3 Reasons Black Professionals Should Invest in Black-owned Businesses and Founders!

Bill HustonAlternative Finance, Community Capital, Crowd Investing


Small business ownership and entrepreneurship have been longtime wealth builders for Americans, but there have always been systemic barriers in place to prevent Black Americans from taking full advantage of these proven wealth-building staples. The systemic barriers have resulted in an immense racial wealth gap. The advent of investment crowdfunding supporting Black-owned businesses and entrepreneurs through direct small-dollar investments adds another dynamic to supporting Black Businesses by providing access to capital to these businesses.  

Creates Jobs and Opportunities

When Black-owned businesses are in high demand, the companies are more profitable. Showing your support helps contribute to creating entrepreneurial opportunities. Black entrepreneurship can fuel the Black community’s economic prosperity and serve as a bridge where low-income families can move up to middle-class status. The reality is that there aren’t enough black-owned businesses to hire unemployed Black people. Time is overdue for change, and we must pool our resources and build our own reality.

Closes the Racial Wealth Gap

The persistent racial wealth gap in the United States is a burden on Black Americans as well as the overall economy. It can be traced back to the Jim Crow era and redlining that prevented Black people from accessing higher-paying jobs and homeownership opportunities. According to the Federal Reserve Bank of Cleveland, In 2016, the average wealth of households with a head identifying as black was $140,000, while for white-headed households was $901,000, nearly 6.5 times greater.” Support of black businesses can increase the flow of wealth to black families and black communities. This helps to close off the racial wealth gap over time.

Strengthens Black Communities Economically 

There are currently 2.6 million black-owned businesses in America, where 8 out of 10 fail within their first 18 months due to the lack of resources and funds. According to The State of Working America, “Black people spend four percent more money annually than any other race although they are the least represented race and the race that lives in poverty at the highest rate.” It would be more beneficial if more money was recycled within the black community investment crowdfunding adds a new wealth-building dynamic. More importantly, it would generate more wealth within the community pillars. 

Empower Local Communities

The power of the community has paved the way for many business owners and investment crowdfunding data demonstrates its ability to increase revenue for businesses that have successfully crowdfunded. When you choose to support Black-owned businesses, you’re supporting Black of pride, unity, and self-determination. Black entrepreneurship is a tool for survival in a world that does not want to see you win. When we choose to win against all odds, young black children grow up seeing successful entrepreneurs and a thriving community. Investment crowdfunding requires a huge social media push to put dollars directly back in Black business owners’ hands.  

Key Takeaways 

By supporting more Black-owned companies through investment and commerce, the Black community can help create more opportunities for meaningful savings, property ownership, credit building, and generational wealth for Black communities. If we all do our part in supporting Black businesses, then we’re helping with the progression of strengthening many black communities. Supporting black businesses shouldn’t be a trend; it should be a lifestyle. To learn more about investment crowdfunding and how to support and engage the Black business community on a single platform visit The American Dream Marketplace!