{"id":1936,"date":"2020-10-31T00:40:16","date_gmt":"2020-10-31T00:40:16","guid":{"rendered":"https:\/\/lastandardnewspaper.com\/staging\/news\/business-1\/black-entrepreneurs-are-turning-to-crowdfunding-for-financing\/"},"modified":"2020-10-31T00:40:16","modified_gmt":"2020-10-31T00:40:16","slug":"black-entrepreneurs-are-turning-to-crowdfunding-for-financing","status":"publish","type":"post","link":"https:\/\/lastandardnewspaper.com\/staging\/news\/business-1\/black-entrepreneurs-are-turning-to-crowdfunding-for-financing\/","title":{"rendered":"Black entrepreneurs are turning to crowdfunding for financing"},"content":{"rendered":"

Crowdfunding platforms like GoFundMe have become an alternative to securing bank loans.<\/span><\/strong><\/p>\n

Please support the crowdfunding fundraisers from these local businesses:<\/strong><\/span><\/p>\n

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The L.A. Standard Newspaper needs your support so that we can continue to create positive stories about Black communities. -Jason Douglas Lewis, Owner\/Publisher<\/strong><\/figcaption><\/figure>\n
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The Los Angeles Standard Newspaper<\/strong>– https:\/\/www.gofundme.com\/f\/support-blackowned-los-angeles-standard-newspaper<\/a><\/span><\/p>\n

Malik Books<\/strong>– https:\/\/www.gofundme.com\/f\/support-us-doing-this-pandemic<\/a><\/span><\/p>\n

Who’s Hungry Restaurant and Catering<\/strong>– https:\/\/www.gofundme.com\/f\/who039s-hungry-restaurant-amp-catering<\/a><\/span><\/p>\n

The Salt Eaters Bookshop<\/strong>– https:\/\/www.gofundme.com\/f\/help-establish-the-salt-eaters-bookshop<\/a><\/span><\/p>\n

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By Blake Carter<\/span><\/strong><\/p>\n

Black small business owners have historically had issues with securing funding from banks, and now Black entrepreneurs are struggling to stay in business during the COVID-19 pandemic.  Many Black entrepreneurs are turning to crowdfunding sites such as GoFundMe to raise the capital to start a business, expand an existing business, or to simply stay in business during the pandemic.<\/span><\/p>\n

A Los Angeles Times article titled “Black-owned businesses face a system set up against them.  COVID-19 makes it worse” cited a 2019 report from the Federal Reserve Bank of Atlanta study that showed that only 31 percent of Black-owned businesses received the funding that they applied for, compared to 49 percent of White-owned businesses in 2018.  Thirty-eight percent of Black-owned businesses did not receive any of the financing that they applied for, compared to only 20 percent of White-owned businesses.<\/span><\/p>\n

“If you can find another route I would suggest that,” said Asha Grant, who is opening The Salt Eaters Bookshop in Inglewood.  “Going to the bank for a business loan, not only do you have a small chance of actually getting one, because they see Black businesses owners as high risk because of racism.  But also I think for Black business owners you’re already up against so much financially.  Especially if it’s your first business venture.”<\/span><\/p>\n

Fundraising was the best option for Grant, and she chose to use GoFundMe because it was a popular crowdfunding platform that many people are familiar with.  Her goal was to raise $65,000 to open the bookstore on Queen Street, just east of Market Street.  Over 1,700 people donated to her campaign and she was able to raise over $82,000.  <\/span><\/p>\n

The social justice movement following the killing of George Floyd led to an investment in many Black causes and businesses.  Grant believes that contributed to the success in her campaign.  <\/span><\/p>\n

“We’ve seen an outpouring of support on GoFundMe this year for a diverse range of causes that are focused on racial justice and equality,” said Patrick Mahoney, GoFundMe senior communications manager.  “These fundraisers range from those helping the victims and families of injustice, to those supporting protestors, to those created by and for organizations focused on driving change, to those helping Black-owned small businesses.”<\/span><\/p>\n

Many entrepreneurs open and maintain their businesses with their own funds, but operating on a shoestring budget will only get them so far.  Without proper funding, they will be unable to hire employees, purchase equipment, properly market their business, or function as a well funded business.  <\/span><\/p>\n

“When I started the Los Angeles Standard Newspaper, I was doing a good 90 percent of the work and paying all of the expenses out of my pocket,” said Jason Lewis, owner and publisher of the Los Angeles Standard Newspaper.  “Four years later I’m still doing 90 percent of the work and the incoming revenue is just keeping the business afloat.  I started a GoFundMe so that I could hire people.  I can’t continue to do the bulk of the work and expect this business to expand.  I need to hire people so that the business runs more efficiently, and then this publication will be able to have a greater impact on the communities that it serves.”<\/span><\/p>\n

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