Plus: a call to action for business owners
Delali Dzirasa is CEO and founder of Fearless, a full-stack digital services company in Baltimore, MD, with the goal of developing software with a soul – tools that empower communities and make a difference.
Build a business is difficult; Around 50% of companies fail in the first five years. The first few years of an entrepreneur's journey can be difficult and lonely. When I started my Fearless digital services company, I convinced my wife to rent our house and move in with my mother so we could have an extra income while building Fearless in my mother's basement.
That was 10 years ago – Fearless now has over 115 employees.
The story of how to fight to build a technology company and work from a basement or garage until you “make it” is fairly common, but the obstacles for black entrepreneurs make it difficult to find success and support.
University of California, Santa Cruz research shows that minority startups have access to less capital than their white counterparts. The right investors can offer young companies more than just financial resources. The connections that venture capitalists have in the world can bring an entrepreneur the new business, mentorship, and people needed for growth.
Venture capital firms like Harlem Capital and Black Angel Tech Fund focus on changing the faces of entrepreneurship by diversifying their portfolios. Traditional venture capital finance, however, is not the only way to grow your business.
There are other ways and means to get financial and other support to help build a successful business:
Equity crowdfunding: Similar to crowdfunding campaigns like GoFundMe or Kickstarter With equity crowdfunding, non-traditional investors can support companies and receive equity. The crowdfunding of shares enabled by Title III of the CF Regulation of the JOBS Act of 2012 enables all companies to sell securities, whether in the form of equity, debt instruments, sales shares, convertible bonds and more. The crowdfunding platforms for stocks include WeFunder and LocalStake.
Mentor programs: Fearless was lucky enough to be included in the DoD Mentor Protégé program at the beginning of our growth. As the oldest continuously operating mentor protégé program of the federal government, the DoD program has helped us to establish and expand our presence in the contract area of the federal government. NewMe and Black Girl Ventures are two programs that specialize in mentoring for startups.
8 (a) to be certified: The Federal Government has set itself the goal of awarding at least 5% of all federal contract dollars to small, disadvantaged companies each year. These companies are classified 8 (a). To qualify for the program, you must be a small business that owns 51% of the ownership and control of U.S. citizens who are economically and socially disadvantaged, and the owner's gross adjusted income for three years is $ 250,000 or less .
The full definition of what is considered economically and socially disadvantaged can be found in Title 13, Part 124 of the Code of Federal Regulations. Fearless has been classified as an 8 (a) company for several years, and we were able to sign several contracts through the certification.
Tap Small Business Management Resources: Over a million users visit SBA.gov to use tools such as the SBA Business Guide and the Lender Match website. By using the SBA website and contacting your local SBA office, you can take full advantage of the programs available and contact business owners who can offer advice and support.
Identify supporting bankers: Your business is your top priority, and the people you work with should also consider your business a priority. You need someone who is responsible for your success and who is committed to you when you need them. If you are meeting with a banker and feel that you are an account number instead of one person, look for another. If you do not have your banker's personal cell phone number and they are not ready to visit you at your company, take a passport and look for a real partner to assist you.
A call to action for entrepreneurs
I call on entrepreneurs and entrepreneurs who are on their way to promote and invest in black-owned companies. Think back to the support you received and be the model for someone else. Or be the mentor you wanted when you started. Take the time to invest in other black technology companies or to fund the programs. Share your knowledge and experience with black tech executives.
If there is no resource hub for black entrepreneurs in your city, create one. Fearless is a small company and we still managed to help 13 new companies get started with our Hutch accelerator program.
Hutch is an intensive 12-month program that provides entrepreneurs with a blueprint for building successful digital service companies by providing them with the tools, mentoring, and peer support they need to make a lasting impact. We see this program as a kind of basis for our entrepreneurs, which provides them with a basis for support so that they can grow without getting lost with larger companies in the industry.
Help create spaces in your community that promote innovation and business growth.