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Financing Black Businesses in Canada and USA: Challenges and Opportunities
What are the experiences of Black entrepreneurs in securing financing for their businesses and what role may alternative financing options (beyond financial institutions) in supporting the development and growth of Black enterprises?
Access to capital is a major challenge for entrepreneurs of all backgrounds, but studies have shown that Black business owners in particular have historically face significant obstacles in obtaining financing for their businesses. This is due to systemic racism, discrimination and lack of access to traditional financial institutions. Despite these challenges, alternative financing options are available for Black entrepreneurs that can support the development and growth of their businesses.
According to a report by the National Black Chamber of Commerce, Black-owned businesses are less likely to be approved for loans than non-Black-owned businesses, and when they are approved, they often receive smaller loans at higher interest rates. This lack of access to traditional forms of financing has led many Black entrepreneurs to seek alternative financing options to support the development and growth of their businesses.
The Challenges Facing Black Entrepreneurs

A recent report from the Federal Reserve Bank of New York found that Black-owned businesses are less likely to receive loan approval than non-Black owned businesses. This is due to a combination of factors such as systemic racism, discrimination by lenders, and lack of access to traditional financial institutions (such as banks). Additionally, even when loans are provided to Black business owners, they tend to be smaller than those given to non-Black business owners.
Moreover, Black entrepreneurs tend not to have access to the same networks or resources as other entrepreneurs. These networks may include mentorships or incubator programs that can provide valuable advice and guidance on how best to manage finances or secure additional capital. Without these networks and resources, it becomes more difficult for Black entrepreneurs to secure financing for their businesses.
One alternative financing option that has gained popularity in recent years is crowdfunding. Crowdfunding allows businesses to raise funds from a large number of individuals, typically via the internet. This can be a particularly attractive option for Black entrepreneurs, as it allows them to bypass traditional financial institutions that may be less likely to lend to them. Additionally, crowdfunding can also be a way for Black entrepreneurs to build a community of supporters and customers around their business, which can be beneficial for long-term growth.
Another alternative financing option that has been gaining traction is community investing. Community investing allows individuals to invest in businesses that are located in their own communities, and can be a way for Black entrepreneurs to access capital from people who are more likely to understand and support their businesses. Community investing can also be a way for Black entrepreneurs to build relationships with local investors and stakeholders, which can be beneficial for long-term growth.
Microfinance is also a popular alternative financing option for Black entrepreneurs. Microfinance institutions provide small loans, savings, and insurance to low-income individuals and micro-businesses, which can be particularly beneficial for Black entrepreneurs who may not have access to traditional forms of financing. Microfinance can also be a way for Black entrepreneurs to build relationships with local financial institutions and access additional resources to support the development and growth of their businesses.
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The Role of Government Agencies & Community Organizations
Government agencies such as the Small Business Administration (SBA) also play an important role in supporting the development and growth of minority-owned businesses. Through its Office of Minority Business Development (OMBD), the SBA offers resources such as business counseling services, technical assistance programs, mentoring opportunities, and more — all designed to help small business owners gain access to capital and advice on how best to manage their operations. There are also numerous community organizations across the country dedicated solely to helping Black entrepreneurs secure financing for their businesses—many through innovative partnerships with local banks and other financial institutions—to ensure access to capital regardless of race or ethnicity.
Financing Black Businesses in Canada and USA: Challenges and Opportunities – Conclusion
In conclusion, Black entrepreneurs have historically faced significant barriers in securing financing for their businesses. However, alternative financing options such as crowdfunding, community investing, and microfinance can provide Black entrepreneurs with access to capital and support for the development and growth of their businesses. It is important that we continue to support and invest in these alternative financing options to ensure that Black entrepreneurs have the resources they need to succeed.
Articles in this blog post have discussed why securing financing is often difficult for black-owned businesses due systemic racism and oppression in banking industry, some alternative sources available, and the importance /role played by government agencies/community organizations. It is evident that there is still much work that needs to be done in order for these disparities between white-owned businesses versus black-owned ones in terms of access to capital/financing. Alternative finance sources as well as government programs need increased investment so that Black owned business can get necessary funding required for them take off. We can only hope with time these issues will be addressed properly. Bring together all stakeholders including public sectors, private sectors, financial institutions and black entrepreneurship communities – we must work together create a robust ecosystem enables equitable access and opportunity needed help our local economies becoming strong and vibrant.
Examining the Fragmented Data on Black Entrepreneurship in North America
Resources about Black Entrepreneurs in USA and Canada:
- Black Entrepreneurship Knowledge Hub (BEKH) is a key part of the Government of
Canada’s Black Entrepreneurship Program. - FACE
National Ecosystem Fund
- Minister Ng announces the launch of the Black Entrepreneurship Loan Fund
- Prime Minister announces support for Black entrepreneurs and business owners
- Tender opportunities for Canadian Black owned or led small businesses
- Building a Foundation for Change: Canada’s Anti-Racism Strategy 2019–2022
- Support for Community Organizations Helping Canadians
- https://www.supportblackowned.com/
- https://en.wikipedia.org/wiki/Black_Entrepreneurs_Day
- https://www.rbcroyalbank.com/business/advice/blackentrepreneur.html
- https://www.futurpreneur.ca/en/besp-rbc
- https://startup.google.com/blackfoundersfund
- Defining Black Entrepreneurs: How do we define Black entrepreneurs, Black enterprises, and Black entrepreneurship? Black entrepreneurs are individuals who own and operate businesses that are either majority-owned or controlled by Black people. Black enterprises are businesses that are majority-owned or controlled by Black people. Black entrepreneurship refers to the process of starting, organizing, managing, and assuming the risks of a business venture that is majority-owned or controlled by Black people. It encompasses all aspects of creating, building, and running a business, including identifying opportunities, securing funding, and creating a sustainable business model.
- Inspiring policy makers to create change: How can research on Black entrepreneurship inspire policy makers to create change that are supportive of Black entrepreneurs?
- The role of community, culture, and ecosystems: What role does community culture, Black entrepreneurship culture, and entrepreneurial ecosystems play in fostering and strengthening Black entrepreneurship in Canada?
- Black businesses’ growth and success: How may Black entrepreneurs grow and sustain their business over the longer term?
- Understanding the Black immigrant entrepreneur: What are the experiences of Black immigrant entrepreneurs and how do these experiences differ from Black entrepreneurs born in Canada?
Support Books and Business owned by Black Authors and Entrepreneurs in USA and Canada:
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List of Freely available programming books - What is the single most influential book every Programmers should read
- Bjarne Stroustrup - The C++ Programming Language
- Brian W. Kernighan, Rob Pike - The Practice of Programming
- Donald Knuth - The Art of Computer Programming
- Ellen Ullman - Close to the Machine
- Ellis Horowitz - Fundamentals of Computer Algorithms
- Eric Raymond - The Art of Unix Programming
- Gerald M. Weinberg - The Psychology of Computer Programming
- James Gosling - The Java Programming Language
- Joel Spolsky - The Best Software Writing I
- Keith Curtis - After the Software Wars
- Richard M. Stallman - Free Software, Free Society
- Richard P. Gabriel - Patterns of Software
- Richard P. Gabriel - Innovation Happens Elsewhere
- Code Complete (2nd edition) by Steve McConnell
- The Pragmatic Programmer
- Structure and Interpretation of Computer Programs
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- Refactoring: Improving the Design of Existing Code
- The Mythical Man Month
- The Art of Computer Programming by Donald Knuth
- Compilers: Principles, Techniques and Tools by Alfred V. Aho, Ravi Sethi and Jeffrey D. Ullman
- Gödel, Escher, Bach by Douglas Hofstadter
- Clean Code: A Handbook of Agile Software Craftsmanship by Robert C. Martin
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- Effective Java 2nd edition
- Patterns of Enterprise Application Architecture by Martin Fowler
- The Little Schemer
- The Seasoned Schemer
- Why's (Poignant) Guide to Ruby
- The Inmates Are Running The Asylum: Why High Tech Products Drive Us Crazy and How to Restore the Sanity
- The Art of Unix Programming
- Test-Driven Development: By Example by Kent Beck
- Practices of an Agile Developer
- Don't Make Me Think
- Agile Software Development, Principles, Patterns, and Practices by Robert C. Martin
- Domain Driven Designs by Eric Evans
- The Design of Everyday Things by Donald Norman
- Modern C++ Design by Andrei Alexandrescu
- Best Software Writing I by Joel Spolsky
- The Practice of Programming by Kernighan and Pike
- Pragmatic Thinking and Learning: Refactor Your Wetware by Andy Hunt
- Software Estimation: Demystifying the Black Art by Steve McConnel
- The Passionate Programmer (My Job Went To India) by Chad Fowler
- Hackers: Heroes of the Computer Revolution
- Algorithms + Data Structures = Programs
- Writing Solid Code
- JavaScript - The Good Parts
- Getting Real by 37 Signals
- Foundations of Programming by Karl Seguin
- Computer Graphics: Principles and Practice in C (2nd Edition)
- Thinking in Java by Bruce Eckel
- The Elements of Computing Systems
- Refactoring to Patterns by Joshua Kerievsky
- Modern Operating Systems by Andrew S. Tanenbaum
- The Annotated Turing
- Things That Make Us Smart by Donald Norman
- The Timeless Way of Building by Christopher Alexander
- The Deadline: A Novel About Project Management by Tom DeMarco
- The C++ Programming Language (3rd edition) by Stroustrup
- Patterns of Enterprise Application Architecture
- Computer Systems - A Programmer's Perspective
- Agile Principles, Patterns, and Practices in C# by Robert C. Martin
- Growing Object-Oriented Software, Guided by Tests
- Framework Design Guidelines by Brad Abrams
- Object Thinking by Dr. David West
- Advanced Programming in the UNIX Environment by W. Richard Stevens
- Hackers and Painters: Big Ideas from the Computer Age
- The Soul of a New Machine by Tracy Kidder
- CLR via C# by Jeffrey Richter
- The Timeless Way of Building by Christopher Alexander
- Design Patterns in C# by Steve Metsker
- Alice in Wonderland by Lewis Carol
- Zen and the Art of Motorcycle Maintenance by Robert M. Pirsig
- About Face - The Essentials of Interaction Design
- Here Comes Everybody: The Power of Organizing Without Organizations by Clay Shirky
- The Tao of Programming
- Computational Beauty of Nature
- Writing Solid Code by Steve Maguire
- Philip and Alex's Guide to Web Publishing
- Object-Oriented Analysis and Design with Applications by Grady Booch
- Effective Java by Joshua Bloch
- Computability by N. J. Cutland
- Masterminds of Programming
- The Tao Te Ching
- The Productive Programmer
- The Art of Deception by Kevin Mitnick
- The Career Programmer: Guerilla Tactics for an Imperfect World by Christopher Duncan
- Paradigms of Artificial Intelligence Programming: Case studies in Common Lisp
- Masters of Doom
- Pragmatic Unit Testing in C# with NUnit by Andy Hunt and Dave Thomas with Matt Hargett
- How To Solve It by George Polya
- The Alchemist by Paulo Coelho
- Smalltalk-80: The Language and its Implementation
- Writing Secure Code (2nd Edition) by Michael Howard
- Introduction to Functional Programming by Philip Wadler and Richard Bird
- No Bugs! by David Thielen
- Rework by Jason Freid and DHH
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