Narrowing the Racial Wealth Gap through Business Ownership

This new Strategy Spotlight from Asset Funders Network, written by Joyce Klein of FIELD at the Aspen Institute, summarizes existing research on the link between the racial wealth gap and business ownership and provides resulting recommendations for funders. Key take aways include:

  1. Existing research highlighted in the Strategy Spotlight indicates that the racial wealth gap is closely tied to lower levels of business and financial assets among African Americans and Latinos.
  2. African Americans and Latinos face several key barriers to wealth creation through business ownership, including: lower levels of financing, lower levels of education and business experience, and lack of market access. This results in lower rates of business growth and survival among African-American and Latino-owned firms.
  3. The Strategy Spotlight highlights two strategies that funders can support to improve opportunities for minority populations to create wealth through business ownership: microenterprise development organizations and worker cooperatives.
  4. Several case studies in the Strategy Spotlight illuminate the potential for funders to support these strategies and the resulting benefits for African Americans and Latinos. Additionally, original evidence from FIELD surveys demonstrates the success of microenterprise development organizations in supporting minority-owned firms and helping them to generate wealth.

Read the full study to learn more about how Small and Microbusiness can help narrow the racial wealth gap

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