UK Black Business Week: Black founders encourage others to follow dreams of business ownership
This UK Black Business Week, 2-7 October, Start Up Loans, part of the British Business Bank, announces it has provided more than £73m of start-up loans since 2012 to businesses founded by Black owners.
10% of this total, almost £7.5m, has been provided to Black business owners in the last year.
Supporting under-represented groups
The Start Up Loans programme has a track record of providing access to finance to underrepresented groups. Since 2012, the programme has provided 9,534 loans to Black business owners – 9% of its total volume of loans.
In comparison, British Business Bank analysis of the UK SME Finance Monitor for the ten quarters to Q4 2022 found that around 2% of UK businesses are led by those from a Black ethnic group.
The British Business Bank’s 2020 Alone together: Entrepreneurship and diversity in the UK report found Black business owners face persistent disparities in business outcomes, with systemic disadvantage playing a key role.
Once a business has launched, Black business owners report substantially worse outcomes across many measures of success. Median turnover for Black entrepreneurs is just £25,000, compared to £35,000 for White entrepreneurs, while only half of Black business owners meet their non-financial aims, compared to 69% of White business owners.
That’s why Black business owners like Bolu Fagborun are passionate about improving access to finance for entrepreneurs from an ethnic minority background. Bolu, a 37-year-old former rugby league player for Huddersfield Giants, set up his courier business, Same Day Solutions, in Bradford in 2022. The business makes deliveries on behalf of companies and also fulfils contracts with larger courier services like CitySprint and DPD.
Success story: Same Day Solutions, Bradford
Bolu took a loan of £15,000 in April 2023, which he used to put deposits down on four new vans so the business could scale up and fulfil more orders. The business was set up in one of Bradford’s most deprived postcodes and has taken on three people from the local job centre as Bolu strives to provide help to those who need it.
Bolu said: “Through my past work with Fagborun Limited, I recognised that not enough people from ethnic minority backgrounds take out these loans. There are so many talented Black entrepreneurs out there who might be put off by the lack of available financing, when all they need to grow and succeed is the capital. Putting Same Day Solutions in the spotlight will hopefully provide other people with the proof they need that they too can access the finance they need to set up their own business, and to continue to scale and grow it.
“As well as lending money, Start Up Loans helped me come up with a really solid business plan, which is just as crucial to success. My advice to other aspiring business owners would be to give it a go; if you don’t try you’ll never know.”
Success story: Chapmans of London
Another Black business owner passionate about raising awareness of financing opportunities is Tolani Agoro. Tolani, 31-years-old and from London, came up with the idea for Chapmans of London at the end of last year. Her product is a non-alcoholic cocktail, famous in Nigeria but previously not widely available in London.
Tolani look out a loan of £16,500 in August 2023, which she has used to pay for the first production run, the ingredients, and to employ freelance support to help launch Chapmans of London in the UK, opening up a new market for her growing start up business.
Tolani said: “I love my heritage and I love fruity, sweet drinks, which led me to creating Chapmans of London. I spent the end of last year designing the concept and then have spent this year working on the recipe, sourcing ingredients and marketing ready for the launch. My dream would be for it to be available in more than one country, to see it in the US or take off in the UK would be amazing. I encourage anyone else thinking of going after their dream to go for it – and don’t let the small hiccups get in your way.”
Richard Bearman, Managing Director, Start Up Loans, said: “Start Up Loans is proud of how its programme consistently over-indexes in its delivery of finance to underrepresented groups, but there is still much work to do. It’s inspiring to hear stories like Bolu and Tolani’s and I hope it inspires other entrepreneurs to take the leap into business ownership. As well as the funding, we also offer business mentoring to support business owners and give them more chance of succeeding. We encourage anyone with aspirations to own a business to research their financing options and see whether Start Up Loans can help.”
The British Business Bank will be at the UK Black Business Show on Saturday 7th October.
