Equal access to resources and funding would empower 10 times more entrepreneurs from the LGBTQ community in the U.S.
Meg is a small business owner and a part of the LGBTQ community. However, she finds it difficult to secure funds for her small business owing to her LGBTQ status. Her gender or sexual orientation should never be a factor that influences her business. But that is the harsh reality.
Startup and small business spaces can be immensely difficult, especially for the people of the LGBTQ group. Raising the initial capital (including the operational working capital) to build a small business is an uphill task. Furthermore, this is among those aspects of business where gay, lesbian, bisexual, transgender, and queer entrepreneurs face more significant challenges as compared to their heterosexual colleagues. This is because traditional loans are not always available to LGBT businesses.
However, recent times have witnessed progress toward greater diversity in entrepreneur funding, but there is still a lot of work to be done. If you are seeking funding as a member of the LGBTQ community and do not know where to start, this post can help you.
The number of LGBTQ-owned businesses is increasing, and their impact is grown from strength to strength. This article will teach you how to get funding for LGBTQ-owned small businesses.
Here are the points that we will be diving into:
- What is an LGBTQ-Owned business?
- What are some of the issues that LGBTQ entrepreneurs face?
- 10 Tips for getting Funding as an LGBTQ Business Owner
- Useful Tips for a Successful LGBTQ Small Business Owner
- Top 5 Recommendations for LGBTQ-Owners of Businesses
What is an LGBTQ-Owned business?
To be considered an LGBT-owned business, the enterprise must satisfy the following criteria:
- An LGBT person must own, operate, manage, and control at least 51 percent of the company
- Enterprise is self-contained from any non-LGBT business enterprise
- LGBT owners must be citizens of the United States or lawful permanent residents
- Enterprise is headquartered in the United States
- In the United States, Enterprise has been established as a legal entity
- Other than identifying as a member of the LGBT community, there are no requirements for the LGBT criteria. It is a purely subjective metric
What are some of the issues that LGBTQ entrepreneurs face?
We commonly read about the mistreatment doled out by the entrepreneur world to their gay population. This section takes us to some of the frequently faced issues by LGBTQ entrepreneurs.
Barred from collaborating, connecting, and commercial possibilities
All businesses thrive on networking. For a successful venture, business owners are required to vigorously connect and collaborate with their clients and customers.
This is another place where the LGBTQ community struggles to find a breakthrough. This could be observed in business meetings or networking seminars. LGBTQ individuals may feel alienated or stigmatized. In regions where conservatism reigns supreme, they are not permitted to have a voice among their heterosexual counterparts.
Prejudice while looking to lease or purchase space or office spaces
Once the background work is done, purchasing office space for the company is the next crucial aspect. It provides an identity to the business and is identified as the official and legal operational space of the business.
Obtaining a company or corporate office area may appear difficult for an LGBT business owner. The problem is that these are expensive and frequently need loans, so partnering with grant-giving organizations may not be realistic for a gay entrepreneur.
Finding Employees could be a problem
LGBTQ business owners could face a huge problem while hiring people to work for them. Not everyone is supportive of the community. While the scenario is gradually changing for the better, still, there could be some LGBTQ-owned companies that could not find cooperative with the gay community.
Finding Customers is another Issue the LGBTQ community faces
Just like the problem of hiring the right people for the job, seeking and building a clientele is as much an issue for the community. Prejudiced mindsets are present in every field; the corporate world is no different.
Such biased thoughts could find roots in certain religious beliefs that prohibit them from doing business with you.
Lack of Legal Protection from Discrimination
We have already learned about the common problems with which the gay community struggles. Despite all the discrimination meted out to them, there are no specific laws or legal protection offered to them. So, not only does the LGBTQ community have to deal with those problems, but they also do not have any legal rights to fight the inequity.
10 Tips for getting Funding as an LGBTQ Business Owner
Let’s get into the depths of the ways in which you can obtain financial funding for your LGBT business.
An angel investor is a person who contributes funds to a firm or a business startup in exchange for financial liabilities or ownership equity. They provide assistance to new small businesses and startups when most of the other investors would not want to support them financially.
SF LGBT Center
This LGBT institution in California is proudly associated with LGBTQ financing. It functions as a gateway between the LGBTQ community and the resources they need. This non-profit group assists people, including LGBTQ small business owners, by obtaining financial necessities. Besides, it also provides all kinds of other support, which includes an entrepreneur training program, imparting skills, and Queer Street Marketplace.
Furthermore, they also help with referrals to their well-established and far-stretched business development network.
Right from developing the business idea to providing aid to an already entrenched business, the SF LGBT center assists all kinds of businesses in overcoming their challenges.
StartOut is a non-profit organization that helps aspiring entrepreneurs. StartOut offers tutorials to its clients and assists LGBT entrepreneurs. It also provides a wealth of resources, including investors.
You can reach out to StartOut experts who can offer suggestions free of charge. All you need to do is sign up and log in to their portal. They also provide premium membership which aids in broadening your reach and further publicizing your business plans to interested prospects.
You may also seek out grants from online lenders, which is a common thing nowadays. Additionally, the process will move more swiftly than with the government grants. You can rely on their work ethics. Legitimate online lenders understand that their success is dependent on their reputation for keeping their customers' information secure and confidential. You can safely conduct your business with this type of loan company, and they may prove to be the best option for your company.
Join local business chamber for LGBTQ
Joining the local business chamber for LGBTQ could have various advantages for you. Being a member of your local business chamber allows you to expedite your contacts with financial institutions while also providing you with several educational opportunities. It is recommended you search out ways to get engaged and begin your journey to expanding the financial horizons of your startup.
Get a certification from NGLCC
The National LGBT Chamber of Commerce (NGLCC) is a non-profit advocacy organization based in the United States that focuses on strengthening economic opportunities for the LGBT business community. This way, it aims for the betterment of business conditions for the community.
As part of its LGBT Supplier Diversity Initiative, it then awards such businesses the Certified LGBT Business Enterprise or Certified LGBTBE accreditation.
You can also socialize and experiment with other fellow entrepreneurs. Here, your certification comes into play and will demonstrate that your company is solvent and ready to begin operations.
Join Startup conferences
There are a lot of small business conferences held online or in person; you could try and participate in one of those. You may not be really obtaining any funds upfront from there, but the kind of knowledge you derive will be extremely beneficial.
There are three purposes attending the conference will solve:
- You get to meet fellow startup owners and exchange ideas with them
- You can access more knowledge on sustainability through the other members of the conference
- You get to network and grow your circle
Therefore, joining and attending a startup conference will be a good idea.
Borrowing from Friends
You can always count on that special set of friends who are always there for you. Reach out to them for financial help if you think they will be able to help. However, it is always good to get a simple agreement made with clauses that state that you owe them the amount at a particular interest rate. This will help avoid confusion later and will keep you in their good books.
You never know; they may even propose a zero interest rate for you!
Crowdfunding is the method of funding a project or business by raising money from a large number of individuals, generally over the Internet in modern times. Crowdfunding can be called a type of alternative finance or crowdsourcing.
If you have a venture that serves as a utility for people, crowdfunding can be an amazing alternative.
Funds from your own income
The best part about using your own income or money for your startup funding is that you can completely and independently control it. You do not rely on anyone else, and you are not answerable to anyone.
Moreover, you know how much money you have and, therefore, can work things out according to your budget.
Useful Tips for a Successful LGBTQ Small Business
When you start your journey to having your own small business, it is only natural to feel a bit anxious. There are diverse aspects that come to your mind, and you tend to have a lot of questions. In this part of the article, we share with you some quick tips that will help you take the necessary steps at the onset of your business.
Let’s catch them here:
Get together with your friends and family for support
Nothing matches the support of your family members and close friends. They mean the world to you, and their support is irreplaceable. When you are only starting out, you certainly need them to boost your morale and to help you build inner strength for the hurdles that you may encounter on the way.
The confidence all your loved ones instill in you is unparalleled. It will help you go a long way and will be with you in times when you hit a roadblock in your endeavor.
You very well understand that when you are only in the first stage of setting up your business, you need to conserve your funds. You can not be extravagant with your expenses. Be wise while you make larger purchases, such as your office space.
Work out the number of employees you will be hiring and the total number of people that will be inside the space. If there are any individuals working remotely, count them out. This will give you an idea of how big the space should be; in other words, you will easily avoid overspending on buying or renting unnecessarily large office space.
Hire the ones you trust
Your employees should be your assets in every sense of the term. That will happen only when you have their trust and goodwill with you. What this means is that you must ensure that the people you hire are supportive of the fact that the owner belongs to the LGBTQ community.
In your interviews, you can include questions that help you know their views on this. Also, you must get to know if they will not have a problem working with or for you. Ultimately, it is all about having a reassuring and benevolent staff that works in a synchronized manner.
Ensure the surrounding community is supportive of you
You cannot start your new business in a homophobic town or city. You will need to be surrounded by people who are sensitive to the fact that it is an LGBTQ-owned business. It is essential you have a cohesive and encouraging atmosphere that is conducive to your business.
You do not have to bear the glares of the people who look down on this fact. Therefore, ensure that the town or the community has an understanding attitude towards you and the business.
Top 5 Recommendations for LGBTQ-Owners of Businesses
Despite all the knowledge and preparation, there might be times when you may feel a bit let down and need some motivation. In times like those, it is crucial you be mindful of all the support you have received so far; also, how you shall move ahead with your head held high.
The following 6 points shall help you gather up yourself and move ahead with a renewed strength:
Talk about Your Experience
You most certainly have an intriguing past as an LGBTQ business owner. There is still a lot of reticence among LGBTQ business owners to come out as proud advocates of their company. Now, the onus is on you to normalize things around you and publicize your presence. You are required to underline your ownership status to your peers and competitors.
It is all about you making others know that you are as much a part of the corporate world as anyone else. From holding press conferences to marketing your product or business, you will be required to go all out to speak on larger and relevant platforms. Consequently, you could possibly receive immense social and financial support. Your self-confidence could make all the difference.
Target and Streamline Your Time and Energy
It all boils down to concentration and attention towards your goals when it comes to running a successful business. The more you concentrate on the minutes of your projects, the better your outcomes will be.
You can outsource some sections and get management to focus on specific areas as you get more specialized. All you need to do is get your staff or the people working for you on the same page and get them to collectively work to accomplish higher grounds.
This will require a lot of time management and people management from your end. Also, remember that humanly it is impossible to handle all the tasks all by yourself. Delegation is the key here. Get the right people for the specific tasks and get them to work efficiently by focusing on the things that matter.
Resilience could be the game-changer for you in your startup journey. In today’s day and age, when things move really quickly, you need to be adaptable to the times. Technological innovation has given rise to fluctuating customer demands and buying patterns. Being mindful of the rapidly changing statistics can go a long way in establishing the success of your business.
Work on your business model. Fill in the gaps and loopholes if you spot any. Take into account the fact that some of your staff may not be available at times due to varied reasons. Clients and customers may back down at the last moment. These are the situations that call for you to be resilient to continue to produce outstanding results.
Recognize Your Financing Sources
The blame for the failure of a small business solely lies with the shortfall of finances. Your caste, creed, or gender has got nothing to do with it. Therefore, you will have to consider all of your available financial choices and sources carefully, which could aid your business.
Whether it is online lenders, your crowdfunding plan, or any other source of funding, you will have to be cautious with the ways you spend and chalk out your economic journey.
Continue Reading and Learning
Being informed and accessing complete knowledge of your field is the key to having a sustainable and meritorious business. Be it the U.S. or any other place; you will need to get a lot of business aspects under one roof.
The elements that are integral to your business are accounting, taxation, insurance, basic software, sales, marketing, and advertising. You will also need to take into account how you will spread the word about your business and make your online presence felt.
Read and educate yourself about the energies, resources, and workforce you will require. Your knowledge is the best equipment you can ever have while setting up your LGBTQ small business.
How can Deskera Help You?
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In comparison to other social categories, the LGBTQ community has been largely disregarded as a group. This could be observed in the fact that there are very few resources available to them.
Yet, there has been a rise in LGBTQ-owned businesses. They have been creating the right impact at the right place. Here are some key observations from the article:
- An LGBT person must own, operate, manage, and control at least 51 percent of the company
- The enterprise must be self-contained from any non-LGBT business enterprise
- LGBT owners must be citizens of the United States or lawful permanent residents
- Such an enterprise must be headquartered in the United States
- Being barred from collaborating, connecting, and commercial possibilities, difficulty in finding employees and customers are some of the common problems that the LGBTQ business owners face
- Despite all the discrimination meted out to them, there are no specific laws or legal protection offered to them. So, not only does the LGBTQ community have to deal with those problems, but they also do not have any legal rights to fight the inequity
- Angel capitalists or Angel investors contribute funds to a firm or a business startup in exchange for financial liabilities or ownership equity and provide assistance to new small businesses
- The SF LGBT Center institution in California is proudly associated with LGBTQ financing. It functions as a gateway between the LGBTQ community and the resources they need. This non-profit group assists people, including LGBTQ small business owners, by obtaining financial necessities
- StartOut is a non-profit organization that helps aspiring entrepreneurs. StartOut offers tutorials to its clients and assists LGBT entrepreneurs. It also provides a wealth of resources, including investors
- You may also seek out grants from online lenders, which is a common thing nowadays. Additionally, the process will move more swiftly than with the government grants
- Joining the local business chamber for LGBTQ could have various advantages for you. Being a member of your local business chamber allows you to expedite your contacts with financial institutions while also providing you with several educational opportunities
- The National LGBT Chamber of Commerce (NGLCC) is a non-profit advocacy organization that focuses on strengthening economic opportunities for the LGBT business community. As part of its LGBT Supplier Diversity Initiative, it then awards such businesses the Certified LGBT Business Enterprise or Certified LGBTBE accreditation
- There are a lot of small business conferences held online or in person; you could try and participate in one of those. You may not be really obtaining any funds upfront from there, but the kind of knowledge you derive will be extremely beneficial
- You can always count on that special set of friends who are always there for you. Reach out to friends and family for financial help if you think they will be able to help
- Crowdfunding is the method of funding a project or business by raising money from a large number of individuals, generally over the Internet in modern times. Crowdfunding can be called a type of alternative finance or crowdsourcing
- The best part about using your own income or money for your startup funding is that you can completely and independently control it. You do not rely on anyone else, and you are not answerable to anyone
- Some useful tips for the new entrepreneurs include avoiding overspending, hiring a trustworthy staff
- Some of the best recommendations for the LGBTQ entrepreneurs comprise being resilient, talking about their experience, recognizing their financing sources, continuing to educate themselves, and so on