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Dr. Brooks Robinson

2 mins read

Why Black Businesses Fail (Part 5): Lack of Knowledge

In an unsophisticated and non-technological world, running a business is not rocket science. As I travel the so-called developing world, I see entrepreneurship thriving along streets and roadsides everywhere. All it takes is a spot to sell one’s wares, and business can boom. No special knowledge is required.

However, one entrepreneur’s success signals an opportunity, and other entrepreneurs join the fray soon. This competition, evolving sophistication, and modernization make it more and more difficult to be successful in business even in the developing world. Now consider starting a business in sophisticated and technologically advanced America where competition is robust.

Some entrepreneurs initiate a business because of their romantic image of being a business owner, or they start a business just to prove that they are capable of being an entrepreneur. However, before establishing a business they fail to study not only the science of business in general, but the science of business that is specifically related to the type of business that they seek to operate.

Starting a new business is surely not a case of “What you don’t know won’t hurt you.” It takes knowledge to start a new business, and one is well warranted in studying the science and art of business before setting out to achieve this goal.

What knowledges are basic prerequisites for business operation? Consider economics, accounting, finance, statistics, history, industrial organization, demography, psychology, information technology, logistics, and advertising.

It is not necessary that one have degrees in all of these fields, but a successful business operator must be knowledgeable in each field. In addition, entrepreneurs must be specialists in the goods and services that they produce and sell.

We all know that “knowledge is power,” and one will need all of the power that one can muster in order to be successful in business.

Contributed by Dr. Brooks Robinson


Founder of

2 mins read

Why Black Businesses Fail (Part 4): Insufficient Financial Capital

Starting a business can be viewed as a strategic game. Like all games that one intends to win, one must begin with a sound strategy. A key component of a business startup strategy is to have sufficient financial capital to promote the business to profitability.

Not operationalizing this strategy is akin to beginning a battle knowing that there are 10 kill targets, but having only seven rounds of ammunition. Such a situation seems doomed to failure, and generally is.

Why do entrepreneurs find themselves in this situation? Quite often, it is because of a poor business plan. That is, a business plan can be based on an inaccurate market study, the plan can overstate the potential market share that the new business might garner over the course of time, or a business plan’s proposal for price setting can be inconsistent with reality.

In these cases, the business plan leads the entrepreneur to believe that the financing required to initiate and sustain the business to profitability is less than what will actually be required.

Consequently, after the business is underway, the available financing and the revenues generated are insufficient to sustain the business to profitability, unless they contact a reputable business finance company to help them out. Belly-up it goes.

On the other hand, an entrepreneur can ignore the financing required to develop the business to a point of self-sustainability as dictated by a good business plan.

In his/her eagerness to start the business, he/she charges ahead knowing that there is insufficient financing—hoping for a miracle or that some other turn-of-events will prove the business plan wrong.

Too often, the business plan is proven correct, and the entrepreneur finds that he/she must close the business because there is insufficient financial capital to develop the business to the profitability point.

A fundamental key to business success is having sufficient startup financial capital. If you want to be successful, then find a way to find sufficient financial capital to initiate your business and sustain it until it is profitable.


Contributed by Dr. Brooks Robinson

financial capital

Founder of

2 mins read

Why Black Businesses Fail (Part 2): Insufficient Cultural Capital

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!

Black businesses

Contributed by By Dr. Brooks Robinson

Founder of, and primary contributor to,


-Tony Oluwatoyin Lawson

3 mins read

Why Black Businesses Fail: Discrimination from Black People

Part of Shoppe Black’s mission is to help reduce the rate at which Black Businesses fail. To help identify and understand some of these reasons, we’ve enlisted the help of economist Dr. Brooks Robinson for a multi part series entitled “Why Black Businesses Fail.” Enjoy and stay tuned for upcoming parts!

It is propitious to expound on the necessity for Black Americans to not discriminate against each other, to unite, and to reap the benefits of unification. For example, one noted social critic said: “Blacks should be like the so-called Jews. See how unified and successful they are.”

Another social critic responded: “That’s too much to ask. Jews have supposedly been around for thousands of years and have learned well the hard lessons of disunity.

Black Americans have only been around for 400 years—only 150 of those years free from chattel slavery. Give us another 500 years and see where we will be.”

The thinking of the latter social critic is logical. However, as learned people who can read the history of the Jews and know our own history, it is perplexing that Black Americans should take another 500 years to respond appropriately to the painful lessons of disunity.

What we know is that there are three primary reasons why Black Americans discriminate against Black businesses. First, some Black Americans simply hate themselves and everything Black. Second, some have been duped psychologically into thinking that “someone else’s ice is colder.” Third, some Blacks have experienced negative outcomes with Black businesses.

The first two reasons cannot be resolved by Black businesses—these are issues that can only be overcome by self-introspection by Black Americans.

However, the third reason can be rationalized. Simply put, Black businesses must ensure that their products and services are of the highest possible quality so that no aspect of business performance serves as a reason for Black Americans to discriminate against Black businesses.

The thinking is that few Black Americans discriminate for the first reason, and the number discriminating for the second reason is declining. Therefore, if Black businesses provide high-quality goods and services, discrimination should become less and less of a failure factor going forward.


Contributed by  Dr. Brooks Robinson

Black businesses


Founder of