In the UK the contribution of small businesses is significant, not just in terms of revenue generated and jobs created, but in terms of what they bring to the life of their local communities. We almost take the variety of small businesses across different sectors and places for granted, and this can mask the considerable diversity of the entrepreneurs and owners behind them.
"If small businesses are to be key to the post-pandemic economic recovery, we need all small businesses to be part of the story."
The media often (mis)represent the entrepreneurial stereotype as a heterosexual, white, upper-middle-class male. The reality is that there is hidden diversity among the 3.3 million small and micro businesses. Comprising an intersection of ethnic minority-led businesses, women-led businesses, disabled-led businesses, the diversity of entrepreneurs and business owners undoubtedly contributes to the strength of the business base in the UK.
The challenge facing diverse founders
A recent survey conducted with Small Business Britain highlighted higher levels of entrepreneurial ambition among people of colour, although we know such groups to be under-represented. Of the people it surveyed from ethnic minority backgrounds in May 2021, 60% had considered starting a new or additional venture.
This highlights important questions as to how to nurture and support aspiring entrepreneurs from ethnic minority backgrounds. Especially given these founders often face additional challenges when starting and scaling businesses.
Among the primary challenges where existing and aspiring ethnic minority entrepreneurs perceived greater barriers in pursuing entrepreneurial opportunities than their white counterparts, were a lack of networking opportunities and a lack of support from friends/family, as well as racial discrimination.
These issues were in addition to the common challenges identified relating to access to funding/finance, lack of confidence, a lack of business skills that were also more acute among existing and aspiring ethnic minority entrepreneurs.
These barriers represent a significant challenge for ethnic minority entrepreneurs, constraining opportunities and the prospect of entrepreneurial growth. These challenges are also more profound where they are intersectional, for example among female ethnic minority entrepreneurs.
Societally there remains a need to address the systemic barriers that disadvantage any entrepreneurs from pursuing enterprising opportunities. There is a need to combat the discrimination that diverse founders encounter, which curtail the ambition and growth of existing and aspiring entrepreneurs. There are, of course, more targeted ways to support diverse founders as they look to start and scale their businesses.
An inclusive community
The research highlighted that entrepreneurs do not have access to the same support and networks that we know to be critical to developing small businesses. Building and investing in the social capital of diverse founders is as important as ensuring they have the necessary financial capital.
Among those surveyed, another issue was access to training and the development of business skills. An example of the support available is the recently launched 'Help to Grow' programme, which is supporting small businesses to develop their leadership skills and digital capabilities. Despite there being a wide range of initiatives to develop the skills of entrepreneurs, the findings highlight the need to ensure ethnic minority entrepreneurs are able to access support in starting and scaling their businesses within the wider ecosystem.
The diversity of the small business community in the UK is crucial to its future success, and so small businesses need to help each other and commit to embracing diversity and inclusion. The aim of Small Business Britain's campaigns - i:entrepreneur, alongside d:entrepreneur and f:entrepreneur - is to build this inclusivity,promoting and enabling participation of all entrepreneurs by recognising and celebrating their contributions and successes. This is key to building a stronger small business community as a whole.
Equality and ambition
The pandemic has been catastrophic for many small businesses, with ethnic minority owned businesses found to be disproportionately impacted. If small businesses are to be key to the post pandemic economic recovery, we need all small businesses to be part of the story. For this to be the case we need to close the racial equality gap, and ensure that ethnic minority entrepreneurs are able to realise their growth ambitions.
Given the systemic challenges facing ethnic minority entrepreneurs are well understood, there is a need for greater action. The inequalities, barriers and disadvantages faced by many ethnic minority entrepreneurs means their businesses surviving and thriving against the odds. Addressing these barriers is about realising equality is fundamental if we are to build a more inclusive economy and society post-pandemic.Visit Website
Published: 23 June 2021