“Gaps in wealth, credit and trust create barriers that are like ‘kryptonite’ to minority business growth,” says Connie Evans, president and CEO, Association of Enterprise Opportunity (AEO).
Evans delivered an informative keynote at the 12th Annual Mid-South Minority Business Council Continuum’s “Power Breakfast” on Wednesday.
The famed entrepreneur spoke before hundreds of small business developers, minority entrepreneurs and corporate leaders participating in the three-day conference opener.
As an international business development consultant and founder of three companies, Evans shared solutions and ideas for small business growth, the key to solving unemployment rates in African- American communities.
“Black business owners are wealthier than non-business owners in the black community,” says Evans.
Her firm, AEO, conducts research, influences policy and promotes innovation for small, minority businesses (companies with 500 or less employees), and is a national trade association for microfinance solutions.
In 2015, AEO was granted a $1M innovation grant to help 8,000 MWBEs declined for small business loans that year. AEO has a goal of raising $77M in three years for its Vision Fund, a tool for helping community development finance institutions (CDFIs) across the nation lend to MWBEs seeking growth and greater contract capacity.
To date, AEO, which is working with three major banks, has $15M in Vision Fund capital and is approved to support CDFIs by the Fed and other bank regulators. AEO can also match MWBEs to CDFIs and business mentors through its matching services.
“Capital loans are very effective in helping MWBEs start and grow. When MWBEs receive the tools they need to grow, they grow 30 percent higher than those without access to capital,” Evans says.
Evans emphasized that capital is not all that is needed at the right size and right fit, but factors that improve inclusion, innovation and investment are just as important.
For example, AEO’s Tapestry Project influences MWBE inclusion by granting $50,000 to 25 competing cities to tackle barriers to collaboration, such as a lack of trust and networking efforts.
Birmingham is one of the recipients – Memphis is preparing to apply.
Evans pointed out that MWBEs create 3.6 million jobs in America and contribute billions to the U.S. economy. Her company’s research shows that full black employment would be reached if 15 percent of sole proprietors would hire just one black employee and 75 percent of all non-sole employee business owners would hire just two black employees.
Memphis Mayor Jim Strickland preceded Evans’ keynote stating that, in 2017, local minority business owners had accumulated only one percent of revenue among all Memphis businesses 25 years prior – and that 25 years later – were still at only one percent.
“That is not sustainable,” said the mayor as he considered the conference theme — Building a Path Forward for Sustainable Growth.
Strickland added that the City of Memphis now conducts 20 percent of its business with minority- and women-owned enterprises (MWBEs) compared to 12 percent prior with the help of Joann Massey, director of the Office of Business Diversity & Compliance.
Strickland concluded by mentioning the city’s directory of businesses including MWBEs that is now available to anyone at www.buy901.net, an easy way to promote local procurement through a quick internet search. He also noted the naming of the city’s minority business service center after Fred Davis in honor of his 50-plus year career as a black business owner.
“Government and private sector agencies, and individuals have to do better,” said Strickland.
(For more information about the Association for Enterprise Opportunities or its president and CEO, Connie Evans, visit https://www.aeoworks.org.)