The good news? All of the attention and assistance that has been given to business owners of color has paid off. In fact, a new survey from Ernst & Young said nearly nine out of 10 established Black and Latino entrepreneurs met or exceeded their performance expectations this past year.
The tough news? Nearly all are concerned that their gains were driven by a short-term boost in attention and could easily be taken away.
The survey produced by EY, titled “The Entrepreneur’s Paradox: How Black and Latino Entrepreneurs Are Balancing Growth and Uncertainty,” revealed the following:
- Strong and sustained performance: Despite the disruptions of COVID-19, 88% met or exceeded performance expectations, 73% experienced moderate to significant business growth and 77% anticipate additional growth in 2022 compared to 2021;
- Impacts of America’s racial reckoning: Nearly 90% percent said that the strong focus on racial equity has increased attention for their businesses, and 99% said this allowed them to invest in their businesses in ways they might not have otherwise by innovating products, improving infrastructure and hiring;
- Concerns about waning attention: Among those who experienced increased attention for their business, nearly all (93%) worry that it will provide only a short-term lift, and nearly half (48%) say a pullback on momentum would make it difficult to retain existing employees.
The survey was commissioned by the EY Entrepreneurs Access Network, an immersive mentoring program and business accelerator for Black and Latino entrepreneurs. This research set out to understand the unique experiences of these leaders during the COVID-19 pandemic and in the wake of a national reckoning on racism and discrimination.
More than 1,000 established Black and Latino entrepreneurs, who lead businesses across industries and produce annual revenues from $2 million to $25 million, were asked to reflect on how the current social, political and economic environment has impacted them, their businesses and their outlook.
Lee Henderson, Americas EY private leader, and executive sponsor, EY Entrepreneurs Access Network, said the responses were telling.
“Black and Latino entrepreneurs are an economic force, and our research underscores their business resiliency and output,” he said. “But more action is needed from consumers, investors and the entire business community to address disparities caused by lack of access to capital, mentors and networks, and to sustainably ensure the long-term economic growth of minority business owners.”
Nit Reeder, EY Entrepreneurs Access Network program director, said the survey also speaks to a possible downslide.
“Our research shows that Black and Latino entrepreneurs are rightly concerned that their businesses might be negatively impacted as focus on them fades,” she said. “The greatest equalizer of wealth disparity is business ownership. We must maintain strong support of minority entrepreneurs to make lasting change.”
Additionally, the survey highlights how Black and Latino entrepreneurs engage with mentors and professional networks.
Of those surveyed, 56% say a network of trusted vendors and partners is key to business growth, and 53% identify access to a mentor as a similarly valuable resource. EY officials said this underscores the impact of the EY Entrepreneurs Access Network model, which not only welcomes participants into an elite network of entrepreneurs, investors, advisers and other business leaders, but also provides each participant with a dedicated EY executive as their personal mentor.
