By Earlene Greene
- PayPal, Pepsi and Facebook have committed $530M, $400M and $100M to Black-owned businesses
- 81% of Venture Capital funds have no Black investors
Black business owners are suddenly finding themselves receiving more attention, the kind of interest from companies most of them have only dreamed of. Companies including PayPal (PYPL -1.09%), Pepsi (PEP -1.20%) and Facebook (FB +0.10%) have committed $530 million, $400 million and $100 million to Black-owned businesses. Seemingly, a definite win for Black businesses, but will the trend continue and will mainstream investors get with the program?
Why This Matters: In order to really move the needle for these businesses, they are in need of investors. One 2011 study found that investors are more willing to invest in startups that their peers are familiar with. When 81% of Venture Capital funds have no Black investors, Black founders who did not build their network by attending top MBA programs or working for big-name companies find themselves left out of the kind of networks crucial to receiving funding.
This past May, Eniac Ventures founder, Nihal Mehta took to Twitter and offered free appointments to Black founders. “Bridging wealth inequity is one way we can help address our structural racism,” he tweeted. In less than 12 hours, his investment firm had booked over one hundred 15-minute meetings.
During the last month alone, marketing agencies like C+R Research have received a huge spike in requests for educational presentations about the Black community and consumers. “Brands are finally starting to realize the importance of investing in understanding Black people and other minorities with them”, says Ashleigh Williams, a researcher for the agency, told Fortune.
Situational Awareness: It’s no secret that Black-owned businesses were the hardest hit by the pandemic experiencing a 41% drop in business ownership. However, social justice and racial equality has led to overwhelming interests and support of businesses owners. Even JPMorgan Chase committed to hiring 4,000 Black college graduates by 2024 and announced a $5 million investment to its Advancing Black Pathways program, which provides resources and support for Black-owned businesses.
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Chaplain Earlene Greene is President of Faith Walk Enterprises, a Community Empowerment Leader, a Personal Financial Counselor & Trainer. You can follow her on Twitter and LinkedIn
