Women Entrepreneurs of Color Share Biggest Business Hurdles
Before you can succeed in business, you have to remind yourself who you are and that you deserve to be there.
By Xintian Tina Wang
More often than not, Black women entrepreneurs in America have felt the impact of their skin color acutely — and it’s not always a good feeling.
In a recent survey of 1,000 U.S. entrepreneurs, almost a third of women of color reported having had a negative experience in entrepreneurship as a result of their race. While the May survey, from software platform Thinkific and market research company OnePoll, didn’t get into details as to what qualifies as a “negative experience,” likely the same headwinds persist for underrepresented founders.
“Being a businesswoman of color will come with setbacks, limitations, and uncertainties,” licensed marriage and family therapist and founder of KW Couples Therapy Kiaundra Jackson tells Inc. Everything from raising capital to finding vendors and customers to self-doubt are often intractable issues for female founders of color, she adds.
In the face of such obstacles, women of color still manage to persevere. Here are three tips for overcoming some of the biggest challenges women of color face in entrepreneurship.
1. Get your financial house in order.
After getting laid off from her corporate job and going through a divorce, Ellie Diep used $1,200 from her pandemic stimulus to launch an online education platform, “Ellie Talks Money,” and generated more than $2 million in revenue last year. Her mission now is focused on supporting women entrepreneurs of color and mom entrepreneurs in their effort to build business credit.
To build credit, women entrepreneurs should set up a formal business entity with, say, a limited liability company, Diep suggests. “The great thing about business credit is that even if a business owner has less than perfect personal credit, they are still able to have access to building business credit because it reports separately,” says Diep. “This is going to help grow their business by giving them access to capital.”
Diep also suggests formalizing your financial procedures as soon possible. Entrepreneurs just starting up often don’t have the proper structure in place — and that can affect everything from a founder’s ability to get a bank loan to getting her company funded. When applying for bank loan and pitching to investors, for instance, she says having organized financial records, good bookkeeping protocols, and a payment processor are vital. Having these proper channels in place can help you more easily distill your financials and project cash flow needs, among other benefits.
2. Take care of your mental health.
One of the biggest things that plague women entrepreneurs of color is imposter syndrome, says Jackson. The phenomenon in which individuals doubt their abilities and achievements is but one of many limiting beliefs that touches this group, she adds.
Jackson suggests taking the time to work out your issues as early as possible in the startup process. Seeking [assistance] from a licensed professional who can help you process any trauma, wrong ideals about money, limiting beliefs about your personhood, and maintaining a healthy relationship with self and others is the best thing you can do before making the first step,” she says. “It [can] help you dodge and manage all the curve balls that will inevitably come your way.”
Another way to beat imposter syndrome is to create a list of everything you are qualified to do, Diep suggests. The list should highlight all your previous experiences and accomplishments and any degrees or skills you have. This list can serve as your go-to resource whenever imposter syndrome starts to whisper in your ear, she says. “I want women of color entrepreneurs to recognize that there’s space for you in the marketplace.” You just have to believe you can do it, Diep adds.
3. Set yourself up for success.
Reflecting on her experiences establishing her online business, Jackson says another factor getting in a female entrepreneur’s way is you. If you think you can’t do it, you won’t, she says. Jackson advises entrepreneurs of color to keep reminding themselves what they can offer, adding that fear will only get in their way.
“You may think ‘What if I fail?’ — but what if you succeed?” Jackson says. “We all know this entrepreneur journey isn’t the easiest. But coming from someone who did not see entrepreneurship modeled in my family, it can be done.”
Diep adds that entrepreneurs can lessen these concerns if they spend ample time on the front-end doing research. Those who are prepared for challenges can develop a strategy necessary for overcoming them, she adds.
Image: Courtesy Subjects