Black History Month survey: Legacy and community prevail against social and economic inequalities

Black small businesses continue to struggle with financial disparities that hinder their startup and success. 

More than half (57%) of Black respondents indicate that they were denied a bank loan at least once when they started their businesses. For non-Black respondents, this number drops to 37%. 

A third (34%) of Black business respondents report being denied a bank loan more than once—twice the amount (18%) of non-Black respondents.



Business motivations driven by financial need

Among Black respondents, the prevailing motivation for starting a business is financial need. More than two in five (47%) Black business owners report beginning in business to create additional and more lucrative income streams—the foremost influence for Black business owners. This is a stark contrast to non-Black business owners, for whom wanting to be their own boss was the top motivator (67%) when venturing into business. 

Pursuing a brilliant business idea was a close second (45%) in the motivations behind entrepreneurship for Black business owners, demonstrating a need for the innovation of Black businesses to be supported and well resourced.



Higher startup costs for Black-owned businesses

At startup, survey data indicates a greater financial burden for Black business owners than non-Black business owners. On average, it cost Black respondents approximately $21,000 to start their businesses—$6,000 more than the average amount (roughly $16,000) needed for their non-Black peers.

Biggest financial challenges at startup

Overall, Black business owners report that the three biggest financial challenges they face when starting out are not understanding available loan and grant options (36%), taking longer than expected to save enough money (36%), and selling personal assets to raise money (36%).

Coming out of pocket for expenses 

Almost eight in ten (79%) Black business owners say they’ve had to pay expenses or employees with personal funds at least once in the last two years. Among non-Black business owners, this number dips to 65%. This suggests that Black-owned businesses are experiencing greater cash flow problems than non-Black-owned businesses.

Read more in the next section, A profitable outlook.

Despite the financial challenges facing Black business owners, 84% say being a business owner has improved their financial security—with a third (31%) of respondents reporting that owning a business has “significantly improved” their finances. Here, we see how entrepreneurship can be a gateway of opportunity and financial prosperity for Black business owners.



A profitable 2022

A significant majority (85%) of Black respondents were able to pay themselves in 2022.

Of those who were able to pay themselves in 2022, eight out of ten (81%) were able to pay themselves more than the previous year.

A profitable future

Coming out of a profitable 2022, a significant majority (79%) also predict a profitable 2023—with a third (34%) being “very optimistic” about 2023’s financial forecast.



Read more in the next section, Success in community.

Black business owners look to and invest in their communities to advance the progress of entrepreneurship and the Black community as a whole. 

Three in four (75%) Black business owners agree that successful Black businesses are critical for a thriving Black community.

The importance of a network

When experiencing difficulties in their businesses, more Black business owners (53%) choose a family member or friend who is also a business owner as the preferred resource to help them troubleshoot challenges. 



Giving back to the Black community

Survey results also show that a majority of Black business owners feel a strong connection between their business and their community with 94% reporting they feel a need for their business to give back to the Black community.



Volunteering personal time

On a personal level, Black business owners are pillars in their communities. A majority (88%) report having dedicated their personal time to volunteering in their local community at least once in the past year—with nearly a quarter (23%) saying they volunteer every week. 



Read more in the next section, Building a legacy. 

Black business owners see their success and lessons learned as part of a legacy to pass on for the prosperity of future generations.

Three out of four (75%) Black business owners think the next generation will experience less hardships than they have. 



Mentorship can push Black businesses forward

A considerable majority (96%) view mentorship of younger Black business owners as important for the advancement of successful Black businesses as a whole. 

A legacy of success

Similarly, 95% of Black business owners view their business’s success as important to the success of future generations of Black entrepreneurs.



Closing the divide

Evidence shows that the Black-white wealth gap could take over 200 years to close. Seven in ten (73%) Black respondents are optimistic that the divide will significantly decrease in the next 100 years.



Considering the support needed to help Black businesses succeed, Black business owners agree that more mentorship from other Black business owners and easier access to financing are the resources needed the most.



Intuit QuickBooks Black History Month Survey 2023

Intuit QuickBooks commissioned online surveys, completed in December 2022, of 2,000 (1,000 Black and 1,000 non-Black) business owner respondents in the US (adults aged 18+). There were 864 small business owners out of 1,000 Black respondents and 873 small business owners out of 1,000 non-Black respondents. The approximate average annual revenues are $96,625 for Black business owners and $76,537 for non-Black business owners. The average number of employees per business is 44 for Black business owners and 35 for non-Black business owners. Among Black business owners, 26% have 1-10 employees. Among non-Black business owners, 45% have 1-10 employees. Percentages have been rounded to the nearest decimal place so values shown in charts and graphics may not add up to 100%. Responses were collected in online surveys using Pollfish audience pools and partner networks with double opt-ins, random device engagement sampling, and post-stratification based on local census data to ensure accurate targeting and results. Respondents received remuneration.

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