Minority-owned women’s businesses are growing at a fast clip—yet these entrepreneurs still find they need to work harder.  

By Chris Penttila

Gena Y. Davis feels she was born to be an entrepreneur. As a kid, she sold a variety of products and remembers running home to tell her parents about making one of her first sales. “It gave me so much confidence,” says Davis, 38.

That confidence carried her far. After several years as a marketing assistant for a major movie studio, Davis started The Gena Davis Agency in 1995, a three-employee marketing and communications firm in Los Angeles, that specializes in emerging and niche markets. With sales nearing the half-million-dollar mark for 2005, Davis isn’t second-guessing her choice to go it alone. “I’m in control of my own destiny,” she says. “It’s such a good feeling.”

Davis isn’t the only black woman who feels good about leaving corporate America. Businesses owned by minority women are growing at six times the rate of all U.S. firms and represent nearly 36 percent of all companies owned by minorities, according to a November 2004 study conducted by the Center for Women’s Business Research and underwritten by Bank of America. Last year, an estimated 1.4 million privately held firms were majority-owned by minority women, generating $147 billion in annual sales.

 “It’s fantastic,” says Sharon Hadary, executive director of the Center for Women’s Business Research in Washington, DC. “Entrepreneurship is an opportunity that knows no race or ethnicity.”

It also shows no signs of stopping. According to the study, the number of black women-owned businesses grew nearly 33 percent between 1997 and 2004, while the number of Hispanic women-owned businesses grew by almost 64 percent. The numbers of Asian/Pacific Islander and Native American women-owned businesses both grew by nearly 70 percent during the same period.

 Minority women business owners also include first- generation immigrants—a group that continues to grow. The number of immigrant women business owners has increased almost 190 percent since 1990, according to recent research by the Immigration Policy Center, a Washington, DC, group that analyzes U.S. immigration law and policy. The U.S. Census Bureau found that women from Korea, Mexico and Vietnam topped the list of immigrant business owners in 2000.

Opportunities and Challenges
Many banks see a growing opportunity in catering to minority-owned businesses. Wells Fargo has made a lending commitment to women-owned businesses—since 1995, it has lent more than $22 billion to women business owners nationwide. “It’s a growth opportunity we want to support,” says Rebecca Macieira-Kaufmann, executive vice president and small-business segment manager at Wells Fargo in San Francisco.

Although the money is there, minority women still see barriers to capitalization. “The rates are good right now. The problem is trying to get the loans,” says Leticia Luna, 52, a San Francisco entrepreneur who owns a Latin nightclub called Roccapulco Supper Club and a restaurant called Leticia’s. Ten years ago, she applied for a $750,000 SBA loan to update the restaurant, fronting $250,000 in savings to secure the loan. She paid it off in 2001, but was left frustrated by the experience. “It was hard to get the loan; it took at least six months,” she says. “Never did I think it was going to be this difficult.”

Getting enough business, securing contracts and customers and gaining access to capital tend to be the main concerns of minority women business owners, says Macieira-Kaufmann. Anxiety over borrowing is another issue that has kept minority women-owned businesses from reaching the next level.

As any entrepreneur knows, there’s a direct link between networking and revenue generation. For many minority women entrepreneurs, success in business is no longer just about joining a network; it’s about getting access to influential networks that will increase knowledge, spur deal making, provide mentoring and propel growth.

As a black woman, Davis feels she has to hustle a little bit more, to network just a little bit harder. While she sees the government making strides toward diversity in contracts, private industry remains a harder nut to crack. “My biggest challenge is to get bigger pieces of business,” she says. “We have to get ourselves out there, really market ourselves, and be in front of the people we want to do business with.”

Chris Penttila is a freelance journalist in the Chapel Hill, North Carolina area.