Conversations with Black entrepreneurs: What motivates entrepreneurship?
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February is Black History Month: an invitation to recognize, celebrate and honour the profound contributions Black workers have made to building Canada’s economy, politics and labour market.
For Black History Month 2024, we’re sharing a three-part series in which we outline some of the history of Black entrepreneurs in Canada, review what official data sources can tell us about the state of Black entrepreneurship, and speak to Black entrepreneurs about their experiences in the labour market.
This builds on our 2023 Black History Month series, in which we focused on the history of Black labour in Canada.
Part 3: Conversations with Black entrepreneurs: What motivates entrepreneurship?
The Black population of Canada is diverse and represents varying backgrounds, ethnicities, experiences and circumstances. In 2021, the Black community made up 4.3% of the population and was the third-largest racialized group in Canada.
In 2023, LMIC reported that Black Canadians were over-represented in precarious, temporary and low-paying employment and underrepresented in high-paying managerial positions. We also found that, despite improvements in the labour market, Black Canadians continued to confront significant disparities in employment rates across age groups, revealing systemic challenges within the labour market.
In this article, we look at the labour market realities of Black Canadians and speak to 10 Black entrepreneurs about what influenced their decision to become entrepreneurs.
Black Canadians face higher unemployment, lower earnings
Racial discrimination may be the cause of these labour market inequalities
Discrimination is a significant factor in the persistence of racial inequalities in the labour market.
According to the Black Canadian National Survey (BCNS), which was designed to explore the experiences of Black Canadians across the country as well as the effects of racism on other non-white groups and is largely considered to be the first-of-its-kind, Black Canadians see workplaces as hubs of racial discrimination and unfairness. An alarming 75% of Black Canadians not only report encountering racism in the workplace, but perceive it as a widespread issue.
This perception extends beyond the Black community, with 70% of other non-white cohorts seeing workplace racism as a serious or severe problem while 56% of white Canadians believe it is a minor issue or not a problem.
Additionally, 47% of Black people surveyed believe an employer has mistreated them in terms of hiring, pay or promotion in the last year (compared to 15% of the broader Canadian population).
To deal with these unfavourable labour market conditions, Black people and other racialized groups may turn to entrepreneurship.1
Interviews with Black entrepreneurs: Labour market inequalities push entrepreneurs into business ownership
A standard method for examining entrepreneurial motivations is the push–pull theory of entrepreneurship (Gódány et al., 2021), which is widely accepted as an explanation for why people decide to become entrepreneurs (Okeke‑Ihejirika et al., 2023).
Push theories suggest that individuals are driven to enter entrepreneurship in response to unfavourable labour markets, such as job loss or difficulty in securing new employment, as well as dissatisfaction with their current job. In other words, the theory suggests that people create their own jobs when necessary.
Push factors include “the need to prevent or mitigate an unwanted situation or the desire to change a current business or situation for the better” (Bell et al., 2023).
While not all of the entrepreneurs we spoke to felt that unfavourable labour market conditions drove their decision to start a business, some did say that their perception of negative situations in the job market motivated them to embark on entrepreneurship.
For example, Marci—a second-generation Canadian whose parents immigrated from Jamaica in the early 1980s—founded a culturally sensitive psychotherapy wellness clinic that offers counselling, psychotherapy and coaching services for individuals, couples and families in the Greater Toronto Area.
According to Marci, part of the motivation to start her practice came from the pervasive anti-Black racism she experienced at other practices:2
When I first graduated and wanted to join an existing practice, mostly so I could enjoy the benefits and security of an established practice, I encountered a barrage of microaggressions and anti-Black racism. I wasn't new to racism, of course, but it became so pervasive that my own mental health was compromised.
I was determined to establish a safe haven, not only for my patients but for myself. I made the decision to open my own practice. I started off as just a sole proprietor offering counselling and psychotherapy myself, but I have been fortunate and have been able to expand my business into a more full-service type of clinic.
Similarly, Rodney, who started his own web design firm in Winnipeg in early 2022, said:
I had had enough of dealing with all the microaggressions, left-handed insults, and smiling through things that, outside the office, I'd probably handle differently. It was just too isolating, you know? Life's too short to be angry and uncomfortable for eight hours a day. I used to work in a place where it was all about a tight-knit group of “good ol' boys” drinking together and promoting only each other. It was like, if you weren't part of their crew, good luck getting ahead. The promotions seemed to happen at the bar instead of being based on actual work. That was it for me. I quit and started my own web design firm, where diversity and creativity actually matter.
Dwayne, who is in his late 30s and living in Toronto—where he is the proud owner of multiple recording studios and employs recording engineers and studio managers—shared that his motivation to venture into entrepreneurship stemmed from a desire to create an environment where he felt truly accepted:
I've been part of the city's hip-hop and rap scene for as long as I can remember. Music is my passion, even though I'm not an artist myself. Opening these studios just felt like a natural move. But what really fuelled this move was the constant feeling of not fitting into those predominantly white spaces. No matter how much I tried to code-switch or conform, it never felt like enough. So I thought, why bother? I wanted to create my own vibe, surround myself with people who truly understand me, where I can be myself, speak like myself, and just be.
The experiences of Marci, Rodney and Dwayne are consistent with research that shows that marginalized racial and ethnic groups are often confronted with labour market challenges that are rooted in racism and lead to discrimination, segregated job markets, and the devaluation or non-recognition of foreign credentials (Okeke‑Ihejirika et al., 2023).
From this perspective, individuals may be pushed toward entrepreneurship partly due to blocked labour market mobility.
The “blocked mobility” thesis sees entrepreneurship essentially as an escape route from unemployment, low wages or uncertain or limited labour market opportunities, giving “‘minorities’, who would otherwise have limited employment prospects, the opportunity to engage in local economic activities and become contributing members of their community” (Okeke‑Ihejirika et al., 2023 p. 3).3
As echoed by voices in our research and existing studies on the subject, entrepreneurship and self-employment “holds the promise that individuals’ career achievement will depend on their own qualities and efforts, and not on the prejudice of others …” (Piperopoulos, 2010, p. 142).
Beyond their individual encounters with racism and blocked labour mobility, many of the entrepreneurs to whom we spoke recognized the collective struggles of fellow Black individuals confronting similar challenges. This recognition fuelled their desire to overcome personal adversities and create opportunities that could uplift and support others in the Black community who were grappling with systemic barriers.
For example, Kendra, a young mother from British Columbia, began her entrepreneurial journey by creating a line of Black baby dolls and accessories.
Inspired by her daughters, Kendra's venture began as a way for her to celebrate Black beauty and make some money while she stayed at home with her young children, but it quickly turned into an opportunity to build a more inclusive and supportive work environment for everyone:
I jumped into this whole business not just as a side hustle, but as a way to genuinely do something for myself, something where I could use my creativity and drive but still allow myself to be a full-time stay-at-home mom.
For me, creating a line of Black baby dolls and accessories became my canvas, inspired by the beauty of my own daughters. I wanted them to see themselves in toys, you know, dolls that looked just like them. We had pretty good online sales right away, but things really started picking up, especially when we cracked into the US market.
It dawned on me that this was more than just dolls—it was an opportunity to craft a work environment that I wish I'd had during my corporate days.
I feel like I faced my fair share of racism and feeling silenced and overlooked in the past, and I saw a chance to create a better environment for someone else. So, when it came time to hire, bringing on a graphic designer for our packaging and branding and an e-commerce specialist for our online presence, it was so important to me that I had the opportunity to provide other Black professionals with the opportunity to thrive in a space where they could bring their whole, beautiful creative selves to work. It’s become about creating something not just for my girls, but for anyone who needs to see their worth and potential reflected back to them.
Similarly, A.J., a Haitian immigrant who settled in Montreal in the mid-1990s, faced persistent racism in the workplace until he decided to take control of his destiny by establishing a shipping and receiving company.
According to A.J., his recognition of the challenges that young Black men face in the labour market led to his efforts to provide opportunities for growth and empowerment:
I faced tremendous challenges—racist landlords refusing homes to Haitians, unemployment, police harassment. No one wanted to give me a chance, to just cut me a break—and those who did wanted to exploit me, giving me more hard labour than anyone else, thinking, "Just let the Black guy do it.”
Starting my own business wasn't just about me and my family, my own sons; it is kind of a mission to provide opportunities for young Black men. It was about tossing a rope for people who struggle for a fair chance. It's not just about giving them a job; it's about showing them their worth in a society that often tries to undercut it.
Interviews with Black entrepreneurs: Opportunities pull many entrepreneurs into business ownership
Consistent with other research in this area, some entrepreneurs who participated in our study did not perceive themselves as being "pushed" into entrepreneurship. Instead, they expressed a sense of being "pulled in" by a strong desire and capacity to provide ethnic or cultural goods or services.
Pull theories of motivation (opportunity-driven motives), in contrast to push theories, suggest that individuals are drawn into entrepreneurial activities by attractive and viable business opportunities in the external environment (Gódány et al., 2021).
In this context, “…entrepreneurs who have the knowledge of the specific needs and heritage of their co-ethnic consumers are allured to entrepreneurship and self-employment by moving into niche, saturated spatial markets that require low financial or human capital and are largely ignored by mass retailing enterprises due to security problems or low-purchasing power of the unattractive and poorer ‘minority’ areas” (Piperopoulos, 2010, p. 143).
Cultural, racial or ethnic-based needs, tastes and preferences for particular goods and services generate unique consumer demands and entrepreneurial opportunities that members of the group can satisfy.
For example, motivated by the belief that necessity is the mother of invention, Remona, a woman of Guyanese descent and hairdresser by trade, observed a gap in services to meet the Black community's needs: a lack of swimming pool-friendly hair products. She decided to try to fill that gap by creating a product and marketing it online. She said:
For me, it’s kind of a spin on buying local: if you shop within your community, there is a better chance that someone from the community is going to know what you want or need. I recognized a need because I myself experienced it. It feels really good to be able to offer my community something that they actually need.
Similarly, Keith, a second-generation Canadian with roots in Barbados, is the proud owner and operator of a club that offers skating and hockey lessons, catering primarily to the Black community.
Inspired by the skates he received as a gift from his uncle one Christmas, Keith learned to skate and play hockey on his own and now dedicates himself to making these activities accessible.
Recognizing that many parents in immigrant and underserved communities might not have the knowledge to teach their children these skills, Keith is passionate about providing opportunities for individuals to embrace hockey and skating. He firmly believes these activities hold significant cultural importance in Canada and strives to make them accessible to everyone:
I taught my own son how to skate and play hockey, but I couldn't ignore the widespread idea that these activities—and a lot of winter sports—were somehow not for people of colour. It struck me, you know, after talking to people I grew up with who never acquired these skills themselves, that many parents couldn't teach them to their kids. So I saw an opportunity to create a space where kids wouldn't be the only Black or kid of colour. That's why I took the initiative because, really, why not?
Likewise, Kwasi and Koko, a young married couple from Ghana who settled in a small but growing Ghanaian community in Nova Scotia, started their entrepreneurial journey driven by a simple craving: the taste of home (including spinach stew).
Disappointed by the lack of options offering the authentic flavours of Ghana, they decided to create a place where they and others in the community could savour the rich, traditional dishes they missed. Koko shared:
Our interest in starting this restaurant was fuelled by a longing for the familiar flavours of home-cooked Ghanaian dishes. We were inspired to establish a space for our community to connect; we ventured into the restaurant business. Recognizing that others in our community shared similar cravings, we saw an opportunity not only to satisfy their cravings and fill their appetites, but also to build a business that could generate income while fostering a sense of cultural belonging for everyone, including our children, in our adopted home in Nova Scotia.
In the literature on entrepreneurship and small business economics, the racial and ethnic identity of entrepreneurs and small business owners has been significant for understanding the journeys to entrepreneurship and clustering businesses in enclaves, niche market opportunities, and group resources (Orozco, 2022).
Consistent with this existing literature, the narratives of Remona, Keith, Kwasi and Koko illustrate that entrepreneurs can leverage their insider knowledge of the unique racial, ethnic and cultural preferences and the tastes and needs of their communities. Or in other words, “…business owners can tap into protected markets when they possess an insider’s knowledge of the special, culturally based tastes of their coethnics by providing services as middlemen or brokers to mainstream markets” (Orozco, 2022, p. 245).
Working toward a more inclusive labour market
The stories of the entrepreneurs we spoke to showcase the diverse motivations and aspirations within the Black entrepreneurial landscape across Canada.4
While some entrepreneurs were motivated by personal experiences of racism and barriers to labour market mobility, others were drawn by opportunities to fill gaps in their communities, offering culturally relevant products and services. These push and pull factors influencing Black entrepreneurs underscore the resilience, creativity and community spirit that shape their businesses.
As they navigate the entrepreneurial landscape, these entrepreneurs not only seek personal success, but also aim to empower and uplift their communities by creating spaces where everyone, regardless of race, can see their worth reflected and celebrated.
The drive to address unmet needs and achieve cultural representation and community connection forms the foundation for these entrepreneurs’ endeavours and contributes to a more inclusive and vibrant Canadian business environment.
Endnotes
1 It is important to note that very little is known about entrepreneurship among Black people in Canada. No studies focusing on Black entrepreneurs across Canada have been conducted to date. Existing studies focus largely on other immigrant groups, such as Chinese, Jewish, Korean and Asian Indian people in Canada’s three major “gateway” cities: Montreal, Toronto and Vancouver (Okeke-Ihejirika et al., 2023).
2 It is important to note that while an individual's motivation significantly influences their behaviour, it should not be viewed as the sole determining factor.
3 LMIC prefers the term "underserved populations" because it acknowledges the diversity within different ethnic or cultural groups and avoids potential negative connotations associated with the term "minorities." Our commitment is to foster language that respects the richness of diversity and promotes inclusivity.
4 While previous research has demonstrated the effects of socio-cultural influences on entrepreneurial motivation, particularly at the intersection of race and gender (Smith, 2017), several entrepreneurs we interviewed were driven primarily by the desire for profitability and the opportunity to work for themselves. It is crucial to recognize that the push and pull factors discussed here are not the exclusive motivations for Black Canadians to venture into entrepreneurship. Just like their counterparts of all races across the country, the reasons for starting a business are diverse and multifaceted.
References
Bell, M., Thach, L., & Fang, F. (2023). Examining motivations and challenges of black wine entrepreneurs using the push–pull theory of entrepreneurship. International Journal of Wine Business Research.
Gódány, Z., Machová, R., Mura, L., & Zsigmond, T. (2021). Entrepreneurship motivation in the 21st century in terms of pull and push factors. TEM Journal, 10(1), 334.
Okeke-Ihejirika, P. E., Nkrumah, A., Amoyaw, J., & Otoo, K. (2023). Black entrepreneurship in Western Canada: The push and pull factors. Journal of Global Entrepreneurship Research, 13(1), 17.
Orozco, M. (2022). The salience of ethnic identity in entrepreneurship: An ethnic strategies of business action framework. Small Business Economics, 59(1), 243-268.
Piperopoulos, P. (2010). Ethnic minority businesses and immigrant entrepreneurship in Greece. Journal of Small Business and Enterprise Development, 17(1), 139-158.
Dr. Suzanne Spiteri is a sociologist with several years of experience in both qualitative and mixed-methods data analysis. She leads labour-related projects that explore labour market tightness and the labour market outcomes of under-represented groups.