Small businesses are essential to thriving local economies, but we’re no stranger to the complex barriers that exist which prevent underrepresented business owners and entrepreneurs from accessing the financial and social capital needed to grow and sustain successful businesses. At Eastern Bank, we’ve long worked to address these barriers and dismantle that status quo, and establish banking relationships rooted in equity.
Our newest offering, Equity Alliance for Business, is designed to advance growth opportunities for underserved business owners and entrepreneurs with specialized banking offerings specifically for underrepresented women, people of color and all of their intersectionality, including LGBTQIA+, veterans and disabled communities. The program is implemented through four pillars, including credit solutions, access to entrepreneurial insights and resources as well as other banking community services and input from leading business support organizations—all delivered by a diverse team of bankers.
During Small Business Month in May 2023, to celebrate advancing opportunity for underrepresented entrepreneurs and bring together community leaders and business support organizations with a similar goal in mind, we hosted a fireside chat moderated by Eastern Vice Chair and President, Quincy Miller, with dynamic speakers from academia, government, and the private and nonprofit sectors. The leaders shared unique perspectives about solutions and resources aimed at shaping a path forward for diverse businesses across the Commonwealth, acknowledging three key opportunities.
#1: Unlocking Business Opportunity Through Trusted Programs with Shared Lived Experiences
Creating pathways for success for underserved entrepreneurs and small business owners goes far beyond access to financial capital. To move the needle, also recognizing access to trusted, culturally competent people, organizations and resources—that can provide education, mentorship and ideation—comprehensively positions businesses with the resources to achieve sustainable, long-term growth.
Dr. Shakenna K. Williams, Executive Director of the Frank & Eileen™ Center for Women’s Entrepreneurial Leadership at Babson College, noted, “When we look at the data, it shows that women entrepreneurs, particularly Black women entrepreneurs, [are] looking at access to entrepreneur education [and] access to mentorship.”
To unlock business opportunity, Dr. Williams explained how her team at Babson held a roundtable of Black women entrepreneurs from across the country, including undergrads, grads, alumni and millionaire Black women, bringing access to experts and mentorship directly to the women entrepreneurs participating in her program. Each spoke about the unique challenges faced in her career, how they overcame them and what resources that helped.
Ultimately, connecting entrepreneurs with mentors and resources who understand different barriers through their own lived experience provided a facet of unlocking business opportunity that financial capital alone could not. To drive change in this area, we encourage subject matter experts to lend their experience and mentorship to underrepresented small business owners and entrepreneurs through trusted programs connected to the communities in which they identify, such as Equity Alliance for Business and business support organizations Ascendus, Black Economic Council of Massachusetts (BECMA), Center for Women & Enterprise, Interise, Massachusetts LGBT Chamber of Commerce, and Mill Cities Community Investments (MCCI), so we can all support offering business connections and resources in a trust-based way.
#2: In Order to Dismantle Inequity, We Must Understand its Roots and Data Can Help
As we reflect on history, we must recognize the deeply rooted inequities that exist through lending and other processes embedded in our society. We have the opportunity to break down barriers by tracking sources of inequity through data, as a means towards shifting the narrative and perceptions of underserved business owners.
Quincy Miller put this into perspective saying, “A question we hear in finance all the time is ‘why don’t banks lend more to communities of color?’ That answer is nuanced…you have two applicants applying for a business loan. One has a net worth of $220,000 and owns their home; the other has a net worth of $8,000 and perhaps owns a home but 97% of it is financed with a mortgage leaving no available equity to launch their business.” He added, “The first person can access a home equity loan to start their business, and the second can’t—the systems that feed into that scenario start with access to education and gender and racial pay gaps.”
Understanding the qualitative and quantitative data behind scenarios such as this helps us to understand the broader landscape. As Carmen Panacopoulos, Sr. Business Strategy Manager with the Federal Reserve Bank of Boston, emphasized, “The pandemic amplified and cemented the need of small businesses across the Commonwealth [and] across the country; it’s very evident the data that actually showed those inequities continues to persist….we need to understand and unpack the quantitative data to really have those conversations and stories.”
Collecting data on the sources of inequities—and digging deep to understand the stories behind them—is essential to informing programs that can ultimately help remove obstacles business owners face.
#3: Solutions to Inequity Must Reflect Intersectionality
Analyzing the barriers associated with the different ways business owners identify—including LGBTQIA+, veterans and disabled communities—is essential to providing resources designed to remove them.
During the conversation, Stephen Chan, Steering Committee Member, Asian Community Fund, spoke of the importance of intersectionality and how every person is not defined by only one thing. He said, “We should analyze with this intersectional lens, the various barriers that layer on and cause outsized harm and lack of opportunity for different individuals.”
As opposed to siloing and targeting specific resources for micro communities, we can focus on shared resources and efforts to address shared barriers. Through multiple avenues of mentorship and support groups, we can empower communities who might otherwise lack direct access to social capital and provide them with new ways to gain such resources.
In order for our entire community to thrive we must level the playing field, and small businesses are the backbone to that success. To create systemwide transformative change, we must embrace the programs and community leaders looking to bring about that change. At Eastern, we encourage the business community to collaborate with us, as together we can drive the change that needs to happen in the Commonwealth and beyond.
To learn more about the business support organizations working with Eastern Bank and underrepresented entrepreneurs, or for more information on how to get involved, please visit the Equity Alliance for Business homepage or speak with an Equity Alliance for Business banker.
Photos courtesy of Nate Photography.