Ron Busby, Sr., President, U.S. Black Chambers, Inc.
Ron Busby, Sr., shares his perspective on Gallup's report on lending to diverse segments and how it relates to USBC members.
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At Wells Fargo, we believe that successful small businesses are the foundation of a healthy, vibrant, American community. That's why serving small business owners is one of the most important things we do.
Yet we also know that many small businesses across the country, including those in diverse communities, are still recovering from the great recession. Serving diverse owned businesses is a priority for us, and we know that more needs to be done to help those businesses grow and prosper. It's also clear that we, as well as those who support small business in our country, need to better understand the challenges facing diverse business owners.
For this reason, we turned to Gallup to conduct a study working with the U.S. Black Chambers, the U.S. Hispanic Chamber of Commerce, and the U.S. Pan Asian American Chamber of Commerce Education Foundation. Gallup surveyed diverse business owners nationwide to better understand their motivations for starting a business, their funding needs, and their attitudes towards credit. We learned about how diverse small business owners addressed funding needs and their perception of financial institutions. We heard about their desire for resources, education, and tools to help their business succeed.
In this video, Ron Busby, Sr., President of the U.S. Black Chambers, shares his perspective about the study and how it relates to USBC members.
RON BUSBY, SR.:
As the President of the U.S. Black Chambers, Inc., I get the opportunity to go around the country and speak to business owners and chamber leaders around, find out what their issues are, what their concerns are. And many of the findings were the same that I've been hearing over the last five years. African Americans have had difficult times obtaining loans, understanding credit, and being able to apply that to the sustainability of our businesses as well as our communities.
These are all things that were found in the study, but more importantly what I found in the study is that there are opportunities to correct these, to improve those relationships, and to really move our businesses in the right direction. If we're being successful with the limited amount of resources that we have today, our future looks wonderful.
That's a good news story because I see now more African Americans are going into business for themselves. Historically, we have not gone to banks for loans or for investment capital.
And so for now, with us being able to have relationships with our financial institutions, this shows that there's trust, that we have a new energy and synergy of getting the funds that we need to start our businesses, to acquire new businesses, and to do joint ventures and mergers to get us to that next stage of small business growth across the country.
Historically, black businesses have gone to banks without a true relationship. They go to the bank when they have a deal. They go to the bank when they're trying to start a business, or they go to the bank when they need the dollars immediately.
In many cases, it's just that we don't have a banker in the bank that looks like us or that understands our challenges, or more importantly, we don't have a bank in our community at all. So we're forced to go outside of our community to establish a relationship with a banker that may or may not understand the challenges of our community that our business owners face, as well as the business owners themselves have had historically.
I think many African Americans don't really understand credit worthiness. At a young age, most of us aren't exposed to entrepreneurism. I was fortunate that my father had a business. And so I was able to see some of the challenges as well as opportunities that small business owners have. But this generation, many of them have not been exposed to that. I grew our firm from a five-employee janitorial service to one of the country's largest where we had 700 employees and over 22 million dollars in annualized revenue. And many of those opportunities came on those Saturday mornings with my father at the breakfast table talking about growth strategies, talking about expenses, revenue, and how to make good decisions short-term as well as long-term.
We tell folks all the time, "Create a board of directors. Create someone that you're accountable for and to." Bring as many experts to the table as you possibly can. Not your family members. Not folks that are like you. Not folks that respect you. But folks that are going to encourage you, hold you accountable, and more importantly, have developed the relationships over the years that may help you as a small business owner grow.
I think for black businesses to be successful, they need to go in proactively. They need to have established relationships with their bankers early on before there's an opportunity. When they're first thinking about starting a business, they need to start a relationship with their banker. They need to make sure that they have proper documentation, that they have good support around them, from accounting to legal to human resources, marketing and sales. Most small business owners go inside or with family members to give them the resources that they need.
The U.S. Black Chambers is taking on a nontraditional method. We've turned many of our chambers into micro lenders. And so now, you can go to, for instance, our chamber in Beaufort, South Carolina, where through the SBA, we provided them $350,000. And now they're making 5,000, 10,000 small business loans to businesses to start growing and expand their businesses. And it has proven to be extremely successful in Beaufort, South Carolina. And in 2015, we hope to roll that out to five other cities around the country.
Of the 250,000 small black-owned businesses that we represent, their future looks bright.