AEO’s Tapestry Project, funded by a $1.15 million grant, fuels Black entrepreneurship and helps level an inequitable playing field for Black-owned businesses in five U.S. cities.
Business • Association for Enterprise Opportunity
Studies have shown that Black entrepreneurs face a variety of hurdles: They tend to have less money to invest in their businesses and less access to loans than other groups, and they face a “trust gap” that makes sustained success difficult.
It’s a holistic problem that required a holistic approach. So when the Association for Economic Opportunity (AEO) received a $1.15 million grant in 2017 from the W.K. Kellogg Foundation to explore solutions to those challenges, it knew it wanted to do more than simply provide grants or loans to individuals. Instead, it created the Tapestry Project, which is designed not just to support individual startup businesses but also to create ecosystems where multiple stakeholders come together.
We have to work now more than ever to ensure that Black-owned businesses have equitable access to resources and funding.
AEO pursued those goals in two ways. First, it developed an online registry of economic development projects that are of particular interest to Black entrepreneurs. Second, it developed a program called Action Lab, which, starting last year, has provided grants to organizations in five cities to help develop those ecosystems. For instance, in Detroit it partnered with two organizations, FoodLab and ProsperUs, to develop entrepreneurs in the food industry through mentoring and loans.
That project in particular had the kind of side effect that AEO was hoping for. “One of the milestones for that collaborative is that it scaled,” says Hyacinth Vassell, vice president of innovation engineering at AEO. “It helped develop another collaborative, FoodLab Chicago, which is doing the same thing for food-based businesses there.”
Other Action Lab initiatives include an effort to preserve Black-owned businesses in gentrifying neighborhoods in Atlanta; a partnership with financial institutions in Minneapolis; partnerships with two historically Black universities in Raleigh, North Carolina, to support innovation projects; and a funding program for entrepreneurs in New York City.
The coronavirus pandemic, Vassell says, adds a layer of urgency to the projects. “We have to work now more than ever to ensure that Black-owned businesses have equitable access to resources and funding,” she says. “Prior to COVID-19, Black-owned businesses already did not have equitable access to resources and funding. So when you put a pandemic on top of that, they are now even further away from the table.”
One virtue of the Tapestry Project is that, because it addresses a range of businesses, it’s helped stoke collective responses to the pandemic. The Detroit and Chicago programs, for instance, have pivoted from loans and basic training on running food businesses to developing innovative ways to survive in a disrupted food-service economy.
“A lot of the focus now is on how they have to do business differently,” she says. “How do you generate revenue, build a digital presence, and diversify revenue streams? Are there different retail products you can offer? What can you provide for people who are staying home? Can you be a kind of grocery store for what you had been using and purchasing wholesale? Those are some of the things that they’re working on now to help businesses respond and stay resilient.”