According to data from the Kauffman Foundation, 380 out of every 100,000 Black adults became new business owners during the 2020 pandemic, up from 240 in each of the prior two years.
The data mirrors findings from a recent study by the National Bureau of Economic Research, which found that Black Americans were more likely to become entrepreneurs during the pandemic and that new businesses were disproportionately located in Black neighborhoods.
“There’s been clear intent in banks and government, etc., to make sure all the financial support throughout this year reaches Black neighborhoods,” Guzman said.
Last year, amid the nation’s racial reckoning, The Associated Press reported that Google searches for “Black owned businesses near me” reached an all-time high.
“It’s great seeing people realize that where they shop can be another form of activism, that it’s a way to put your money where your mouth is,” said Randy Williams, founder of Talley & Twine, a Black-owned watch company in Portsmouth, Virginia.
After George Floyd’s death, major banks promised record amounts of money to Black-owned and minority businesses and corporations.
Many of the businesses started during the pandemic were “necessity startups” intended to help people survive layoffs and reductions in income. These businesses typically have higher failure rates than “opportunity startups.” However, for some Black Americans, the pandemic presented a new opportunity.
“They had a moment of pause induced by the pandemic,” he told the Los Angeles Times. They thought, “Let me try something else.”