“The Health of Black Businesses is the Health of Black Communities”

9.28.2021 - LISC Stories

There aren’t many places in America where you can pick up a home-recipe, cooked-to-order chili cheese dog for $3.60, much less a vegan chili cheese dog for an even $6. But the purveyor of this awesome deal, Jordan’s Hot Dogs in South Los Angeles, is a community asset on a whole other level, too.  

Jordan’s is a multi-generational Black-owned business, founded by Alabama-born Oranee Jordan in 1965 and sustained, through thick and thin, by her descendants. Today the Jordan family stands committed to serving up fresh, affordable comfort food for years to come from their location on Crenshaw Boulevard, a commercial and cultural hub of Black LA.   

Communities of color have borne disproportionate burdens in the Covid-19 crisis—an outcome of longstanding, interlocking inequities—and businesses like Jordan’s have suffered right along with them. Yet these key local enterprises can also be a fulcrum for communal recovery.  

To support their resiliency, in June 2020 the Nielsen Foundation committed $1 million to provide Black entrepreneurs with technical assistance and small grants. Through LISC, the money is going to augment the efforts of business development organizations (BDOs) that are connected to Black businesses and based in centers of Black American culture—the Crenshaw district in LA, Bedford-Stuyvesant in Brooklyn, St. Paul’s Rondo neighborhood, and Chicago’s South Shore. 

Cary Jordan Sr., proprietor of Jordan's Hot Dogs, a multi-generational anchor business in L.A.'s Crenshaw District.

The grant covers three years, and in year one some 270 businesses have received help—grants averaging $5,600 to meet expenses in the face of steep revenue declines, or expert advice on how to create new income streams, access capital on flexible terms, or improve business systems. Jordan’s, like many of the businesses, got assistance creating a more robust online presence as customers shrank from exposure to crowded restaurants and other public gatherings.  

It’s a modest boost for individual businesses, but a model LISC’s economic development team has worked hard to amply fund and scale, supporting, in all, more than 130 culturally competent BDOs around the country that advance economic and racial justice by helping local entrepreneurs do their thing, and succeed at it. 

Black businesses matter 

Collective resources in Black communities, including Black-owned businesses, often were created as a kind of workaround to systemic oppression and lack of access, observes Jason Foster, president and COO of Nielsen Foundation grantee Destination Crenshaw, a major infrastructure and economic development initiative that celebrates Crenshaw as a wellspring of Black culture. By starting businesses, Black entrepreneurs forge their own opportunities to build wealth and legacy. They fill gaps for Black consumers, providing goods and services that reflect everyday needs and interests. They hire Black workers. And they help keep dollars circulating within majority-BIPOC neighborhoods, rather than streaming out to enrich distant corporate owners. “So the health of our Black businesses,” says Foster, “is actually the health of our Black families and Black communities.”

"Clean, Healing, Wholesome Food" is the motto of Swift, a restaurant in the Crenshaw District that serves healthy, delicious fare "in a community where health issues are a growing concern," says owner Kyndra McCrary.

Long before Covid hit, these communities confronted economic disruptions stemming from structural racism. Rondo, a historically thriving nerve center of Black life in St. Paul, still bears the scars of heedless mid-twentieth-century highway construction and urban renewal. “Three hundred Black businesses were lost in Rondo from the 1950s into the 1970s as a result of renewal,” laments Deborah Mitchell, executive director of the area’s Aurora St. Anthony Neighborhood Development Corporation, a Nielsen Foundation grant recipient. “So that’s a lot of wealth that left. And 500 to 700 homes were lost, so that’s a lot of equity.”

Brooklyn’s Bed-Stuy, meanwhile, has faced relentless gentrification pressure and rising rents, with the proportion of Black residents shrinking dramatically in the last 20 years. And people living in Chicago’s South Shore have long coped with the fallout of disinvestment and leakage of residents’ spending dollars to outside places; there’s currently a sense of urgency to ready new and existing Black-owned businesses to capture opportunities represented by the imminent construction, in adjacent Jackson Park, of the Barack Obama Presidential Center, according to Tonya Trice, executive director of the South Shore Chamber of Commerce, another Nielsen Foundation grantee. “Now is the time,” Trice says.

Connecting a vital sector

These BDOs not only assist business owners who come to them with specific needs, but also reach out energetically to identify collective needs and bring businesspeople together for mutual support. For example, Deborah Mitchell has been working closely with Black musicians and performers in St. Paul who’ve been sidelined by Covid but also, she’s learned, lack access to venues and are underrepresented at Minnesota’s many music festivals. “Very few of our Black performers are asked to perform. That’s an equity issue,” she says. Mitchell, who in addition to helming Aurora St. Anthony serves on St. Paul’s planning commission, is exploring possibilities for a much-needed Black night club in Rondo. And in July and August her organization brought together Black bands and other artists in two free outdoor performances celebrating Rondo. “The music, the performers, are part of our culture,” says Mitchell, “and if they’re not able to do their work, we lose them.”

Black bands and other artists took part in two free outdoor performances celebrating the Rondo neighborhood in St. Paul, MN, inspired by local musician-relief concerts launched by Twin Cities R&B singer Johnnie Brown (second from left). Says Deborah Mitchell, executive director of a Twin Cities' BDO, “the music, the performers, are part of our culture and if they’re not able to do their work, we lose them.”

Inspired by local musician-relief concerts launched by Twin Cities R&B singer Johnnie Brown, Mitchell also wanted the Rondo events to showcase a powerful joint marketing message: “the Black culture gives back.” Indeed many of the businesses the BDOs advise and assist are deeply involved in community service, both through and beyond their for-profit enterprises. In Brooklyn, for instance, via the Bedford Stuyvesant Restoration Corporation, small grants went to business owners working to provide healthy meals for food-insecure families and prepare first-generation college students for success. John Coleman, owner of Pump High Energy Fitness Center used his grant to add a boxing ring to the space he designed to exercise the bodies and nourish the spirits of people on the South Side of Chicago.

Fueling fair opportunity

One thing these BDO leaders agree on: traditional lending isn’t serving the businesses they work with. Not only do lenders neglect small, under-resourced businesses in favor of more well-heeled borrowers, but entrepreneurs themselves are often leery of taking on costly debt that could jeopardize their operation and those who depend on it. “South Shore businesses are over-mentored and underfunded,” Trice remarks. “We have mentoring programs available from corporate America, from lending institutions, from nonprofit organizations, but it is very challenging for our businesses to acquire capital.” Capital, of course, is the fuel that powers small-business growth, every bit as essential as energy and ingenuity.

Kyndra McCrary wants Swift, her healthy food restaurant, to be a welcoming community space "whether you're coming from the block or the boardroom."

Entrepreneurs typically tap personal resources to start their businesses, and America’s racial income-and-wealth gap (itself the result of entrenched inequities) is one reason why Black-owned businesses, on average, launch with one-third the working capital enjoyed by white-owned startups. That inequality, apart from being unjust, inhibits the small-business sector that employs nearly half of America’s private workforce—it’s a drag on our national economy.

What’s needed, BDO leaders say, is a mixture of grants and flexible low- or zero-interest loans with capital providers willing to pick up the phone or walk the block to check in with busy entrepreneurs and be partners in their journey. Destination Crenshaw, for its part, is looking to establish a small-business sustainability and incubation fund that does just that.

“One of the chief goals [of Destination Crenshaw] is providing a sense of permanence for the Black community: we exist now and we intend to exist in the future,” says COO Foster. Small Black-owned businesses serve that aspiration in multiple ways, as engines of economic activity and as “a marker,” says Foster, “that we’re here.”