Successfully scaling a startup during a worldwide pandemic can be challenging. Being a Black female entrepreneur trying to scale a startup successfully can seem impossible.
Fortunately, the data shows that achieving success as a Black female is very possible. The last year has been surprisingly kind to Black female entrepreneurs, with 70% of female Black business owners saying they are either “somewhat happy” or “very happy” with their businesses.
This success has been the result of an ongoing trend over the last decade. Research into the growth of female-owned businesses in the US found that women of color are starting businesses at 4.5 times the rate of all companies. They also account for 50% of all women-owned businesses from 2014 through 2019, making them the largest minority of female business owners.
Here’s how you can join these women of color and also achieve startup success:
- Recognizing that it’s possible to succeed
- Defining your MVP
- Being creative when it comes to raising capital
- Drawing on community support
1 – Developing and Defining Your MVP Strategy
Most startups that achieve success have used a “Minimum Viable Product(MVP)” model. An MVP approach supports you in tightly defining the problem and then guides you in developing a minimal form of your product to test on the market.
This strategy allows you to validate (or invalidate) product assumptions. You also learn how your audience uses, reacts, and experiences your product’s core functionality. Throughout this process, you will identify user pain points and determine the appropriate product functionality to address those needs over time. Defining an MVP also provides insight into how to budget effectively. When combined with a platform that can support you when tracking your finances, it can also help you monitor your spending and save you headaches from number crunching.
Developing an MVP strategy helps you to focus on the product. Setting up the actual business – incorporation documents, contracts, and KPIs – can come later.
Developing an MVP helps to draw investors’ attention towards the product, rather than yourself. This can benefit you if you’re a new or first-time entrepreneur.
2 – Becoming a Part of a Supportive Community
Building your MVP strategy and obtaining financial support is a significant achievement for a startup.
That’s only the start of the hurdles you may face as a Black female entrepreneur, but here’s the silver lining. There is a specific community of other minority entrepreneurs that have been in your shoes and are willing to advise you, support you, and even invest in you.
Ultimately, as a Black, female entrepreneur, you need to connect with a supportive community of other Black female entrepreneurs as early as possible. They can give you the support, advice, and knowledge you need to get through the challenges you may face in that first year of business.
3 – Accessing Business Capital and Financial Support
Developing an MVP strategy is the easy part. For any startup, success is primarily defined by the amount of money raised in the first few funding rounds, and Black, female-owned startups are no exception to this.
However, when it comes to raising that capital, there is a significant difference. Black female entrepreneurs find it extremely difficult to access “traditional” forms of financing. Reports based on the most recent Small Business Credit Survey (SBCS) found that Black entrepreneurs were around 10% more likely to apply for financial startup assistance than their white counterparts. Yet, they were 19% less likely to be approved.
Unfortunately, there are still no easy answers when it comes to this issue. However, there is still hope. For one thing, the cost of starting an online business in today’s world is typically much lower than it used to be. As Toronto-based online marketer Gary Stevens of Hosting Canada points out, it’s possible to build a website and get a business going with no initial cost at all.
According to Stevens, you should view the website building service you choose as more than just a simple platform, he explains, “Is a website builder your business partner? That’s one way to look at it. For those long on the entrepreneurial spirit but short on cash, a website and a good idea could be all you need to find small business success.”
The Bottom Line
The world of business may seem to favor white men, but that’s no reason why Black females, among other minorities, can’t succeed in that world. There is no special way of running a Black-owned business. As long as you have the right strategies, financial support, and actionable advice from other Black entrepreneurs, there is no reason why you can’t succeed.
This was written by Nahla Davies and originated on SCORE.