Boston was ranked the number one most unequal city in 2016 (in this Brookings Institute report). The problem is not lack of skill, creativity or commitment. It’s structural inequity.
According to a 2015 Federal Reserve Bank of Boston report, there is an increasingly startling gap between the asset base of white and non-white households. The median net worth of white families in the metropolitan area is $247,500, while the median net worth of U.S.-born black families is only $8. Nearly twice as many black Bostonians are unemployed, their homeownership rate is less than half, and nearly four times as many black families are “unbanked.”
When a community has limited financial assets, it becomes extremely difficult for individuals in the community to start successful businesses. Most entrepreneurs depend on some degree of bootstrapping—they rely on their own savings and credit, turn toward friends and family for support, and create early sales through community relationships. This type of reliance on family and community during the start-up phase is nearly impossible when the asset base in the entrepreneur’s neighborhood is so diminished. That means many of Boston’s entrepreneurs of color can hardly get to the starting block.
That’s why we’re working to provide low-income entrepreneurs with an opportunity to build credit, access capital, mentoring and technical support, and leverage social networks beyond their own neighborhoods. We need to create a robust ecosystem of support for these entrepreneurs.