The movement to bring more business and economic opportunities to the black community is growing, and for black entrepreneurs, it’s growing in key locations across the United States. While cities like San Francisco, California and Charlotte, North Carolina rank at the top of lists for “best cities for entrepreneurs to start businesses in,” they’re not necessarily the best locations for black entrepreneurs.
Which places are? Cities in the South, where black Americans are most likely to congregate and where deep roots and community support can help bolster new businesses. On the top of the list is Atlanta, Georgia; Montgomery, Alabama and Memphis, Tennessee. Cities across the south-east fill the charts in Blacktech’s 2017 list of Best Cities for Black Business Owners, from D.C. to Miami, Florida, but the three hot spots in Georgia, Alabama and Tennessee represent ripe opportunities for the business-savvy and creative.
Here’s why businesses owned by black Americans do best in these cities.
Black community presence
You won’t find a higher presence of black Americans anywhere in the United States than in the south-east, where black Americans have historically made up a significant minority of the general population. For a while, marketers and demographic analysts assumed that the effects of the Great Migration, when freed black Americans moved to the North by the millions hoping to escape racism, would be in play forever.
But new data shows black Americans today are eschewing the North and returning home to the Southern states their ancestors may have migrated away from. As black Americans discover that the North is equally capable of dishing out racism, they’re opting for black community over beliefs about Northern liberalism. And the south-east still bears the largest proportion of black Americans in the United States, statistically.
Black communities are increasingly prioritizing supporting black-owned businesses, which means black entrepreneurs looking for community support are most likely to find support in states with concentrated black populations.
Black business networking
One of the biggest disadvantages black entrepreneurs face is attempting to secure the funding to open or sustain their business. With a lack of family wealth to inherit or draw from and systematic racism reinforced by most major or national banking institutions, it can be a struggle to obtain the cash necessary for a start-up. Black business owners are more likely to find empathetic investors or lenders from black-owned banks and institutions across the south-east.
Black-owned banks like Liberty Bank and Citizens Trust Bank, which are more often found in the south where black communities are located, are often committed to supporting the local black community, which means they often serve as safer, more welcoming environments for black entrepreneurs to seek opportunities.
Booming business towns
Although black communities exist across the south-east, not every city with a major black community is a hub for business. However, cities like Atlanta, Montgomery and Memphis offer vibrant economic opportunities for entrepreneurs. Memphis has a low cost of living index and unemployment rate, and one of the highest rates of black-owned businesses in the nation. Organizations like the Black Business Association allow black business owners to have a cost-effective VPN solution, organize and address community issues, and offer networking opportunities for people looking to develop their own businesses.
Montgomery and Atlanta both have Chambers of Commerce dedicated to bolstering black or minority business owners, and lots of business activity to boot. These cities provide all the elements needed for a great business to grow: ample competition to keep the game moving forward, economic opportunities that exist to support black communities and a community in place that wants to advocate for itself.
Black Americans face unique challenges when it comes to starting a business, and picking the right location might make or break a business. An entrepreneur looking for the best start should consider a city that offers all the right elements — and the south-east is a good place to start looking.
