Resource Guide for Minority-Owned Small Businesses
It’s no secret that a lot goes into starting your own small business. Entrepreneurs are faced with countless hours of strategic planning, phone calls, meetings, emails, and more — and when you add in additional factors, like being a minority business owner, it can make the startup process more difficult.
According to the 2018 Annual Business Survey, out of the total number of businesses in 2017, there were:
23.9% Asian-owned businesses
6.1% veteran-owned businesses
5.6% Latinx (Hispanic-owned) businesses
2.2% Black or African American-owned businesses
The difference in owner demographics is substantial, which is why it is important to continue increasing diversity in the workplace. Even though the number of underrepresented business owners continues to grow, these individuals may still find themselves facing more obstacles than the average business owner. Listed throughout this article are various resources minority business owners can utilize to help level the playing field.
Funding for Minority-Owned Businesses
The exact costs of starting a business vary based on the business type. However, there are specific costs associated with startups that most business owners should expect. The most common business start-up costs that prospective small business owners should prepare for include such expenses as equipment ($10,000-$125,000), incorporation fees (under $300), and office space ($100 to $1,000 per employee per month).
Costs are sure to add up fast — so how do you pay for them when you’re in a tough spot financially? Luckily there are various angel funds, loans, and grants that minority business owners can apply for.
Other Financial Resources for Minority-Owned Startups
Listed below are different angel, seed, and venture capital resources that those from an underrepresented community may be eligible for.
AfroBytes
This company provides opportunities for small business owners who are seeking to connect with investors, business partners, and customers. They also help startups gain more media exposure and provide them with mentoring opportunities.
Aspen Capital Fund
This fund helps to connect Latinx-owned startups and existing small businesses with investors and other capital resources.
Backstage Crowd
This organization invests in companies led by underrepresented founders.
National Minority Supplier Development Council
This council provides small business owners with assistance reaching out to and connecting with corporate members.
SBIR/STTR
The Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) are programs designed to “encourage domestic small businesses to engage in Federal Research/Research and Development with the potential for commercialization."
Unshackled Ventures
This is a company established by immigrants, for immigrants. Their mission is to provide immigrant business owners with leads to investment opportunities and further business support.
Grants and Accelerators for Minority-Owned Businesses
A small business grant is “money that is given to a person, business, or corporation from federal, state, county, or local governments or private businesses or corporations.” Unlike business loans, business grants do not require repayment.
A business accelerator is “a program that gives developing companies access to mentorship, investors, and other support that help them become stable, self-sufficient businesses.”
Here are a few examples of grant and accelerator programs available to those starting their own business:
SoGal Black Founder Startup Grant
SoGal has teamed up with multiple sponsors to provide award winners — Black women or nonbinary entrepreneurs — with $5,000 and $10,000 worth of grants.To qualify for a grant, applicants must:
Have a legally registered business
Have a scalable, high-impact solution or idea with the ambition to be the next billion-dollar business
Plan to seek investor financing in order to scale
Self-identify as a Black woman or Black non-binary entrepreneur
Glossier
This skincare and makeup company has dedicated itself to helping pave the way for Black female entrepreneurs by awarding $500,000 in grants to Black-owned businesses. To apply for the Glossier grant, applicants must write a message explaining the following:
“How [their] business aspires to broaden the conversation about beauty and lead with purpose”
“How [their] business shows up in the beauty space and what sets it apart from others”
“[Their] business’s plan for growth and how this grant will help it get there”
Manos Accelerator
This is an accelerator program available for Latinx business builders that aims to “provide ‘hands-on’ expertise in the areas of product development, design and user experience, customer acquisition, business metrics, and pitch preparation through [a] 12-week mentorship and investor [program].”
Minority Business Development Agency (MBDA)
There are multiple grants applicants can apply for through the MBDA, including the Entrepreneurship Education for Formerly Incarcerated Persons, MBDA Enterprising Women of Color Business Center, and Inner City Innovation Hubs grants.
Poise Bounce Back Grant
This grant was created to help women entrepreneurs “bounce back from financial hardships.” They offer individual and microgrants ranging from $2,500 to $15,000.
SheaMoisture Fund
Through its grants, the SheaMoisture Fund “intends to show the power of small/Black-owned businesses to help communities, while also hoping to minimize the financial disruptions that many are experiencing from the current global crisis.” Eligible applicants can apply for the Black Business Relief Fund, Unsung Business Fund, or the Women of Color E-Lab.
Small Business Loans for Minorities
Individuals who are in need of further financial assistance may be eligible to apply for the following small business loans for minority business owners:
Accion: Loan amounts awarded by Accion vary with each business’s needs, and loans range from $300 to $250,000. Prospective applicants must first qualify before filling out the loan application. Accion provides loans for the following business types:
Those owned by people with disabilities
Food and beverage
Green businesses
Minority-owned
Small businesses
Startups
Veteran-owned
Women-owned
Asian Women Giving Circle: This volunteer-based group pools its resources together to fund projects led by Asian-American women artists. To apply for the Asian-American Women Giving Circle grant, fill out the corresponding application before the application cycle ends in January.
Kabbage: Kabbage funding “provides small business funding designed to help you grow your business on your terms.”
OnDeck: Loan applicants can choose to apply for either a term loan ($5,000 to $250,000) or a line of credit ($6,000 to $100,000). Minimum eligibility requirements include:
Business annual revenue of a minimum of $100,000
Minimum of one year in business
Personal FICO score of 600 or higher
An open business bank account
Opportunity Fund: If approved, applicants for the Opportunity Fund will receive a loan ranging from $2,600 to $250,000.
SBA7(a) Loans: This loan program is the SBA’s “primary program for providing financial assistance to small businesses.” The loan amount varies based on the type of loan applied for, for example:
SBA Microloan Program: This program “provides loans up to $50,000 to help small businesses and certain not-for-profit childcare centers start up and expand.”
Networking Opportunities for Minority Entrepreneurs
Expanding your social network is beneficial for your business for multiple reasons. For example, social networking:
Creates new business opportunities
Develops long-lasting relationships
Improves your creative intellect
Is an avenue to exchange ideas
Makes you noticeable
Below are a few ways business owners of underrepresented communities can expand their social networks.
Conferences, Workshops, and Seminars for Minority Business Owners
Conferences, seminars, and workshops are a great way for individuals to meet up with those with similar interests and discuss business tactics. These seminars and conferences help to educate and provide new business owners with the tools they need to help run a successful business. A few of these workshops specifically for minority business owners include:
Asian American Economic Development Enterprises: This organization is dedicated to helping Asian American entrepreneurs obtain financial security. They provide training and employment services to thousands of Asian Americans with the help of various government groups, nonprofit organizations, and major corporations.
Blacks Network: This is a one-stop-shop for Black business owners to engage in social networking, promote their brands, create funding campaigns, and post new jobs.
National Hispanic Business Group: This group is “dedicated to expanding, promoting, and creating business opportunities for its members by strategically fostering dialogue and economic exchange, while supporting positive social change and community empowerment.”
National Minority Business Council: This non-profit 501(c)(3) corporation is dedicated to providing professional assistance via educational seminars to businesses across the nation.
National Minority Supplier Development Council: This council offers in-person and online opportunities for “certified minority business enterprises and connects them to corporate members.”
StartOut: This organization’s mission is to “increase the number, diversity, and impact of LGBTQ+ entrepreneurs and amplify their stories to drive the economic empowerment of the community.” They achieve this mission by offering mentorship and investor programs.
National Women’s Business Conference: This is held by the National Association of Women Business Owners. Here, multiple keynote and amateur speakers discuss what it is like to be a woman entrepreneur.
Online Professional Communities for Minorities
Online communities allow minority groups to instantly access an abundance of resources at any time of the day. This isn’t the only benefit of an online professional community — they also provide an avenue for new business owners to reach out to others who have experienced or are currently experiencing the same struggles. Here are examples of online communities that are available for minority business professionals:
Hispanic Alliance for Career Enhancement (HACE): HACE is a non-profit organization that is dedicated to “the employment, development, and advancement of current and aspiring Latino professionals.” Individuals can utilize one of the various online programs or enroll in a virtual event to help them learn more about leadership as a Latinx business owner.
Minority Enterprise Development Corp. (FLMEDC): FLMEDC is an online group that focuses on the growth of minority-owned businesses. They offer underrepresented entrepreneurs the support and insight they need to succeed.
Minority Business Mentorship Opportunities
Even if the business owner feels they already know everything there is to know about their specific industry, it is still important to be involved with a mentorship program of some kind — whether it's for themselves or to mentor others. Listed below are just a few of the many mentorship opportunities startups can look into for guidance:
Launch Chat Services: Launch Chat offers a sense of community for like-minded entrepreneurs who need an avenue to discuss new products, find work, get/provide feedback, and find business partners.
Score: Entrepreneurs can find a mentor whenever they need advice on how to survive and thrive through any business-related crisis.
Minority-Owned Business Certifications
A business certification is “an official document that eligible enterprises can apply for…[leading] to benefits like increased recognition, limited business competition, preferential treatment, set-aside contracts, and increased revenue.” Becoming certified isn’t required as a small business, however, doing so can be extremely helpful for multiple reasons. Not only does it open up marketing opportunities, but becoming certified as a minority-owned business can:
Help you gain access to government contracts;
Help you land contracts that once seemed unlikely;
Provide you with a sense of community;
Set your business apart from other businesses.
How to Become Certified
To become certified as a minority-owned small business, business owners must complete the following steps:
Step One: Gather any necessary documents including, but not limited to:
Any historic documents associated with the business;
Business cards;
Bylaws;
Ownership agreements;
Proof of general liability insurance and bonding;
Stock certificates.
Step Two: Register for the National Minority Supplier Development Council.
Step Three: Select an accredited organization that offers certifications and follow their application processes.
Accredited Organizations that Offer Certifications
Here is a list of a few accredited organizations that minority business owners can apply to to earn their certification:
Leadership and Management Resources
Numerous qualities make up a great leader — for example, communicating effectively, showing empathy, being influential, and showing gratitude for their employees. A few ways to become a better business leader are as follows:
Assess how others perceive you;
Be humble;
Continue your education;
Don’t be afraid to implement new ways to better your business, such as using technology to delegate more effectively;
Inspire others to follow you because they want to, not because they have to;
Understand that everyone will have their imperfections;
Work with your team, not just over them.
Training Resources
The following resources provide training courses for business owners, educating them on ways to implement a safe and well-organized workplace:
Center for Social Justice: This center offers various training programs in the following categories:
Bullying and sexual harassment
Cultural competence
Diversity
Minority leadership
Safety, bias, and LGBTQ+ issues
Social justice
Women leadership
Institute for Corporate Productivity (I4CP): This institute aids HR departments and business owners with capitalizing on emerging workforce trends. I4CP provides “insights that help organizations better anticipate, adapt, and act in a constantly changing business environment.”
Interaction Associates: This organization provides business leaders with “practical, simple, and effective programs, tools, and techniques for working better across functions, viewpoints, and geographies.”
Human Resources and Employee Recruitment Resources
Having a human resources (HR) department can help with internal processes that may be difficult for one person to juggle alone. For instance, an HR department can:
Act as a center for conflict management;
Build a workplace culture;
Help with the hiring and training process;
Help with the integration of new workplace processes, including in their own department, such as an HR digital transformation;
Inspire and motivate employees to follow company policies.
HR can also help create a more diverse workplace by hiring individuals of various demographics. The following resources are available to help ensure you and your HR department handle the recruitment process in a professional and effective way:
Other sources include:
Existing professional networks
HR blogs
Job boards and recruiting websites
Professional recruiting firms
Resources to Support and Grow Your Minority-Owned Business
Listed below are additional resources not mentioned above that minority business owners can benefit from.
Accounting Resources
Accounting can be a subject that, if not mastered, can be difficult to manage. Luckily there are resources available, like the ones listed below, that have been created to assist those who need help.
Marketing and Promotional Resources
Marketing and promoting your business is essential if you wish to grow your customer/client base. The following programs can help with digital content creation, social media planning, and content organization for your small business.
How to Embrace Digital Transformation in Your Small Business
Every successful business has the ability to integrate technology and automation in the workplace. Doing so allows you to gain a one-up on your competition and keep up with industry trends.
Digitally transforming your small business can be done in a variety of ways. For instance, you can:
Embrace the cloud
Increase your cybersecurity efforts
Invest in business intelligence such as digital apps and analytics
Reevaluate your current technological infrastructure
Refer back to the Minority Business and Technology Initiative (MBTI) for assistance in implementing technological approaches in the workplace
Additional Resources and Further Reading
Minority business owners may also find the following resources to be useful during their startup journey.
Asian Nation Small Businesses and Self-Employment: This is an online resource that provides Asian small business owners with multiple blog posts, links, books, and historic facts on what it is like to be an Asian American entrepreneur.
League of United Latin American Citizens (LULAC) : The LULAC helps “advance the economic condition, educational attainment, political influence, housing, health, and civil rights of the Hispanic population of the United States.”
National Women’s Business Council (NWBC) : Created under Title IV, the NWBC is a federal advisory committee that serves as an “independent source of advice and policy recommendations to the President, the U.S. Congress, and to the Administrator of the U.S. Small Business Administration on issues of importance to women business owners and entrepreneurs.”
U.S. Hispanic Chamber of Commerce (USHCC) : USHCC is a section of the Chamber of Commerce that “promotes the economic growth, development, and interests of more than 4.7 million Hispanic-owned businesses...and advocates on behalf of 260 major American corporations.”
