Being slapped in the face with your gender and race is exhausting. Being devalued due to the same is demoralizing, degrading, and devastating. Unfortunately, that is what it means to be a Black woman in Corporate America. We make 37% less than our white male peers and 20% less than white women. The average woman would have to work until March 15th of the following year (approximately 75 more days) to earn the annual salary of the average man. A Black woman would have to work until August 3rd (215 more days) to reach the pay of her white male counterpart. According to the American Association of University Women, Black women won’t achieve wage equity until 2369. This staggering reality has led many Black women to leave Corporate America to venture into entrepreneurship.
In Corporate America, our “place” as Black women is hard-earned. Often, we fight against the current where those in seats of power pull their brethren up the ladder job after job, promotion after promotion. Regardless of qualification, education, or skill, who you know in the hierarchy matters. Who they know matters even more. They pull from the pool of who they knew from the last job, who works for them now, or who knows the people they know. It is a limited and incestuous waterhole. A Black woman with an advanced degree is more likely to reach human capital flight* than C-level attainment.
Forced to take our talents elsewhere, Black women have become skilled at networking. Forging bonds over vacating seats at corporate tables, we create access to each other and the many resources each brings. So much so that even social resources are an essential commodity. For instance, one might leave Wall Street to pursue entrepreneurship. She may have formed relationships with investors, financial advisors, and lawyers in her lucrative position over the years. Now free to do as she pleases as her own boss, she can leverage her community in her new venture. That access is now capital.
Other forms of capital include tapping into our savings, 401K, and family and friends. Many Black women will drain their savings, bootstrapping to make their dream a reality.
*The phenomenon in developing countries where the best and the brightest seek employment overseas.
Black Women VCs On the Rise
Capital is king for an entrepreneur. To a Black woman entrepreneur, it is harder to come by. Venture capitalists are leaving money on the table when they don’t diversify. With a lack of Black and female representation at the highest levels of VC firms, the majority misunderstands our target markets. Harvard Business Review found that 81% of capital firms have no Black investors at any level. Imagine explaining the needs of someone with hyperpigmentation or the complexities of finding a red, vegan lipstick with blue undertones to a panel of white men with no understanding of the socially-conscious Black beauty industry.
Such was the case for the two women who started The Lip Bar. The founders found themselves ridiculed, sitting across from venture capitalists who did not understand their brand, product, or target audience. The Sharks missed the opportunity to invest in what would become a successful brand by the time the episode ran a second time. With a Black woman venture capitalist on the panel of Sharks, they might have been well-attuned to address the needs of the brand’s audience –bold, cruelty-free products that made them feel beautiful by anybody’s standards. When the VC looks like you, the opportunity for investment increases.
How can we take ownership of our social and financial capital?
- Take advantage of social access. Our tribes are full of knowledgeable human resources with the information and skill we need to delegate or hire, scaling our businesses to the next level. Resources like Build it B2B (a Side Hustle learning experience) are great resources for Black women in business looking for abundant resources.
- Attract more venture capital fundraising, procure bank loans and lines of credit, or apply for grants that understand your brand and target audience. If they don’t understand where the money will be coming from, they won’t put money in.
- Toot your own horn. Don’t be shy about sharing your story. Join communities of other Black women entrepreneurs. I highly encourage you to check out the She Runs It community. It is a place where questions get answered, and support is delivered.