has been far from an easy one and to this day, the names of many Black pioneers in their fields remain largely unsung. Inventors like Johann Gutenberg, creator of the printing press; Jethro Tull, inventor of the seed drill; telephone pioneer Alexander Graham Bell; and Thomas Edison, who held 2,332 patents worldwide (1,093 in America alone) for countless devices, are household names. But shamefully, many of the names of pioneering Black innovators, inventors, doctors, engineers, and businessmen and women remain relegated to history textbooks.
While the name Marie Van Brittan Brown is relatively unknown, for instance, her work has helped make the world a much safer place.
Frustrated by excruciatingly slow police response times, Brown, a nurse, invented the basis for today’s home security systems when she attached a camera to a series of peepholes in 1966. And without the valuable contributions of Otis Boykin—who held over 20 patents—many men and women with heart issues would not be alive today. Creating a resistor initially used in computers and guided missiles, Boykin’s technology soon became a vital part of the success of pacemakers.
Other Black inventors have been behind innovations we use every day, such as the ubiquitous three-light traffic signal courtesy of Garrett Morgan and the foil electret microphone, co-invented by James E. West. Even Thomas Edison’s most famous invention, the incandescent lamp, benefited from introducing a long-lasting carbon filament developed by African American Lewis Latimer.
Gaining ground
The predominant worldview on Black innovators and businesspeople is, fortunately, changing. According to Export Development Canada (EDC), there are an estimated 144,980 Black-owned businesses in the country, representing 2.4 percent of all businesses in Canada. Earlier this year, the U.S. Census Bureau reported there were 3.7 million Black-owned businesses in the United States, a significant 14 percent increase over 2020.
Although these figures are promising, Black Americans comprise some 12.4 percent of America’s overall population of 341,809,591. White Americans, who make up about 59 percent of the population, represent 86 percent of business owners.
In the book History of Black Business: The Coming of America’s Largest Black-Owned Businesses, authors Martin and Jacqueline Hunt detail the early years of Black businesses and barriers to growth. “Slaves, ex-slaves, craftsmen, and many of the nearly 60,000 free African Americans in 1790 contributed in some way to Black business’ past,” state the Hunts. “There were ship builders, fur traders, barbers, saloon owners, and city founders who were entrepreneurs prior to the Civil War.”
In the early days, many of these businesses catered primarily to African American customers, and included insurance companies, banks, and cosmetics companies. Unfortunately, many Black inventors were behind the creation of innovative products which led to successful companies yet were prevented from owning them due to “extreme racial prejudice,” write the authors.
Black businesses on the rise
Today, myriad types of companies are Black-owned and operated, from law firms to fashion retailers, marketing to automotive. In Canada, about one percent of federal business innovation and growth support (BIGS) has been allocated to Black-owned businesses, with the highest numbers in Ontario, Quebec, and Alberta. In many cases, primary business owners are “most likely to be the business owner (or manager) among all known owners and office bearers,” according to StatsCan. And about 75 percent of these businesses are owned by men compared to just 25 percent owned by Black women.
Much like Canadian provinces with larger populations, more populous U.S. states like Florida (with 18,502), California (15,014), and Georgia (14,394) are home to greater numbers of Black-owned enterprises.
Even with more and more Black-owned and operated companies in Canada and the U.S., challenges persist. Statistics reveal Black-owned businesses—compared to white-owned firms—are less profitable, with profit margins of about 8.5 percent compared to 14.9 percent for the latter. Other challenges to growth remain, such as Black-owned businesses often having a harder time accessing bank loans compared to white-owned companies.
Recognizing funding inequities, Canada’s Federal Government created the Black Entrepreneurship Loan Fund, a component of the Black Entrepreneurship Program (BEP), in 2021. Representing an investment of up to $265 million over a four-year period, the BEP is aimed at helping Black Canadian owners and entrepreneurs grow their businesses for success today and into the future. Previously, the Federal Government hosted the now-closed National Ecosystem Fund and the Black Entrepreneurship Knowledge Hub, which focused on mentorship, business training, and identifying barriers to success.
The modern world has brought us tools that make it easier to connect with Black-owned businesses, such as the Black Business Direct website (presented by Uber, at https://blackbusinessdirect.ca), and the Canadian Black Chamber of Commerce (CBCC). The CBCC helps connect Canada’s Black businesses to the Global Black diaspora, while the Black Business Direct site is a convenient, easy-to-use site where customers can search by city and categories like Food & Hospitality or Home Improvement.
Certainly, Black-owned businesses not only benefit their owners and customers with goods and services, but also provide much-needed jobs and a boost to the nations’ economies. Through raising awareness and access, the number of Black-owned businesses across North America will surely continue to rise and play an even more important role in job creation and community impact in the years to come. Supporting these businesses is not simply a matter of economic growth, but also of fostering diversity, equity, and inclusion within our societies, for the betterment of all.
