3 Oct 2021
We love to see startup businesses grow from the initial idea to securing funding, and as part of Black History month, we took a look at resounding successes from Black-owned businesses in the UK. From the types of businesses to funding, we celebrate Black entrepreneurs and explore findings from the Black Report with Google for Startups.
Historically, in the US, Black-owned businesses were set up as a direct response to the lack of opportunity and space available for people of colour at the turn of the 20th century.
More African Americans had the space to become entrepreneurs and hired fellow African Americans, creating instant opportunities for all.
In the UK, many Black-owned businesses came from the Windrush generation post-1948, introducing a more diverse post-war workforce and creating more opportunities for entrepreneurs.
Diversity is essential for the industry in the UK, with this pattern of creating opportunity, also reflected in the UK business market. As of 2020, Black-owned businesses, on average, created 5.4 more job roles for every startup that successfully launched.
Its key is to introduce innovative products and services specifically designed to enhance and even disrupt established sectors such as tech, cosmetics, and even the food industry, bringing a fresh perspective to traditional industries.
Having a representative team is also vital for revitalising the UK business scene.
According to data from the Black Report in partnership with Google for Startups, 48% of Black-owned businesses have female founders, 5% identify themselves as having a disability, and 9% of employees and founders identify as LGBTQIA+.
Actively working in an inclusive environment is one of the critical parts of running a successful business. According to the report, Black-owned companies have a 77% success rate of generating revenue.
It's worth noting that 66% of founders in the survey studied non-STEM degrees, indicating that businesses can be successful without traditional degrees behind them.
In the video, some of the founders share their stories. They talk about where they studied, grew up, and some things that motivated them to start a business.
IIt is vital for businesses in the UK to ensure that ethnic, religious, gender and sexual minorities are represented to help shape the future of industry. A more diverse workforce is a great way to reshape a stale working landscape.
According to the survey the Black Report, the top 5 types of Black-owned businesses are:
18.3% eCommerce and retail
6.67% publishing and software
Having a fresh perspective and entrepreneurial spirit within these traditional sectors is just what the business landscape in the UK needs. Still, it can prove more challenging to get a business off the ground without financial means.
The data tells us that Black founders tend to favour East London when starting a business. Almost half of all Black founders' businesses are based in East London, either in or surrounding the Old Street, an area that has become synonymous with startups.
Comparatively, 13% of Black founders run their startups in West London, 12 in South-East London and 12% run their businesses remotely and work from home.
To mark International Women's Day 2022, BusinessLive showcased female entrepreneurs who started a company after receiving support from the Prince's Trust. Here are three:
1. Sophie Rogers - Vibe Alignment
"As a fully trained yoga and meditation teacher, teaching weekly classes, I continuously want to improve my own mental health and wellbeing, which is the inspiration behind High Vibe Alignment. Hopefully allowing others to do the same!” - Sophie Rogers
2. Isabella Mukasa - Pearl to Coast
“Pearl to Coast is the bridge bridging Organic East African Shea Butter to the UK through a fusion of traditional East African craftsmanship, contemporary design and sustainability." - Isabella Mukasa
3. Nyomi Smith - Sanaa Giftshop
"We need more positive representation of our black kings and queens, and Sanaa Giftshop strides to celebrate and empower black excellence. In Swahili, Sanaa mean ‘work of art’, and I hope through my art, gift wraps, cards, mugs and more, I’m able to highlight a more diverse society." - Nyomi Smith
A staggering 88% of all Black-owned startups surveyed said they had self-funded their business idea without a business loan or help from family and friends when funding their businesses.
One of the biggest stumbling blocks for businesses in the UK is a lack of financial support. The report states Black-owned companies are 4x less likely to apply for funding such as overdrafts, loans or business credit cards to help fund their business initially.
Having to self-fund a business shouldn't have to hold back a great idea, so if you're confident your business can go the distance, it's worth doing some research into the grants, loans or other funding you might be entitled to.
If you're looking to start your business journey and want to find out if you're eligible for a business loan, start your journey with us today.Get in touch today