Women of color who own Arizona businesses are on the rise
Wednesday, June 1, 2016
PHOENIX – Jenny Poon is a serial entrepreneur.
She runs the business collaborative Co+Hoots, where owners of small businesses, from tea suppliers to software design, share space, ideas and conversation.
Poon, the daughter of Chinese-Vietnamese refugees who emigrated to the United States to open a restaurant, learned early on about struggle and success.
“I remember thinking when I was growing up, ‘how is this even possible? Like they barely speak the language’,” Poon said. “If they can do it without knowing the language, without having the resources, without having funding, coming to this country with just a suitcase, I’m pretty sure anyone else can do it.”
Poon has fought and won battles for herself and others, contributing to a steady rise in Arizona businesses owned by women who are ethnically or racially diverse.
Still, women of color often have trouble getting financial backing, make less revenue, experience self-doubt, are judged as less capable than men and often lack the networks more readily available to non-minorities, according to studies and business owners like Poon.
And many believe the lack of opportunity for women of color is bad for business.
A 2013 study from the Harvard Business Review says that there is evidence that diversity in the workplace leads to innovation and drives market growth.
It’s a hopeful but bumpy rise in Arizona business ownership
Businesses owned by black women and Latinas in Arizona more than doubled over five years, according to a 2012 NWBC report. The number of businesses owned by Asian women rose by about 50 percent.
Another report, by American Express says Latina-owned firms in Arizona increased 119 percent from 1997-2014.
But businesses owned by Arizona women of color still lag in revenue.
Arizona businesses owned by white women in 2012 averaged $158,000 in annual revenue according to the NWBC report. But the revenue for businesses owned by Asian women averaged 80 percent of that amount, Latina-owned businesses averaged 30 percent and businesses owned by black women averaged only 20 percent, or about $34,000 annually.
And men still rule the business world. About ten percent of revenue in Arizona was generated by women-owned businesses in 2012, a fraction of that from women of color.
Women of color struggle to get financial backing
A Center for American Progress report says there has been “remarkable” growth in the number of women-of-color entrepreneurs. However, it also says that they still face barriers, such as limited access to mentors and exclusion from elite networks.
The report says that women of color have difficulty acquiring capital to start their own businesses, with financial institutions less likely to loan money to minority-owned small businesses than their white-owned counterparts. When they are given loans, the loans are often smaller, with higher borrowing costs.
Nearly half of African-American women businesses owners have faced trouble when trying to obtain financing for their business, the report says.
“The growth of women of color-owned businesses over the past two decades is especially remarkable given that women of color often partially fund their enterprises with their own funds, despite the fact that they tend to have much less personal wealth than both their male counterparts and white women,” the report says.
Evelynn M. Hammonds, professor of African American studies at Harvard University, says that women-of-color in STEM fields are often locked out of collaboration and mentor networks. She says that makes it harder to acquire capital.
“To build a tech startup for example…getting the venture capital is one of the largest and most difficult aspects of that, because the numbers of women of color are so small in these fields, they don’t actually have long-term mentors or supporters in those networks,” Hammonds said.
While Hammond says there has been progress on the issue, there is still wide disparities.
“It’s easier to do it than years ago, but at the same time it’s very difficult for women in general,” Hammonds said.
Fighting stereotypes and misconceptions
Some of the toughest battles female business owners of color face are with attitudes – their own and others’. Poon has been to business conferences where she has felt invisible.
“I’ve had instances where I’m sitting there and we’re having a discussion, and my perspective is completely overlooked,” Poon said. “It’s because there’s just a general bias and a general stereotype that women, and minority women in particular, don’t have a precedent in these different industries… And so the mind immediately thinks that that’s not the norm, and that those thoughts and ideas from that perspective aren’t valid.”
Women can also be put in a position where they feel they have to try harder to prove themselves, Poon said, which isn’t necessarily a good thing.
“We come in trying to be as strong and show that we can do this work, which then often results in us overcompensating, and that doesn’t help the initiative either,” Poon said.
Self-doubt will often plague business owners, Poon said, but they have to figure out how to quiet “the devil on your shoulder.”
Poon said women should realize they do not have to know everything.
“It’s “okay to fail and it’s okay to ask questions,” Poon said.
Changing to a diverse workplace
Business ownership will diversify when employees become more diverse, experts said.
“Seeing more minority women in leadership roles, in technology, in underrepresented areas, is how we’re going to change it,” Poon said.
Having more diverse workplaces can add a comfort factor for women-of-color, said Anita Blanco, director of diversity recruitment and engagement at Stanford University. She compared it to meeting someone from the same state.
“I’m from Ohio, so when I meet someone from Ohio, I’m like, ‘Hey Ohio!’, and we talk about Ohio,” Blanco said.
“Everyone likes to have some sort of comfort… that somebody understands them and that they feel welcome,” Blanco said. “But when you’re a person of color, usually a lot of times you literally stick out, because you’re different than everybody else.”
Poon, who says that her workplace at Co+Hoots as well as Eeko Studio has leaders and employees who are diverse in gender and ethnicity, believes that diversity is good business.
“Not only is the team diverse in race and gender, but also in perspective, in how they deal with conflict, in how they lead, how they communicate, and how they troubleshoot all of the different things they run into,” Poon said.
Helping to make a difference
Up and coming women entrepreneurs are getting help. Sharon Torres of Arizona State University organized the first-ever Women of Color STEM Entrepreneurship Conference in Scottsdale in May to encourage women-of-color to own businesses.
Poon offers a new, six-week Level Up program through her CO+Hoots collaborative for women-of-color entrepreneurs. For $99, participants will engage in through business education, training opportunities, technical assistance and mentorship.
“The goal of this program is to help women overcome a lot of that fear, to build confidence, surround themselves with women who have also done this before, launched businesses, and to essentially support them through every layer of growing their business,” Poon said.