Many Black businesses fail because entrepreneurs who operate those businesses do not have sufficient “cultural capital.” Here, cultural capital means the practical knowledge and intangible qualities that accrue to individuals who comprise the households and areas of influence where entrepreneurship is part and parcel of everyday life.
In other words, entrepreneurship is an intrinsic component of the culture. If an individual has never participated in the entrepreneurial process, it is difficult to imagine just what it takes to be an entrepreneur. Therefore, when such individuals embark on an entrepreneurship journey, they may not be able to navigate the route successfully.
Ivan Light and Steven Gold (Ethnic Economics, 2000) are among experts who highlight the importance of cultural capital in successful entrepreneurship. Jorge Borjas’ Heaven’s Door (1999) is another book that discusses cultural capital. The fact that this topic has received considerable attention signals its importance in achieving success as an entrepreneur.
Therefore, if you are contemplating entrepreneurship, but have no cultural capital in this area, then you might reconsider. On the other hand, if you are about to start a business and have some cultural capital, you should evaluate whether your cultural capital is of the high-quality variety. That is, you must ask: “Has my life experience with business taught me what it takes to be a successful entrepreneur?”
The argument against all of this is that “we must start somewhere.” However, to build excellent and sufficient entrepreneurial cultural capital entire Black American families and areas of influence must study the science and art of entrepreneurship and then implement them effectively for an extended period.
It is often stated that what is unique to American culture is actually Black culture. Unfortunately, over the years, Black Americans have not absorbed a sufficient amount of America’s business culture. This is something that must change!
Contributed by By Dr. Brooks Robinson
Founder of, and primary contributor to, BlackEconomics.org