In Memphis, Effort to Boost Businesses of Color Gains Momentum

Posted July 22, 2019, By the Annie E. Casey Foundation

The Memphis timeline

In May 2018, Mem­phis May­or Jim Strick­land announced an ambi­tious plan to help 800 of the city’s bur­geon­ing black-owned busi­ness­es grow their rev­enue by $50 mil­lion by 2023.

Called the 800 Ini­tia­tive, the pro­gram received an ini­tial $500,000 allo­ca­tion from the city’s 2018 – 19 bud­get and a $1 mil­lion com­mit­ment from local indus­try over four years to pro­vide tech­ni­cal assis­tance, grants and loans to help entre­pre­neurs bring their oper­a­tions to scale.

So far, the results are promising.

In just over a year, 800 Ini­tia­tive part­ners — includ­ing Start­Co and Epi­cen­ter, two small busi­ness hubs, and Chris­t­ian Broth­ers Uni­ver­si­ty — helped more than 200 African-Amer­i­can busi­ness own­ers bring in a com­bined total of near­ly $11 mil­lion in new rev­enue. They also raised an addi­tion­al $3.5 mil­lion to help seed a busi­ness loan fund.

Busi­ness own­er­ship can enable African Amer­i­cans to build wealth faster than tra­di­tion­al employ­ment, cre­ate jobs for fel­low com­mu­ni­ty mem­bers and devel­op an asset that can be passed down to the next gen­er­a­tion. Yet, in Mem­phis — which has been rec­og­nized as a top city for African-Amer­i­can entre­pre­neurs — black busi­ness own­ers earn just 15% of what their white coun­ter­parts earn and only 2% have paid employees.

We are com­mit­ted to help­ing our small, minor­i­ty-owned busi­ness­es access resources, cap­i­tal and oppor­tu­ni­ties,” says Joann Massey, direc­tor of Memphis’s Office of Diver­si­ty and Com­pli­ance, which hosts the pro­gram. “[It] is a fun­da­men­tal next step in estab­lish­ing a more equi­table city.” In addi­tion to her role with the 800 Ini­tia­tive, Massey rep­re­sents Mem­phis — and is one of 35 cohort mem­bers — par­tic­i­pat­ing in the Annie E. Casey Foundation’s South­ern Cities for Eco­nom­ic Inclu­sion ini­tia­tive. This ini­tia­tive con­venes mem­bers from sev­en cities in the South on a semi-annu­al basis to explore ways of increas­ing job and wealth-build­ing oppor­tu­ni­ties for peo­ple of color.

Being part of the South­ern Cities cohort has played a major role in the progress we have made here in Mem­phis regard­ing equi­table eco­nom­ic devel­op­ment strate­gies,” says Massey. The access to a net­work of experts and the shar­ing of best prac­tices, bar­ri­ers and chal­lenges has real­ly added val­ue to our work.”

Since May­or Strick­land first took office, Mem­phis has increased the share of city con­tracts award­ed to firms of col­or from 12% to 21%. Massey and the oth­er 800 Ini­tia­tive part­ners are look­ing to build on this progress by pro­vid­ing busi­ness coach­ing and net­work­ing oppor­tu­ni­ties to help African-Amer­i­can own­ers com­pete for even more gov­ern­ment contracts.

LEARN MORE ABOUT THE SOUTH­ERN CITIES FOR ECO­NOM­IC INCLU­SION COHORT

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