An Equitable Economic Recovery Post-COVID Needs Inclusive Small Business Entrepreneurship
In the past year, millions of Black, Latino, Native American, women and other groups of workers have been laid off or forced out of the labor market due to the ongoing pandemic. Even as the American economy begins to show signs of recovery, nearly 1 in 10 Black Americans is still unemployed, and employment for Black women is 9.7% lower than it was in February 2020. COVID has also dramatically hurt the health of small businesses everywhere, but Black and Hispanic-owned businesses have been disproportionally impacted.
To truly ensure economic racial justice and a more equitable recovery post-COVID, we need to help existing and would-be BIPOC entrepreneurs. We need to expand access to inclusive small business entrepreneurship -- to provide all under-represented entrepreneurs with the tools and support to launch a variety of small businesses in their communities. And we need to help established businesses rebuild. These small businesses are a critical component of a vibrant local economy since they create jobs that won’t be automated or outsourced.
Starting a business in any environment is a daunting prospect. For someone without a financial safety net, a professional network, or familiarity with topics from marketing to bookkeeping, it can seem impossible. By investing in effective scalable programs like Entrepreneurship for All (EforAll) we can expand inclusive small business entrepreneurship in communities nationwide.
EforAll was founded in 2010 by serial entrepreneur Gururaj “Desh” Deshpande (best known for co-founding Sycamore Networks), who saw inclusive entrepreneurship as a way to revitalize a community’s economy from within, small business by small business. He understood that the individuals who live in a community would know what kind of services it lacked, and the types of ventures that would both succeed and fill an unmet need.
He also understood that an aspiring small business entrepreneur -- particularly one who is Black or Latino -- requires different support than the next Mark Zuckerberg or someone looking to launch a global tech company. For one thing, the small business entrepreneur probably has a day job they can’t quit to join a tech accelerator for a year. They may not have role models who’ve shown them that entrepreneurship is a viable option. Their capital needs, while significant to them, are much lower and their potential funding sources are scarce.
To be effective, programs that serve under-represented small business entrepreneurs must meet these individuals where they are on several levels. For example, EforAll programs are available in English and Spanish. The year-long business accelerator is free, and the class schedule takes into account that these budding entrepreneurs have other commitments. EforAll helps participants learn how to address critical early-stage business challenges (including creating a value proposition, fundraising, bookkeeping, pricing and social media) and uses mentoring and peer support to build confidence and a local network. Experts and mentors show participants how to boot-strap a business with the goal of turning it into a full-time job, and without the expectation that these new entrepreneurs can live without other income while they build their dream business.
For community outreach, EforAll holds frequent pitch contests in grassroot locations (i.e., church basements and community centers), where anyone can join to test a business idea, win cash prizes, network with local business owners and meet potential customers -- a great way for everyone to get inspired and see what’s possible.
Lorne Jenkins, a Black entrepreneur in Colorado, entered the first-ever EforAll Longmont Pitch Contest a week before the deadline -- and won first place. According to Lorne, the pitch contest was the first time he had told anyone other than his family about his idea for a new business, a financial literacy app called Mini Money Management: “It was nerve-wracking but the confidence it gave me, to see that the idea was validated, was invaluable.”
Lorne went on to apply to EforAll’s Longmont Accelerator Program, where he says, “One of the most important classes for me was Value Proposition, homing in on what the actual service you’re providing is.” The week before COVID closed down schools, Lorne had just completed a pilot program with teachers. He quickly shifted to develop a home version of his product that catered to parents who were now struggling to find educational activities to do with their kids. He credits EforAll with helping him and his classmates adapt: “EforAll gave us the confidence and the knowledge to be able to pivot.” In December, Lorne was named one of “Colorado’s 2020 Inno Under 25.”
At EforAll, each entrepreneur is matched with three local business leaders, who serve as mentors and act as an unofficial board of directors for the new venture. They meet weekly with the entrepreneur to help them shape their business and think through the topics being taught in the classroom. By tackling challenges from product or service definition to target customer identification to demand validation, pricing, channels to market and so much more, within three months the mentors ensure that the entrepreneur is ready to launch and has a plan for the first year. Mentors then meet with the entrepreneur monthly to help them stay on track and make adjustments as they learn from market experience. After the entrepreneur completes the year-long program, they transition to on-going alumni programs and can join a peer-to-peer mentoring cohort for long-term support.
This winter I mentored Keisha Greaves, a young Black woman who is battling muscular dystrophy. Inspired by her own challenges, she launched Girls Chronically Rock a few years ago, hoping to develop an adaptive clothing line. She began by building her brand and selling inspirational graphic T-shirts that celebrated living with a disability, but needed help in achieving her dream. After joining EforAll and working with her mentoring team, she is ready to launch her adaptive swimwear line, called “Adaptive Splash,” which is accessible for people with disabilities. Her other mentors and I were deeply involved in validating the market need, determining her pricing and setting her marketing approach. She now has her product in production, a strong go-to-market strategy and a concrete launch plan.
According to Keisha, “My mentors were amazing. They helped me focus on my main vision and pushed me to answer all the critical questions I needed to resolve before launch, like pricing.”
For privileged entrepreneurs with extensive networks and comfortable bank balances, failure is disappointing, but life goes on. For entrepreneurs like Keisha Greaves, a thriving business is far more critical to their long-term financial health and success.
And the success of these ventures goes far beyond the individual entrepreneur. Successful small businesses transform individuals and communities, create jobs, revitalize Main Street and ensure a sustainable tax base to help address other societal challenges. They also create more favorable conditions for big business to set up shop locally -- a community with more options for dining, shopping, and leisure activities is more attractive to corporations and potential employees. This then creates a positive feedback loop where small businesses lead to more big businesses, which in turn provides more customers for small businesses. For context, five years after EforAll launches its no-cost small business accelerator, a community can expect to see more than 130 new businesses that generate nearly $6 million in revenue and create more than 250 jobs (Source: EforAll Annual Impact Surveys, 2014-2019).
Jon Mitchell, Mayor of New Bedford, Massachusetts, has seen EforAll’s impact on the community in the five years since its launch: “[EforAll] has helped strengthen our city by contributing to economic development in New Bedford -- activating networks of volunteers, spurring new business growth and creating jobs, and leading to fewer vacancies in our downtown.”
The pandemic has unleashed a new wave of interest from aspiring BIPOC entrepreneurs, some from necessity of economic circumstance and some finally pursuing their long-time dreams. EforAll’s programs have been over-subscribed throughout the pandemic as laid-off workers look to take control of their own economic future. Last March, EforAll pivoted to full online delivery of its entire programming -- pitch contests, classes and mentoring -- and unlocked new potential for its reach and delivery model. They’ve been able to maintain and grow community engagement even in a virtual world.
EforAll currently serves entrepreneurs in nine communities across Massachusetts as well as in Longmont, Colorado. The program is now working to launch in Buffalo, New York, Northwest Arkansas, and Rhode Island with plans to expand into other states soon.
Inclusive entrepreneurship is a powerful tool for battling income inequality and workforce displacement. As we seek to tackle the dual impacts of the pandemic and systemic racism, we must support these aspiring entrepreneurs. Successful small businesses help build individual wealth, employment, community confidence and local pride. Anyone working to ensure racial economic justice and the resiliency of the broader economy should be investing in inclusive small business entrepreneurship and in making the American dream accessible to all.
About the Author:
Gail Goodman spent 17 years as CEO of Constant Contact, the trusted provider of online marketing tools for small businesses and nonprofits. Gail led the company from pre-revenue to a successful IPO in 2007 and through its acquisition in 2016 for $1.1 billion. Gail is a true believer in the power of entrepreneurship to transform lives and communities. She helps under-represented entrepreneurs turn their dreams into reality working with Entrepreneurship for All (EforAll) as both a mentor and Board Chair. Fostering entrepreneurship is Gail’s passion and mission and she is dedicating the next chapter of her professional career to scaling organizations and programs focused on small business success. Gail also serves on the Boards of Pepperlane, Shopify (NYSE: SHOP), and Lola Travel.