Report offers ways to address inequities among Philly’s minority-owned small businesses
A new report offers recommendations for addressing the barriers faced by businesses owned by people of color and building a more equitable entrepreneurship ecosystem.
The report, titled Philadelphia Equitable Entrepreneurship Ecosystem Assessment and Strategy, builds on existing investments by the city, United Way of Greater Philadelphia and Southern New Jersey and PIDC in enhancing Philadelphia’s entrepreneurial landscape. The work was supported by researchers from Urbane, Next Street, Econsult Solutions, Inc. and SourceLink.
The research incorporates feedback from interviews, focus groups and survey responses from nearly 250 small business owners and 79 capital and business support organizations and an advisory council of more than 30 local business owners, community-based organizations, capital and service providers, city government officials and philanthropic institutions.
Solutions highlighted in the report fall into four key areas: access to capital, market opportunities, trusted services and ecosystem infrastructure.
Recommendations for improving access to capital include creating capital pools for place-based investments and forming new “friends and family” pre-seed and seed funds for pre-venture and early-stage minority entrepreneurs.
Proposed recommendations to increase market opportunities include integrating supplier diversity initiatives across the city government, anchor institutions and large corporations and establishing industry-specific business accelerators.
Solutions for providing trusted guidance include creating a network of trusted pro-bono consultants that provide tailored one-on-one support for BIPOC (Black Indigenous and People of Color) entrepreneurs and creating an online resource navigator for local small businesses to identify and access needed services.
To build ecosystem infrastructure, the report calls for the formation of a collaboration of funders dedicated to support equitable small businesses and capacity building programs for local capital and service providers to be established.
Officials said collaborative funding strategies are being pursued to develop these solutions.
James Johnson-Piett, principal and founder of Urbane, a social-impact strategy and development firm, said the report addressed the importance of having a central resource for business owners.
“As a business owner, one of the trickiest things in general in Philadelphia was figuring out how to help where the resources are to help my business grow or quite frankly survive when I’m having problems or issues,” he said.
“There (are) a lot of opportunities and a lot of resources but they are all over the place and having some central place to be able to go, is hugely important – especially during times of crisis and we saw it during COVID.”
He noted that many business owners didn’t know how to access resources set up to help businesses navigate financially through the pandemic.
“I felt that as a business owner during COVID. For PPP (Paycheck Protection Program) purposes, I was lucky because I had a network of folks that knew where to go and how to maneuver, but I knew plenty of businesses where I acted as a conduit,” said Johnson-Piett, a key member of the report’s research team.
“I can think of thousands of businesses who just didn’t know what to do when all of this started happening. The sad thing was there was so much opportunity to get resources from the federal government and local government right on down, in those first couple of months it was really tough watching folks not know how to maneuver.”
“So I think the report definitely told that story, shone a light on those issues but also can speak to some of the solutions to sort of get that right,” he continued.
Michael Banks, managing director, Employment, Opportunity & Entrepreneurship at United Way said the pandemic highlighted just how fragmented the city’s ecosystem was for entrepreneurs of color.
“When you look at a situation like COVID, which is very unfortunate, it highlighted just how fractured this system was and just how sensitive this particular group of entrepreneurs were to the market,” he said.
“They were trying to get by on shoestring budget for years without being able to access different types of capital or different types of investment or financial vehicles and as a result they were closing at a disproportionately higher rate than their peers.”
“So what you have seen in Philadelphia is just years and years of people not paying attention to the state of BIPOC entrepreneurs and not aligning the resources correctly,” Banks said.
He said having an accessible, well-connected ecosystem for entrepreneurs is one of the biggest takeaways from the report.
“I think that there is also an opportunity for us to bring new resources and solutions to the table,” Banks added.
“I think that we have a lot of great business service organizations in the city of Philadelphia but I think there is room for folks to come in and fill some of gaps that we have identified within the report as it relates to the different types of businesses that are coming online.”
Philadelphia Commerce Director Michael Rashid said after several years of strong economic growth in Philadelphia, the pandemic and resulting economic crisis have presented an unprecedented challenge of local businesses, especially minority-owned businesses.
“As we work to drive an inclusive recovery in the wake of the pandemic, this initiative and the recommendations from this assessment represent a major step forward in elevating opportunities for people of color, women, and immigrants who are underrepresented in the Philadelphia business community,” he said in a news release.
“We’re greatly appreciative of the work of the research firms and our economic development partners as we seek to implement solutions to break down the barriers that inhibit the growth of businesses from historically disadvantaged backgrounds.”
Originally published at www.penncapital-star.com,by Special to the Capital-Star