We’re right in the middle of the holiday shopping season, which is why it’s the perfect time to think about where our money is going, and what kinds of businesses we’re supporting. Consumers have made it loud and clear that we care about a company’s values: A recent Harris Poll survey found that 82% of shoppers want a brand’s values to match their own, and they’re not afraid to vote with their wallets.
We know just how powerful it can be to use our money to stand up for our values — at HerMoney, we love to spotlight women-owned and Black-owned businesses. Black-owned businesses contribute over $200 billion to our economy every year, but only 1% of venture capital funding in the U.S. is given to Black entrepreneurs. 17% of Black women are in the process of starting a new business, but with lack of access to funding, only 3% of those women are still running their businesses at the five-year mark. This inequality in business and entrepreneurship feeds into the overall wealth gap between white and Black families: according to data from the Federal Reserve Bank of St. Louis, the median white family has $184,000 in wealth, compared to just $23,000 for Black families.
In this episode, we’re talking about how we can close these gaps by helping Black-owned businesses succeed. And we’re doing it with LaToya Williams-Belfort, the executive director of the Fifteen Percent Pledge — a not-for-profit that has called on major retailers to dedicate 15% of their purchasing power to Black-owned businesses. Since it was founded in 2020, 29 companies have committed to the Pledge, including Sephora, Macy’s, Gap, Madewell, and West Elm. The Pledge has helped more than 600 Black-owned businesses connect with those retailers.
Listen in to hear Jean and LaToya talk about the origins of the Pledge, and what it really means for corporations to support the racial justice movement. LaToya describes working with the first Pledge-taker, Sephora, to sustainably grow their investment in Black-owned businesses. She also explores how “compassion fatigue” in the years since 2020 has made the work more challenging — and all the more important.
Despite those challenges, the Pledge has shifted almost $10 billion in revenue to Black-owned businesses through retail partnerships. We talk about and celebrate just a few of the Black-owned brands that have flourished through the Pledge, including Estelle Colored Glass and BLK & Bold Specialty Beverages (both of which, by the way, make great holiday gifts).
LaToya also reflects on the Pledge’s goals as the organization enters its third year, plans to attract big-box retailers, and new efforts to put money directly into the hands of Black entrepreneurs. Tune in to hear more about the Fifteen Percent Pledge Achievement Award, which will provide a total of $250,000 in funding to three Black-owned businesses in 2023.
In Mailbag, we hear from one listener who wants to get her nieces into investing. Another asks about the pros and cons of I-bonds. And in Thrive, a beginner’s guide to donor-advised funds.
This podcast is proudly supported by Edelman Financial Engines. Let our modern wealth management advice raise your financial potential. Get the full story at EdelmanFinancialEngines.com. Sponsored by Edelman Financial Engines – Modern wealth planning. All advisory services offered through Financial Engines Advisors L.L.C. (FEA), a federally registered investment advisor. Results are not guaranteed. AM1969416