Rebuilding with Race in Mind: A Mini Case Study Share January 15, 2015 By Sarah Trent This is the first in a three-part series featuring Local Economy Fellow Crystal German. Below, read a mini case study of the Minority Business Accelerator Crystal runs at the Cincinnati USA Regional Chamber. The second installment features the story of Crystal, her journey into the BALLE Fellowship and Localism. The third looks at four businesses working with her Minority Business Accelerator that are creating impact and increasing economic inclusion in Cincinnati. Stay tuned for details on our March webinar focused on opportunity for all, which Crystal will moderate. In April 2001, an unarmed black youth was shot and killed by police in a minority neighborhood near downtown Cincinnati. The circumstances were considered questionable, and coming after years of incidents and mounting tensions between minority communities and the police, the city erupted into six days of civil unrest and protests that caused nearly $5 million in damage and launched a city-wide conversation about race disparities. It’s a familiar story, one that has repeated itself since the 1960s: Los Angeles, 1992. Cincinnati, 2001. Ferguson and Staten Island, 2014. In Cincinnati, civic leaders sat down to look at the conditions that made such unrest and anger possible: there was a lack of trust and relationships between some neighborhoods and police as well as clear disparities in what white and black communities were experiencing as far as access to education, employment, and wealth. Out of these conversations, the city launched a number of initiatives to address the various issues, including the Minority Business Accelerator at the Cincinnati USA Regional Chamber. There are 10 Fortune 500 companies in Cincinnati, explained Minority Business Accelerator (MBA) Vice President and BALLE Fellow Crystal German. So while many people in Cincinnati’s corporate circles were experiencing wealth, “for those outside the corporate arena there needed to be a pathway for them to grow companies, be successful, and then turn around and create all the positive impacts that we know come out of this: job creation, wealth creation, charitable contributions.” There needed to be a way to bring minority voices to the table, to make sure large corporations and anchor institutions would buy from local, minority-owned businesses wherever possible in order to lift up the entire community. “You can argue that everybody should have a voice, regardless of the size of their business or their background, race, or gender,” Crystal said. “You could argue that this should be an egalitarian society where everyone, just by virtue of breathing on this earth or breathing in this country, should have an equal voice. But the reality is that currently, that is not the case. So if your ability to have a voice, your ability to effect change is positively correlated to number of factors, then how do we improve those factors so that you can have a voice, so that you can create the impact?” Part of this is working with individual businesses, Crystal said, helping them grow and improve their operations so they’re big enough and capable of working with large institutions. Part of this is in educating corporations and institutions that the return on investment is different when you buy, say, toilet paper from a local minority-owned supplier versus buying from someone out of town. “A minority owned company is going to show up differently in general than a non-minority owned business,” she said. “And it’s not better or worse it’s just different, because that’s the power of diversity. They’re going to hire different people and they’re going to make different investment decisions with their dollars because of what their experience is in the community. If you have a diverse community,you want an empowered minority community. You want an engaged minority community. You want a wealthy minority community – because if you don’t, then the community is not going to grow to its full potential.” Thirteen years after the Cincinnati riots, the problem is far from solved – made even more clear by recent incidents in other communities – and the MBA is still only working with a fraction of the minority businesses in its region. But the MBA model is being adopted in other cities and progress has been made. Progress that Crystal said most folks would “take their hats off to.” Minority Business Accelerator 2001: Civil unrest and racial tensions prompt Cincinnati to examine underlying conditions and address them through community policing programs, education, and initiatives to increase wealth and opportunity in minority communities. 2003: The Minority Business Accelerator launches as part of the Cincinnati USA Chamber of Commerce, funded by the Greater Cincinnati Foundation. Their portfolio includes 20 black-owned businesses. 2004: Eight corporate and community partners (called goal setters by the MBA) spend more than $100 million with minority owned businesses. 2007: Six local minority-owned businesses become investors in the Cincinnati USA Regional Chamber to help fund the MBA. 2008: Crystal German named MBA Vice President. 2010: The MBA expands to include Hispanic-owned businesses after commissioning a Minority Business Community Assessment. 2012: Thirty-one corporate and community goal setters spend $771 million with local minority firms. 2013: Spending by goal setters at portfolio firms tops $1 billion. 2014: The MBA’s new L. Ross Love GrowthBridge fund, which aims to support growth projects of minority businesses, reaches their $2 million fundraising goal. How the MBA Works The MBA’s work is structured under three categories of focus: building and supporting minority-owned firms, connecting those firms with corporations and anchor institutions that need to purchase supplies or service, and growing local knowledge and conversations around the benefits of supporting minority businesses. Build: The MBA offers management consulting, tools, and resources to a portfolio of minority owned companies to help them grow in terms of revenue, number of employees, capabilities, and capacity, putting them in a position to then sell to corporations and anchor institutions. MBA employees are assigned their own firms, at which they serve as ad hoc employees, often with a seat on their advisory board. MBA staff help the businesses work through strategic decisions, financial planning, performance analysis, and can also help challenge assumptions and work through the details of decisions or ideas. Connect: As part of the Chamber, the MBA is in the business of relationships. So when a firm says they want to grow and start supplying something to, for example, a hospital, the MBA can make those connections. As an intermediary that has established relationships with both corporations/institutions and minority owned businesses, Crystal said “we are able to ask questions and get answers that probably neither one of those groups would be able to do if put in a room by themselves cold with no introduction or support.” Grow: By participating in an advisory capacity to other organizations and being in the room for various conversations about business, race, and economic inclusion, the MBA is working to change the conversation around these topics and grow an appreciation for the impact minority businesses have on the Cincinnati region. “We’re helping to make sure that when minority business owners walk into a room, the environment they’re walking into is as amenable to them being successful and having the right level of conversations as it can be,” Crystal said. And it’s not just being on the board of another organization: “It’s the role we play on that board, raising important issues and being an expert resource as an organization thinks about how it can engage in the minority community or the minority business community; how can it be part of the solution. It’s one thing to show up and be in the room and another thing to be considered one of the primary resources in this community for pushing, promoting, and elevating economic inclusion.” Factors for Success When talking about the success of her organization, Crystal attributes it to three main factors: “We are very clear about what our mission is and we have from the very beginning been very diligent about measuring our value and our impact.” This has allowed the organization to point to clear data that shows that they are doing what they aim to and being “good stewards of the resources that have been provided” to the MBA. “We have a great resource within the Chamber in our marketing folks. They have helped us to hone in on what our message is, how we communicate, what we communicate, where, and how often… making sure the right people hear the message at the right time.” “We did not set out to be a model. We did not set out to launch ourselves in other cities: we set out to make a difference here in Cincinnati. With our focus and measurement, we’ve been able to show what we can do in a community,” which has allowed others to tell the MBA’s story and decide for themselves how it might work in other places. Dig Deeper Read about Crystal’s experience as a BALLE Fellow and the story of how she came to this work in Cincinnati. Learn more about some of the minority businesses and community partners Crystal’s work supports, and the ways they are impacting the Cincinnati region. Learn more about BALLE’s vision of Opportunity for All and stay tuned for more details on our March webinar on this topic, which Crystal will moderate. Read about how Cincinnati and other communities have responded to racial tensions and protests from the 1960s through the 2014 incident in Ferguson in this report to the Ferguson Commission (PDF) in November 2014 and this Better Together Cincinnati report (PDF) from March 2011. Learn more about the Minority Business Accelerator by checking out their website or taking a peek at their 2012 and 2013 annual reports (PDFs).