Twenty years ago, in 2001, Cincinnati police shot and killed Timothy Thomas, an unarmed Black teenager. Fifteen Black men had died in Cincinnatti at the hands of police between 1995 and 2001. In response to Thomas’s death, protestors marched, and the protests turned into riots.
The riots eventually faded. But anxious civic and business leaders had formed the Cincinnati Community Action Now Commission to address the racial tension — including, they decided, by trying to close the wealth gap. Two years later, they had a plan: start an accelerator to support the city’s Black business community.
Now with a 20-year-long growing body of evidence that the initiative is working in Cincinnati to grow Black and Latinx-owned businesses, dozens of other cities are reaching out for guidance to replicate the program. Cincinnati leaders say they hit on two keys to creating meaningful change:
- Focusing on growing large Black and Latinx-owned firms (ones already bringing in at least $1 million in revenue) allows those firms to become significant players in their industries, potentially as suppliers to public companies. It also has created jobs and a cycle of more diverse hires.
- Putting the program within the Chamber of Commerce, rather than establishing an independent entity, allowed Black and LatinX businesses to be at the center of the white establishment business community.
Over the last few months, the Cincinnati USA Regional Chamber’s Minority Business Accelerator has gotten dozens of inquiries from other sites, according to the accelerator. “A national hunt has taken place to find models of where communities have grown larger-scale, Black owned businesses,” its director, Darrin Redus said. “That hunt elevated our work nationally.”
The accelerator’s main goal is to support larger-scale, Black and LatinX-owned firms across 15 counties in southwest Ohio, northern Kentucky and Southeast Indiana so they can continue to grow. The programs have been successful — the accelerator’s portfolio of 70 Black and Latinx-owned businesses in the region has created more than 3,500 jobs and generated over $1 billion in revenue combined over its 18 years, a June 17 Brookings Institute article notes.
Cincinnati has become a top city where minority entrepreneurs are succeeding — a 2019 Lending Tree analysis ranked the city 10th in the country overall. Of those 10, Cincinnati has the highest percentage of minority-owned businesses with more than $500,000 revenues and the highest percentage of minority-owned businesses in operation for more than six years.
The attention to larger firms is intentional, as Black and Latinx-owned firms tend to be smaller than white-owned firms, Redus said.
“Think about what’s happening in corporate America and has been for years where corporations are continually consolidating their supply chain, which means that they do more business with fewer vendors, those that remain have to take on larger projects in broader geographies, etc, which completely flies in the face in many respects of doing business with very small companies,” Redus said. “So you have to have some element of scale, if you’re really going to do a better job of diversifying supply chains.”
The accelerator also works to attract Black and LatinX- owned firms to the area, help minority entrepreneurs grow companies with high-growth potential, and assist Black and Latinx entrepreneurs in acquiring companies.
In 2019, the accelerator helped entrepreneur Ben Moore during his first acquisition. He was looking to acquire ATMOS360, a manufacturing company that was bringing in $5.1 million in 2017 before going bankrupt, at a public auction.
“The Minority Business accelerator was one organization that we leaned on for some advice through this type of asset sale,” Moore said. “Since then, they’ve also provided assistance on getting grants from the state of Ohio, as well as helping us find and evaluate potential acquisition partners that complement ATMOS’ business.
Now he’s the owner of the company, which was previously owned by former Procter and Gamble executive Icy Williams and was a Minority Business Accelerator portfolio company for years. In this case, the company remained in Black ownership, but the accelerator’s goal is to help Black and Latinx entrepreneurs acquire white-owned companies.
Being a part of Cincinnati’s Chamber of Commerce has been key to the accelerator’s prominence and reach, Redus said. It’s also what makes the program unique– many minority accelerators are outside of a city’s chamber of commerce. Instead, the Minority Business Accelerator is at the center of the Cincinnati business community, which in turn puts diverse founders in decision-making conversations.
Redus hopes to create another 3,500 jobs and generate another $1 billion by 2024 in the Cincinnati region, a goal he set when he became director in 2016. The timeline has had to be modified from the original goal of reaching this by 2022 after the pandemic slowed down progress.
In 2018, the Boston Chamber of Commerce launched its Pacesetters Initiative, which aims to increase business opportunities for people of color by pairing Black and Latinx entrepreneurs with chamber member organizations. It cited the Minority Business Accelerator as an inspiration for its program, which has since expanded statewide. Redus notes programs in Greenville, South Carolina and Tampa Bay, Florida, were also inspired by Cincinnati’s program.
Two years ago, the program caught the eye of the Kansas City-based Ewing Marion Kauffman Foundation, which provided $450,000 for the accelerator, part of which the accelerator used to create a playbook for how to run its program, Redus said. [Disclaimer, Times of E is sponsored by the Kauffman Foundation]. It’s come in handy; this playbook is what the accelerator sends to the cities reaching out, along with as much support as they can.
Now the accelerator is seeking additional funding in order to adequately provide these municipalities with extensive information without diluting the time spent growing Cincinnati’s firms, Redus said.
This story and others on New Builders Dispatch are made possible by a sponsorship from the Ewing Marion Kauffman Foundation. The Ewing Marion Kauffman Foundation is a private, nonpartisan foundation that provides access to opportunities that help people achieve financial stability, upward mobility, and economic prosperity – regardless of race, gender, or geography. The Kansas City, Mo.-based foundation uses its grantmaking, research, programs, and initiatives to support the start and growth of new businesses, a more prepared workforce, and stronger communities. For more information, visit www.kauffman.org and connect with www.twitter.com/kauffmanfdn and www.facebook.com/kauffmanfdn.