3. Minority-led SMBs turn to digital tools because of lack of funding
Small businesses owned by minorities were more likely to make the most out of digital tools during COVID-19, according to the Digitally Driven study.
Why it’s important: These minority-owned businesses that quickly adapted to the new normal and have a higher comfort level with digital tools have become more focused on long-term business goals through the pandemic.
Minority groups are leading the digital drivers’ category – those who are early adopters and are constantly deploying new technologies to scale their businesses.
Among digital drivers:
- 46% are Black-owned businesses.
- 41% are Latino-owned businesses.
- 38% are Asian-owned businesses.
The challenge: The study found that minority-owned businesses were roughly half as likely as white-run businesses to have received aid through public loans like PPP.
What this means: Despite being digital drivers, minority-owned SMBs have been the hardest hit by COVID-19 and are not receiving the funding needed to deploy their strategies.
- Key numbers: 41% of Black-owned businesses and 32% of Latino-owned businesses have closed compared to 17% of white-owned businesses.