The Urban Service News
Tim Perez and his mother recently went clothes shopping at a northern California mall for an upcoming summer internship the teenager will work. It was a typical experience for mother and son—until it came time to pay for the items.
As his mom, Therese Perez, reached for her Mastercard, Tim stopped her.
“The bill was a couple hundred dollars,” Perez recalls. “But I pulled out my card and told her I had it. Knowing our financial situation at home, it felt really good to be able to do that. And I have been doing it for a while now.”
Perez, 18, was able to buy his own clothes because he has been earning his own money, and not by washing cars, scooping ice cream, or doing what teens typically do for income. Instead, he launched his own custom website development business, T Perez Designs.
The recent San Leandro High School graduate says he has 10 new clients since incorporating his company, with a vast list of potential customers interested in his services.
Perez learned the fundamentals to start and manage his company while still a teenager through NFTE — the Network For Teaching Entrepreneurship. This non-profit was founded in 1982 by Steve Mariotti, a native of Ann Arbor, Michigan, who previously overcame dyslexia, served as a Ford Motor Company executive, and taught special education in Fort Apache, The Bronx. Literally headquartered on Wall Street, and with operations in the District of Columbia, 12 American states, and 10 foreign countries, NFTE inspires low-income youths to achieve in the classroom and understand the value of being committed employees and dedicated business owners.
Missions: accomplished — hundreds of times over.
“NFTE empowered me to start my own business and educated me on how to run it, how to build a business plan, marketing, finances, you name it,” Perez says. “It literally built my fundamental understanding of business. Without NFTE, I would still be trying to find myself. With NFTE, I’m able to buy my own clothes, help pay my college tuition, and support myself when I get to college. Not a lot of teenagers, especially from my neighborhood, can say that.”
Likewise for Amber Liggett of Beaver County, Pennsylvania. She started a balloon-making business when she was just 9. But her years with NFTE exponentially increased her company’s profits and legitimacy. NFTE named Liggett Global Young Entrepreneur of the Year in 2011 for her enterprise, Amber’s Amazing Animal Balloons. At the awards ceremony, she met NBA legend-turned-renowned businessman Magic Johnson.
Liggett, now 19, also was named Black Enterprise’s Teenpreneur of the Year and was featured on PBS’s award-winning television show, Bizkid$.
Amber and the hundreds of her fellow NFTE graduates are relatively rare across America. Few inner-city residents — youths or adults — own businesses. There are two million black-owned businesses in the U.S., according to the Census Bureau. But there are more than 28 million businesses in America, by the Small Business Administration’s count. These numbers crystalize the imbalance that NFTE labors to correct.
For all of NFTE’s commendable work, prospective black business owners still confront obstacles. Some are embedded practices, such as difficulty in securing financing, enduring higher-than-normal interest rates on loans, and contending with limited access to financial-networking fora. Other challenges are societal, such as a lack of family wealth and a paucity of proper training on company management.
A 2010 report by the U.S. Commerce Department’s Minority Business Development Agency (MBDA) found:
- Among firms with gross receipts over $500,000, 52 percent of non-minority-owned firms received loans, compared to just 41 percent of minority-owned companies, the Survey of Small Business Finances indicates.
- Minority-owned firms paid an average of 7.8 percent interest on commercial loans, versus 6.4 percent for non-minority-owned firms. Among firms with gross receipts under $500,000, minority-owned firms paid an average of 9.1 percent interest. Non-minority-owned firms paid 6.9 percent.
- Average new equity investments in minority-owned firms equal just 43 percent of similar capital infusions into non-minority-owned firms.
Wise people debate whether these disparities are due to ethnic bias, higher financial risks among minority borrowers, both, something else, or all of the above. Regardless, NFTE has spent 26 years trying to narrow these gaps.
Carolyn Brown, Black Enterprise magazine’s, small business senior editor, believes the tough times could get better sooner rather than later. Major corporations including American Express, Coca-Cola, Goldman Sachs, and Google are offering or developing programs designed to help minority businesses grow.
“The challenges for emerging African-American business owners continue to be access to capital, finding resources,” Brown says. “Generational wealth is not something we have been able to attain and pass on to help start businesses. And nine out of 10 times, we have to find the capital to start businesses.
“Also, less than 1 percent of venture capital money is going to startups of emerging companies by blacks. And we’re not getting a steady bankroll, as are our white counterparts.”
Many NFTE graduates have benefitted from its cutting-edge teaching techniques. Virtually all of them stay connected with an organization that set them on their individual paths to success.
“When I think of where I am and where I’m going,” Tim Perez says, “I think back to NFTE. I call it my roots. I think we all do.”
Read Next- How To Get Help For WP Website