There are a lot of steps that come with starting your own business, ranging from mapping out a business plan to securing funding.
Having a clear path can help set you up for success. While it can be an arduous process, there are plenty of loan and grant options available for minority-owned businesses to help make the journey easier.
Steps to Starting a Business
Creating a business from scratch can be a daunting task, especially if you don’t know where to start. There are plenty of variables involved and the whole process can feel a bit overwhelming.
For that reason, it may make sense to start with some of the most simple decisions and then build out from there.
One of the first steps to starting a business is determining why you are doing this in the first place and what motivates you. At the end of the day, not everyone wants to become a business owner for the same reason.
You might have an idea for a product or service that you want to put into action, for example, or maybe you want the flexibility and empowerment that comes with working for yourself.
Determining your “why” will go a long way in mapping out your next steps.
Once you have a handle on why you want to start a business, you can dive deeper into the ideation phase.
You may already have a clear-cut plan for the business that you want to build, but many other people may only have a vague idea or might even still be at square one.
When coming up with potential business ideas, it can make sense to focus on your areas of experience and your skillset. What talents or lessons from your previous jobs can you use as a foundation for your new business?
Using your background to find your idea can be a lot simpler than trying to jump into a field that you have no experience or knowledge of.
Drawing from experience can also make the process more manageable. There’s always a learning curve when it comes to something as serious as starting a business, but working within a space that you already understand can make the process much more attainable.
Creating a business plan
There are a couple of different ways to go about building a business plan, where you lay all your cards on the table and map out exactly how your business will be built and function.
According to the U.S. Small Business Administration, there are two main types of business plans: traditional plans and lean startup plans.
With a traditional plan, you will get very detailed with the goal being to map out all aspects of your business and miss nothing. This will include things like how your company will be organized, market analysis, employees you will need and a plan for financial viability.
A well thought out and documented plan can help you to stay on track through the twists and turns of business ownership.
Your other option is the lean startup plan, which is useful for more simple businesses or ones that you want to get up and running right away.
It’s much more compact and could be a good choice if you plan to more intuitively grow your business and make decisions in the moment.
Many businesses naturally need initial funding to get off the ground, and determining where those funds are coming from will be a huge part of starting your business.
It may be easiest to break down sources of funding by your internal and external options.
Internal options are ways that you can go about funding yourself. You may have cash on hand, investments you can tap into or other sources that allow you to fund your business all on your own.
Externally, you may look into finding a loan to fund your business. If you opt to go down this path, keep in mind that the federal government itself does not provide loans or grants for businesses.
Another external option to consider is crowdfunding, which usually involves advertising the eventual product or service your business will provide and soliciting upfront payments or donations toward your business.
Popular crowdfunding websites include GoFundMe and Kickstarter.
Loans and grants for minority business enterprises
There are a few different ways to go about looking for loans and grants specifically aimed at minority-owned businesses. One path is to check local options available where your business will be based.
Many states and cities have robust local offerings. The Florida Department of Commerce, for example, offers access to minority business programs as well as access to the Black Business Loan Program.
Check your local or state offerings to see what options you may have.
Nationally, Grants.gov is a useful website that can help you search for available grants to apply for.
Large banks and legacy financial institutions may also offer options specifically for minority-owned businesses.
Bank of America launched its Small Business Down Payment Grant Program in 2022 with the goal of supporting minority-owned business growth.
Related reading: Grants for Women & Single Mothers
Getting Your Business Certified as Minority Owned
One step you may want to take with your new business is getting it certified as minority owned. This can help grow your business’s profile and connect you with strong resources.
You should look into potential local certifications available where you plan to start your business.
According to the U.S. Chamber of Commerce, the main national certification body for minority-owned businesses is the National Minority Supplier Development Council (NMSDC).
Certification requirements include being a for-profit enterprise that is at least 51% minority owned. After providing info such as business statements, tax returns and resumes of the owners as part of your application, your business can be certified.
Resources for Women
There are plenty of resources available for women who own small businesses, ranging from useful information to potential partnerships.
One good place to look is the Small Business Administration, which offers access to a lot of great info. This includes everything from topics such as funding to women-owned small businesses to links to additional resources.
Also available through the SBA, the Office of Women’s Business Ownership offers training, counseling and other resources for women.
SCORE is another strong resource for women business owners, providing access to events, webinars, workshops, mentors and more.
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