1. Executive Summary

For much of its history, Rhode Island has been a challenging place for Black Indigenous People of Color (BIPOC) entrepreneurs. For a variety of reasons, the state’s BIPOC residents have faced significant hurdles in starting, managing, and growing new business ventures. And, as elsewhere across the country, these challenging circumstances have been worsened as a result of the coronavirus pandemic.

These legacies are reflected in the latest data on the state of BIPOC entrepreneurship in Rhode Island. BIPOC business owners currently lead around 7.4 percent of all Rhode Island-based firms, far below their relative population share and nearly half the US average. These businesses also account for significantly lower shares of employment and revenue. However, the demographics in Rhode Island are shifting and BIPOC populations are driving growth in Rhode Island. According to U.S. Census data, from 2010 to 2020, the White population in the state declined by nearly 4 percent, while all other ethnic groups combined increased by nearly 27 percent and Hispanic Origin (any race) increased by over 38 percent. This rapid shift in demographics presents an opportunity to invest in quickly-emerging business and consumer markets. In an effort to better understand these business trends, the Rhode Island Foundation and Rhode Island Commerce contracted with Camoin Associates to undertake a research project focused on building more inclusive, resilient, and successful entrepreneur ecosystems that provide world-class services and support to the state’s BIPOC business owners and aspiring entrepreneurs. This assessment builds on a number of previous initiatives, including RI Commerce’s Rhode Island Innovates 2.0 strategy, and includes a review of the latest data on BIPOC business, an assessment of existing business support resources, and a series of recommendations for building more inclusive and diverse ecosystems that help more local people start and grow new ventures. The landscape of support programs in Rhode Island is large and diverse; there is no shortage of organizations and programs that are in the business of helping small businesses and entrepreneurs. Yet, presence does not equal equitable access. BIPOC entrepreneurs find it difficult to access many support efforts, lack trust in program effectiveness, or believe that these programs are not open to them. In other cases, the mix of programs and support efforts may simply be too complex and confusing. Rhode Island is home to extensive capabilities in nearly all of the core ecosystem building block components, such as access to capital and business support services. While room for improvement always exists, strong capacity is in place. Our challenge is less about creating new programs and capabilities, and instead about concentrating on improving access, developing more customized outreach, and programming for BIPOC entrepreneurs, and in nurturing a larger pipeline of BIPOC talent to tap into these support networks and business opportunities. Rhode Island’s BIPOC entrepreneurs must be at the table as these efforts move forward, not in an advisory role, but as shapers and drivers of the inclusive ecosystem building efforts. This report comes at a propitious time as many important initiatives to build a more inclusive and resilient economy are underway in Rhode Island. Governor McKee’s Rhode Island Rebounds plan includes major new small business investments, Rhode Island Commerce is leading the rollout of many new financing tools, and a new statewide network, funded via the US Small Business Administration’s new Community Navigator Program, is leading a new effort to better engage and support BIPOC entrepreneurs.

As these efforts move forward, they should be part of a wider strategy that improves existing business support services, builds a more robust pipeline of new and aspiring entrepreneurs, and ensures that all Rhode Islanders can pursue their entrepreneurial dreams if they opt to choose this career path. Specifically, the report recommends targeted investments in several core areas summarized on the following page.

A note about terminology

When talking about race and ethnicity, we fully recognize that there is no ‘one size fits all’ vocabulary. The national discussion about which words are most appropriate to use when talking about individual racial and ethnic groups as well as ‘marginalized’ or ‘underrepresented’ people altogether is complex and evolving. For this report, the consultant team, with advisement from the Steering Committee, uses ‘BIPOC’ when talking about Black people, Indigenous people, and other People of Color as the overall population we’re intending to support through this work. Additionally, the Economic Data Analysis, which is summarized in Chapter 2 and provided in full in Appendix B, examines demographic and socioeconomic trends and experiences of individual racial and ethnic groups. When discussing findings from the data-analysis, we retain the terms employed by the originating datasource to maintain consistency with that data-source. In all cases, the words used are intended to acknowledge the experiences of the people in Rhode Island who are entrepreneurs, small business owners, entrepreneur-curious, investors, creators, etc. AND who identify with currently under-supported, and underestimated, racial and ethnic communities.

CORE ACTION STRATEGIES

CAPITAL | Develop new funding vehicles targeted to the needs of BIPOC-owned businesses. • A new Community Development Finance Institution (CDFI) focused on BIPOC-owned ventures • New investment pools targeted to BIPOC-owned ventures • Support for newer programs, such as crowdfunding platforms and BIPOC-led angel investor networks, to diversify funding sources available for Rhode Island-based entrepreneurs

WORKFORCE AND TALENT | Ensure that every Rhode Islander with entrepreneurial ambitions can get the training and coaching needed to start a new venture. • Require entrepreneurship training for all K-12 students • Expand entrepreneurship education options at community colleges • Expand availability of self-employment assistance programs

BUSINESS ASSISTANCE | Increase availability and visibility of technical assistance programs for BIPOC business owners and aspiring entrepreneurs. • Provide business concierge and wayfinding support to BIPOC-owned businesses • Create a new Business Builder Voucher program to help entrepreneurs access outside consulting assistance and support • Create and sustain a statewide Minority Business Support Coalition

SPECIALIZED INFRASTRUCTURE | Provide increased access to specialized support efforts such as business incubators and coworking spaces. • Locate new coworking spaces in neighborhoods and locations easily accessible to BIPOC residents • Increase commercial kitchen and shared processing facilities

COMMUNITY CULTURE | Create local buzz and excitement about entrepreneurship. • Expand availability of entrepreneurship education for all Rhode Islanders • Support regular event series to learn and share ideas related to innovation, creativity, and entrepreneurship

SUPPORTIVE REGULATION | Ensure “entrepreneur-friendly” state and local laws and regulations. • Create small business ombudsman position to address small business concerns • Improve training to local government staff on effective “entrepreneur-friendly” practices and programs • Continue ongoing state-level regular reform efforts

MARKET ACCESS | Help BIPOC entrepreneurs gain access to new markets at home and abroad. • Support a BIPOC Business Accelerator program, as also recommended in RI Commerce’s Rhode

Island Innovates 2.0 plan to connect fast-growing BIPOC business to major corporate partners and customers • Support reform of current MBE/WBE programs • Develop a business succession program targeted to BIPOC residents and business owners