As the statistics indicate, 50% of all businesses fail in the first five years of their origin. One encounters several challenges when starting a new business. If you’re an entrepreneur of color, you need to buckle up for more than the usual share of roadblocks. Though every entrepreneur deserves a fair shot at success, the reality is far from it.
In an ideal world, the only determinants of a successful startup should be the owner’s innovation and the employees’ hard work. However, the game’s rules seem to be working against entrepreneurs of color. Black, Native American, Latinx, and other minority groups are significantly less wealthy than their white counterparts. Consequently, they possess a lesser amount of capital to channel into their business and less surety to offer against outside creditors’ debts.
Fortunately, you can conquer these hurdles with preemptive strategies, perseverance, and a little luck! In fact, there are tons of inspirational success stories of minority entrepreneurs overcoming these problems and developing booming businesses.
Below, we will go over some valuable tips on how to succeed as a POC entrepreneur. Furthermore, we will talk about a few strengths exclusive to people of color and how you can harness them to gain a footing in the market.
1. Get Your Finances In Order
Let’s assume you’re a Black, Latinx, or Asian entrepreneur and lack access to sufficient funds for the business. If that’s the case, you must create a detailed financial plan before taking any further entrepreneurial steps. Organized and orderly finances provide an insight into your business’ total worth, profits or losses, and debts. You’ll be less intimidated by accounting if you make your company’s income statement, balance sheet, and cash flow statement your acquaintances. As a result, your business will be able to survive without the expensive help of a professional accountant.
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Moreover, it would help if you studied the past and future trends in the securities and stock market for your business type. There’s no scarcity of helpful resources and tools on the internet; take your pick. A good starting point for POC entrepreneurs could be learning about their communities’ wealth generation, accumulation, and circulation patterns. If that’s something you’re interested in, you should check out Greenwood post to recirculation of wealth in black community. It will help you gain some fruitful insights.
2. Venture Beyond Traditional Capital
Entrepreneurs, especially POC entrepreneurs, don’t have adequate access to generational wealth or other investment sources that enable a business to stand on its two feet.
Without the ready cash flow, an entrepreneur must put their creativity and resourcefulness to use. Indeed, raising monetary capital is crucial to business, but investing in and growing human capital, including yourself, is just as important. Try to learn some skills that can be easily self-taught and save you valuable dollars on startup expenses. These skills can range from fundamentals of marketing, website design, business communication, and budgeting, among others.
Also, try acquiring support from people in your circle and employ relevant knowledge and expertise to grow your business. There’s no harm in negotiating or bargaining for an expense you can’t avoid.
3. Have Faith In Your Dreams
Have you ever heard the clichéd phrase “Dreams don’t work unless you do”? Well, it turns out that this fancy jargon has some truth to it. Often, small businesses progress because their owners view failure as a driving force for success. It’s intrinsic in human nature to feel discouraged after seeing your efforts bearing no fruit. Yet, you shouldn’t measure your progress only on scales of profitability, visibility, or tangibility. Even if you feel like your hard work leads you nowhere, you need to practice patience if you want to realize your dreams.
The economy is in constant flux; no boom or recession persists for long. Perhaps, your demands are down, and your customers might not be interested in buying for the time being, but there is always tomorrow. Maintain contact with all your leads and previous clients through different marketing channels and campaigns. For instance, interactive social media and email marketing have a lasting effect on your customer’s mind and result in better conversion rates and profits.
4. Focus On Building A Network
Usually, a tight-knit community and good networking skills can compensate for the meager capital funds. Suppose you’re low on cash for advertising of your new startup. In that case, close, well-established contacts may be agreeing to market your brand for you and even land you some potential buyers. Get in touch with market professionals, ask for recommendations, and be courteous towards your industry competitors.
Another great approach is to get affiliated with the Chamber of Commerce in your region. With a little nudging, they may give you a list of potential clientele or refer you to professional networks in the area.
Building a reliable network helps put your brand out there in the public eye. Attending networking events and creating a substantial social media presence for your business are surefire ways to earn higher profits and grow business.
5. Seek Mentorship Opportunities
Our modern world’s real tragedy is how ethnicity bias still plays a significant role in a POC entrepreneur’s success and overall earnings. Minority groups tend to pursue higher education at a higher rate than everyone else. Regardless, they still require mentorship and training to steer through the trials of getting a business up and running.
People of color usually have restricted access to respected networks and high-value information. Such access is often a make-or-break factor in a business’ growth. Mentorship can supplement a POC entrepreneur’s success as it helps combat inequalities in the markets and provides them a framework to work their way up the corporate ladder.
6. Set Clear Boundaries In Your Dealings
In the initial stages of a startup, you may get strung up in the optimism of something new on the horizon. Yet, it doesn’t take long for reality to settle in. Quarrels with customers, creditors, and suppliers are an inevitable part of a business owner’s life and can sometimes take serious turns.
You can generate more profits if you effectively convey your expectations and set boundaries with your business stakeholders. Let no one take advantage of your position. To maintain your business’s growth trajectory, you must learn how to persuade creditors for additional funds and brace for some hard-hitting conversations with your investors. This clarity in your expectations and communication will help you in administrative decision-making and help your subordinates be a better team player.
To Sum It Up
Entrepreneurs, especially those belonging to the specific minority and ethnic groups, face tremendous challenges in achieving their business goals. Along with the tips mentioned above, programs, policies, organizations, and bounded geography also shape a business’s environment and growth. Government institutions should also ensure that these factors interact harmoniously to provide welcoming spaces for ambitious entrepreneurs, regardless of their socio-economic background and ethnicity.