Dr. Ruben Anthony on the state of black business
You may have recently read the National Urban League’s 2017 State of Black America Report or Urban League of Greater Madison Dr. Ruben Anthony’s recent assessment of the state of black America where affordable health care, unemployment rates, and disparities in education and poverty are major themes and areas for action. Since the Urban League is integral in Madison’s business community, I sat down with Dr. Anthony to get his insights about the state of black business in Madison. Here’s what he had to say:
Deborah Biddle (DB): What do you see as the most important issues for the business community and people of color who are in business in Madison?
Dr. Ruben Anthony (RA): Okay. So, I’m going to say this. The most important issue facing African-American businesses in Madison is that we have an underdeveloped ecosystem in all the things that support African-American businesses — from our civil rights programs at the city, with the county, out of the state or with WWBIC (Wisconsin Women’s Business Initiative Corp.). All of those things really help businesses start up, sustain themselves, and scale up. I say that because I’ve been to places where you see the ecosystem working much better than it’s working here. In Milwaukee, it’s a little bit broken, too, but when you go to cities like Atlanta, Chicago, and Washington, D.C. those factors are working.
DB: Why do you think it is the way it is here?
RA: I think that over time it’s eroded. People are critical to making it work — people in the agencies, city, state, and even the supply diversity folks in the private sector. For folks that are doing business with government, it’s business enterprise, EDE (economic development and enterprise), small business enterprises, or women-owned business enterprises. Those things have to be working. People make those systems work. The people who hold those positions make those systems work.
The other piece is that our African-American chamber really needs to develop a little bit more. Now, we have some splitting of the chambers. You’ve got the Black Chamber of Commerce and Heymiss Progress, and then you have Eric Upchurch starting his piece. So, as you talk to people, they don’t even know who is the keeper of the African-American business ecosystem. It’s hard to say who the keeper is. For African-American businesses to really thrive, all those things have to be working. We’ve got to have a good chamber. That chamber has to have a good relationship with the Zach Brandon and the Greater Madison Chamber of Commerce, and with MadREP. All those pieces have to be flowing together. In state government, city government, and county government, their civil rights areas where they do procurement also have to be working together. There needs to be coordination and outreach for startups, existing businesses, and expanding businesses. That is not working. The ecosystem is not working.
DB: Where does the onus lie to make it work?
RA: It’s a mutual responsibility. There’s not one coordinating agency in the city that is responsible for doing it and somebody needs to step up and be that coordinating agency. It requires a collaboration to make it work and that collaboration is not happening.
DB: I have just have been casually watching and I’ve seen the Latino Chamber come up and make all kinds of strides. I know that the Black Chamber has been around longer than [the Latino Chamber] but it’s really struggling. Is there a void of leadership or something else going on?
RA: No. No. I just think that the Latino Chamber understands that you have to have the collaboration and then you have to have consistency. You have to be active, doing a lot of things that businesses know about. You have to be relevant and have different activities that your constituents can get excited about. For example, the city has construction projects coming up. Somebody needs to be coordinating around that and having public conversations about how African-Americans, Latinos, and others will be involved. Somebody in the community has to take that initiative. We do play somewhat of a role, in that we mostly do the employment side of economic development. On the business development side, we’re waiting for the community and the different organizations to step up and do that. But it is an area that I watch closely because I spent a lot of my career doing that and I had the privilege of working for government during a time when it was working a little bit better than it might be working now.
DB: So, what would you suggest?
RA: I believe that you have to have the entrepreneurship-type spirit that Sabrina Madison has and you just have to do it. Whether it’s the Black Chamber or whether it’s her group or Eric’s group, you just have to make it happen. That’s what business is all about. I think it’s an opportunity for someone to step into that space and make opportunities happen — bringing African-American businesses together. Then bring a greater awareness of the different opportunities that are out here in the private sector. One of the other pieces that’s lacking is private sector collaboration, and even collaboration with Zach [Brandon] and those guys on the broader chamber. African-American businesses have to know that there are opportunities out there for partnerships. Some of the most successful cities are doing mentor-protégé-type efforts where a prime consulting or contracting business says, “Hey, I’m going to help that budding African-American-owned business grow,” and they help to make it grow.
I’m very excited about Gregory St. Fort at 100state. He’s doing a great job. A lot of startup businesses don’t really have a place to go and call home. I own two businesses. Before I came to the Urban League I ran a business from home, but I got tired of being in my home office so I would go to the coffee shops and other places. Well, now there are places where small businesses can go and they can get a cubicle or office or have shared space — types of facilities like 100state, StartingBlock, and Synergy Coworking. Those are the resources that I think that businesses need.
The other thing that we see is the need for access to capital. African-American owned businesses don’t really have a lot of access to capital. You start a business, you go into it, and you just don’t really have the resources to keep it going. You might have the expertise about how to do what that business does but you might be lacking the technical and administrative wherewithal to make it work, and then sometimes you might not be able to make it from payroll to payroll. So, you need to have access to capital — to cash. Businesses that don’t require a lot of cash up front could do well in Madison, but going into parts of the industry that really require a capital outlay to start the business is the area where business owners have struggled in Madison.
DB: Do you think the work that Eric Upchurch is doing to acquire startup funding for businesses is viable?
RA: I love the work that some of these millennials are doing because they don’t have any fear. Eric is creative with the different ways that he can raise money. The millennials are creative with funding, fundraising, using social media, and being unafraid to step out there. They’re non-traditionalists. They believe in walking in spaces that we haven’t walked in before. That’s going to be important for there to be more folks like Sabrina and Eric. I’m encouraged by the Black Chamber. They’ve just got to pull the collaboration together and find a way to bring some of the millennial energy back into that enterprise.
DB: What is your thinking with regard to young people, those who are high school and college?
RA: Clearly in Madison, a lot of folks have concluded that you have to get young people career ready. That doesn’t have to mean that they rush off to college. Maybe they fall into a trade or maybe go into entrepreneurship. As young people decide to go into the trades, they have a pipeline for starting businesses. If you can learn how to lay bricks, do carpentry, or how to do some of these trades, you have the ability to start a business. I am excited about trades again because college has become so expensive that young people need other alternatives. This is probably a better climate than we’ve seen in a long time for experimenting with starting businesses.
At the national level, people are being encouraged to become more entrepreneurial than in the past. In some of my research, I’m also seeing an emerging gig economy, where people take a short-term job or gig to earn money, from driving a taxi, cutting lawns, or starting your own transcription service. If you Google the gig economy, you will see a whole gig network of people hiring themselves out now. When you look at business literature, it indicates that 40% of the U.S. economy could move toward the gig economy over the next 20 years. So, there’s a change afoot right now where people don’t necessarily want to work for somebody else. They want to do their own thing.
DB: Are economists seeing that as viable for the breadth of someone’s working career?
RA: It could be. Or, it could just be a stopgap. There is potential for young people going into the gig economy. Some of them are going to explode and discover things that are really going to be foundational and really revolutionize how we do things.
DB: So, you have this partnership with MadREP. Is that just for the Madison Region Economic Development & Diversity Summit, or do you partner on other projects?
RA: We’re in partnership with them through the Madison Region Economic Development & Diversity Summit to help with continuing education and to encourage the crossroad between diversity and economic development. Throughout the year we continue that as we talk to businesses that are developing and help organizations get their diversity and inclusion efforts together. It’s not just a one-time deal. It’s a philosophy that both organizations have adopted and have agreed upon to work together to help change things.
For example, our board member, Nia Trammel, and Mayra Medrano of MG&E are working with A Greater Madison Vision to develop a 20-year plan for the region that is inclusive — not just in word, but also in deed. We’ve got diverse groups around the table developing that plan, which involves talking to churches as well as community leaders with the goal of gaining input about transit needs and other areas that impact our eight-county community. The approach incorporates the perspectives and feedback about what is important not only to Caucasians, but what’s important to minorities, what’s important to seniors, what’s important to those who ride bikes, and so on. It’s a mixed vision that talks about diversity and inclusion from the start.
DB: Who is going to manage this, or whom does it get presented to?
RA: It’s managed by the Capital Area Regional Planning Commission.
DB: Will it become an actionable document?
RA: It will become a document that will be the basis for city, county, and regional planning that people can look at and say, “Well here’s a plan that really took into consideration what’s needed in this region and across a bunch of different demographics.”
DB: So, if you are thinking about the future, what is the most optimistic thing to you from a business standpoint?
RA: The most optimistic thing is that young people are uninhibited. Millennials are uninhibited. They’re not afraid and they are risk takers. They jump into this new economy and they’re not afraid to try new things. I really like Ja’Mel Ware of Intellectual Ratchet. And again, I think about Sabrina Madison. Those two aren’t afraid to go into this new 21st-century economy to find their way. Both of them have left jobs, which is major.
In the past, I stayed on a job for 24 years. These young people are not going to stay on a job that long — not most of them. Most of them are in this new frontier. They’re social media savvy. They’re very articulate. They’re bright and they are unafraid. They are justifiably unafraid because they’re prepared. Many of them have got the skills that are necessary, whether it’s IT or public speaking skills — it’s a different group and I like what I see in that boldness.
DB: What’s the biggest challenge?
RA: The biggest challenge is economic instability in terms of the national safety and security, and international trading having a multiplier effect that adversely affects us locally. The biggest risk is isolating ourselves from the global economy. Right now, America and the world have changed to become a global economy. There’s no going back. There’s no putting the genie back in the bottle. We are a global economy. Technology has evolved to put us in a global market space. Our businesses have to keep up.
DB: For all of the people who are thinking about starting a business, or those who’ve already started and are struggling a little bit, what advice would you give them?
RA: My advice to anyone thinking about starting a business would be to not only pay attention to what that business would produce, but also how to manage that business administratively. A lot of times people who start and operate businesses don’t have the skills to manage them. They don’t know how to do the accounting or the marketing. They’re a good carpenter, plumber, or salesperson, but they don’t have the skills to do business management. Having the skills to do business management is important. Find out what resources are out there. Organizations like WWBIC, SBA, and SBDC may be able to help you do what is needed to effectively start and run your business. Make sure that you have enough money. Don’t leave a job until you have the cash flow to actually run your business and you’ve got enough money to run that business for six months or so.
The one thing that I’m finding is that we put a lot of emphasis on business start up and not enough emphasis on business retention — helping those existing businesses to stay around and scale up. Right now, it’s all about helping minority businesses start up, but the lost effort is on how we should be encouraging those existing businesses to survive, scale up, and become successful and larger businesses.
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