African American Entrepreneurship


Entrepreneurship has been termed as a very powerful source of personal development as well as raising the economic growth of a country. Individuals grow wealth through entrepreneurial practices. African Americans are among the minority group in America which contribute a large percentage of income for the country. I have decided to research on the African American entrepreneur due to various reasons. Firstly, African Americans are among the rapidly developing entrepreneurial marginal in America. However, they are struggling to sustain their new business schemes. Most of the upcoming African American entrepreneurs fail to continue operating their business within the first four years of start-up. This is due to the racism they experience while operating their business (Michalopoulos, & Papaioannou, 2013). Most of Americans fail to recognize the efforts made by the African American entrepreneurs to start businesses. Though there is the anti-discrimination policy in America, black American entrepreneurs have poor access to contracts, capital, and information. Lack of resources makes it difficult for black Americans to survive in businesses. Despite those challenges, some of the black American entrepreneurs persist and do it better than the Native Americans in business. Those successful black American entrepreneurs come out of depression, exclusion, and political alienation. The historical development and experience of black Americans are challenging and understanding their entrepreneurship has not been easy due to the flawed theoretical constructs due to the false pieces of evidence. There is inadequate tradition about the business establishment in black American communities. However, black Americans have attained the same entrepreneurship spirit as the other ethnic groups in America despite their neglect. Black-owned firms are increasing in America despite all the challenges black Americans face in the country. This has a positive impact on the economic growth of America. Revenue collected from those businesses is used for service delivery to citizens. However, there is an extension limit on the growth of those emerging businesses due to the limited resources they have access to. Due to those factors, I have decided to critically analyze all the available data to identify the emerging issues which affect the black Americans venturing into business. Entrepreneurs and educators may find these finding helpful in contributing to the existing body of knowledge regarding ethnic factors which affect entrepreneurs.

Background of the Problem

The main reason as to why individuals become an entrepreneur is to improve their living standards and avoid poverty. Ethnic economics has been used as a mechanism by ethnic groups to shape their fortunes and avoid discrimination and economic disadvantage. Researchers have identified the need to have more entrepreneurs through the examination of the interdependent relationship between the marginal business vendors and the environment they work on. In 2007, black American presented a 13% population of the entire population, and they owned 7% of businesses in America which was an increase from 45% to 60.5% in 2002 (Michalopoulos, & Papaioannou, 2013). This growth surpassed the Native American businesses according to reports presented by the American Department of Commerce Minority Business Development Agency in the year 2013. Despite the positive growth, black Americans presented poor reports in business performance against the total job opportunities generated at 0.8% (Keim, 2018).

The scope of the Study

This study focuses on understanding the challenges faced by black Americans and providing solutions which can be used to ensure equality is practiced in businesses. The study also recognizes the top black American entrepreneurs and find out the footsteps they followed to emerge victorious in a country where racism is practiced (Keim, 2018). Americans treated Africans as monkeys, and they did not want to associate with them. There were areas and services only preserved for the Americans. Americans termed black Americans as refugees. The government took part in promoting the ethnic differences by blocking black Americans from accessing starting capital and other privileges given to American entrepreneurs. All those difficulties will be covered in our study.

The Objectives of the Study

This study aims to give identify and provide solutions to the problems affecting African American entrepreneurship. The study also aims at providing an understanding of the issues facing entrepreneurs venturing into business outside their countries. The study will provide an adequate analysis of the businesses of black Americans in America.


The methodology is the process by which data is collected for analysis. In order to capture all the required information, various data collection methods should be used. The purpose of my research is to identify the challenges faced by African American entrepreneurs operating in America (Keim, 2018). I will deeply analyze the trending factors which are affecting the growth of black Americans venturing into business. There has been confusion on the entrepreneurial work and the motivation among black Americans despite their contributions in various areas of businesses. There has also been confusion on how the black American community supports its entrepreneurs in their ventures. Through the explorer of traditions of black American who were first to live in America, this study will offer complete information on the pathways followed by black Americans to settle in the current location.



Research Design

I used a qualitative phenomenological approach to determine the understanding of the experiences and challenges faced by black Americans. Phenomenological research is the strategy by which a researcher identifies the quintessence of human experiences about a portent explained by participants in a study. In the review, I focus on the voices and perspectives of black American entrepreneurs in America. It is the story narrating the origin of those entrepreneurs who lived in the past times concerning predict the future in entrepreneurship. This research study depends on interviews and use of relevant literature to conclude the understanding of the entrepreneurial work of black American business owners. In qualitative analysis, the researcher must assume that he knows little about the places and areas they will be visiting. This will preempt the assumptions he has about the target group. If you behave like you have an idea about them, they may decide to change their daily routine of doing things. Phenomenological approach aids in exploring how individuals make sense of experience and transform experience into perception, both individually and in a shared meaning. The phenomenological approach also objects at getting a more in-depth clarification of the nature of our daily experience. This approach qualitatively internment show phenomenon is experienced by human beings and describes how they make sense out of it and the discussion about the perceived information. This method was of great importance because it allowed participants to share needed information freely. The environment for collecting data was very conducive, and the participants were very willing to associate with the researcher and were collectively waiting for the results of the research.

Additionally, the research was qualitative. This means that researchers collect data themselves through interview of participants, going to archives and examining documented results and observing how participants behave. Documents in the archive carrying a lot of information since they were mostly written during the time of the investigation. Individual experiences accumulate into personal narratives, family stories, and bibliographies. In my research, I used a systematic sampling technique to collect data. The participants openly shared their life experiences and family stories to the research questions. Some of the participants were literate can answered questionnaires correctly. I structured open-minded questionnaires to allow participants to provide all necessary information for the research. Open-minded questionnaires do not restrict the participant on the data to be provided. Qualitative methodology helps the researcher to engage conversations with the participants. This allows the participants to share information with the researcher freely. During the engagement, I assured participants to feel free to share their perceptions without interruptions and make their voices count in information delivery.

Research Setting

I visited the premises of participants for observation and conducting interviews. For data collection, I sampled California which is the economic hub for the Central Valley. Businesses were found in the downtown district and moderate-income areas (Keim, 2018). California is the city having different ethnic groups due to its relative cost of living. Most of the individuals living there are poor immigrants who provide unskilled labor. However, the city has good weather which can sustain agriculture. Due to the different ethnic groups, there is income inequality. The county continuously receives new immigrants who hope to get better lives. Due to the high unemployment rates, some immigrants start their businesses after settling in the county. The increased rate of immigrants increases unskilled labor, street children and poor education to children. The ethnic entrepreneur reflects on the loneliness of starting a business. African American businesses are small and located in sparse areas like the west side of California where the economy is deficient.The low economic growth makes it difficult for African American businesses to succeed.

Research Participants                                       

The target population consisted of black American who have started businesses. I sample a group consisting of 25 African American entrepreneurs consisting of 15 men and ten women who live in California. All of the participants owned different types of business ranging from hotel businesses to publishing and clothes shop. Five of the participants had run offices at their homes. Selection of the participants was systematic where I identified areas where I am supposed to collect enough data from. The selection was according to the availability of the participant and the willingness to give information. The participants were chosen via a network, faith bodies, and personal contacts. Since I used phenomenon approach, the selection favored those individuals who have experienced it and have a clear understanding of the phenomenon. Sampling, in this case, was homogeneous whereby all the participants were black American entrepreneurs who have experienced the same phenomenon. There was no year requirement although I picked individuals having their age ranging from 40 to 80.

Methods Used to Collect Data

To accomplish the research, instrumentation included were interviewing the participants, use of questionnaires and direct observation of activities performed by the African American entrepreneurs. I used open-ended questions in the interview. My target was to allow each member to express their ideology freely. I also used structured phenomenological interviews to address the research questions. I designed the following interview questions to address my topic of research:

  1. Please discuss your life experience and the route you followed to reach where you are at today as an entrepreneur.
  2. Please narrate how you started your business in California.
  3. What are some of your best practices in your business which you can share?
  4. What factors did you consider to venture into your business of choice?
  5. Five years from now where do you see the position of your business?

Observations and interviews were done on the premises of the participants. However, the five participants who were having offices in their homes, I conducted a phone interview. All the field works were well recorded on a notebook with the aid of a tape recorder. All the recorded interviews were transcribed and printed for recording keeping. The research did not emphasize on validity due to the assumption that I did not have predefined knowledge about the people I was interviewing. Due to the nature of the study, participants were encouraged to provide correct information. Validity in this research was obtained through the accurate method of collecting data. Open-ended interviews made participants to express their understanding and perception of the researched topic freely. I recorded all the conversations, statements and accounts made by the participants. Recording interviews on tape showed originality information. After completion of research, all answers were reviewed with the accomplices to determine reliability. The participants were given a chance to provide feedback on the whole process. I carefully went through all the information provided and followed the necessary steps to credit all sources. I supplemented my captured data with secondary sources. When through books and articles discussing my topic of research. I also used the internet to get further information.



Data Analysis

This study captures the voices and entrepreneurial experiences of 25 black American in California. It explores the perspectives and traditions of African American entrepreneurial work. These findings represent the views and voices of blacks living in America based on observation and interviews of the twenty-five black American firm owners. The findings are organized according to the five questions of the research. The participants narrated the path used by their fathers to get where they are today and the reasons for starting the kind of business they are managing. They also explained the best practices in their businesses. This was to help upcoming entrepreneurs to choose wisely the kind of business they can start. According to the information provided by the participants, there are three factors which describe the path followed by the black Americans to pursue their entrepreneurial practices namely;

  1. Resources are coming from cultural and individual experiences.
  2. Family background and life experiences
  3. Structural barriers which challenge all of them in their way.

The following cycle describes the historical development of the entrepreneurial work of black American.

I grouped the data into ranges and counted frequencies in each range. In my case, I have sampled ten women and 15 men who ventured into business. The variables are ages, date of interview, family business history and the location of offices. Age value ranges from 40 to 80 whereas office location was either at the town or home-based. The upper limit of age is 80, and the lower limit is 40 years (Michalopoulos, & Papaioannou, 2013). After establishing the range, frequencies column are made consisting of the names of the participants. I then used relative frequency to compute the percentages of community support and the family history of the participants. 70% of the sampled population consisted of individuals having years ranging from 50 to 80 (Michalopoulos, & Papaioannou, 2013). This is because those had rich information about their origin. The cumulative frequency adds all the frequencies in a row together with related columns. Adding all the ages and dividing by 25 gives the average age of the participants. The following table shows the profile of each participant. We only captured the first names to hide the identity of the participants for security purpose.

Participant Sex Age Community support The family history of business Date of interview Office location
Ken male 50 No Yes 3/01/2019 Home
Diana Female 44 Yes Yes 3/01/2019 Home
Ronald Male 40 No No 3/01/2019 Home
Racheal Female 49 No No 3/01/2019 Home
William Male 45 No Yes 3/01/2019 Home
James Male 47 Yes No 3/02/2019 Town
Leonard Male 70 Yes Yes 3/02/2019 Town
Oscar Male 75 Yes No 3/02/2019 Town
Deborah Female 52 Yes Yes 3/02/2019 Town
Faith Female 74 No No 3/02/2019 Town
Janet Female 50 Yes No 3/02/2019 Town
Smith Male 69 Yes Yes 3/03/2019 Town
Michelle Female 80 Yes Yes 3/03/2019 Town
Abigail Female 46 Yes Yes 3/03/2019 Town
Agnes Female 40 Yes Yes 3/03/2019 Town
Daniel Male 57 No Yes 3/03/2019 Town
Harry Male 55 Yes No 3/03/2019 Town
Jack Male 59 No Yes 3/04/2019 Town
Oliver Male 78 No No 3/04/2019 Town
Nelson Male 65 Yes Yes 3/04/2019 Town
Fidelis Male 61 No Yes 3/04/2019 Town
Dominic Male 78 Yes No 3/05/2019 Town
Debra Female 79 Yes Yes 3/05/2019 Town
Tracy Female 69 Yes Yes 3/05/2019 Town
Chris Male 80 Yes Yes 3/05/2019 Town


From the table, the following pie charts display the community support and family history of the participants.



The primary mission of the study was to identify the challenges facing African American entrepreneurs in California. The methodology used in getting the information perfect. The participants expressed their views which helped in understanding the source of the problem. California lived in various ethnic groups. Those groups have different cultures and nature of doing things. Discrimination should be stopped, and equality exercised. Government plays a significant role in promoting equality among citizens. Most entrepreneurs face challenges of starting capital. The government should intervene to ensure all entrepreneurs get equal opportunities to capital and training. Findings of this study show that African American entrepreneurs lack mentors who can show them the tricks of business. Exclusion of black American in economic growth has a negative impact on the rising living standards of citizens. Involving black Americans into business activities will help build the economy of the county and also aid in raising the standards of the individuals.


Michalopoulos, S., & Papaioannou, E. (2013). Pre‐colonial ethnic institutions and contemporary African development.Econometrica81(1), 113-152.

Keim, C. (2018). Mistaking Africa: Curiosities and inventions of the American mind. Routledge.