Sign On 
By Ruth Jacks, Executive Vice President, Head of Diverse Segments, Wells Fargo
Women-owned and underrepresented businesses are two of the fastest growing segments in the U.S. population. Companies founded and led by military veterans and those who identify LGBTQ+ are also on the rise.
- There are more than 2.5 million women-owned and underrepresented businesses in the U.S. as of 2021.
- The number of women-owned businesses grew nearly 14 percent between 2019 and 2023; they generate $2.7 trillion in revenue annually.
- The LGBTQ+ community comprises nearly 14 million adults and is growing rapidly, especially among Gen Z.
Despite the power in these numbers, non-traditional groups are far more likely to be misunderstood or underserved in the business world than their peers.
Making an outsized impact in the community
There’s tremendous value to adopting a broader perspective and a more inclusive approach. Supporting diverse businesses can create a ripple effect of positive outcomes that benefit entire communities—and often, multiple generations.
With adequate support, diverse business owners can:
- Scale their companies more quickly
- Hire other diverse individuals in well-paying jobs
- Accumulate personal wealth to improve their standard of living
- Keep operations “in the family” when first-generation owners retire
- Fuel their neighborhoods through stability and economic growth
- Expand regionally and nationally
The bottom line? Supporting even one diverse business can make an outsized impact.
How to help diverse businesses overcome obstacles
Unfortunately, owners, entrepreneurs, and business leaders outside the mainstream often face extra challenges. Here are just a few of the day-to-day struggles we’ve seen—and how we’ve helped diverse businesses overcome these hurdles.
- Establish cross-cultural trust. Trust is vital to strong business relationships. But, studies show non-traditional business leaders often have less access to business resources and financial services than their peers. Language and cultural barriers—particularly for first-generation immigrants—can extend the gap by making it uncomfortable to ask questions or access basic information.
Change begins with forward-thinking banks that recognize the roots of this dynamic and make extra effort to be helpful, educational, and respectful of diverse business customers. Hiring diverse teams also demonstrates a commitment to growth and support of all types of business owners and entrepreneurs.
- Find allies. When you’re the “only” in a room, there’s an extra sense of pressure. Of loneliness. Of potential challenges in being seen, heard, and respected. I’ve experienced this firsthand as a Black woman leader, a military veteran, and an LGBTQ+ individual. For diverse entrepreneurs, simply finding a supportive community with shared experiences can propel a business forward.
- Build peer networks. Having a close circle of professional resources is another essential for success in business. Owners can tap these resources for ideas, expertise, and recommendations at all stages of the business lifecycle.
At Wells Fargo, my Diverse Segments team and I work daily to build these invaluable connections, whether it’s through education and awareness, more bankers who speak other languages, networking events for our customers and communities, or simply reaching out to non-traditional business owners.
- Take a holistic approach. Underrepresented businesses rarely achieve the same access to credit, financial services, and wealth management as their peers. In many cases, there’s a longstanding perception that certain demographics are more risky and less credit-worthy, making some venture capitalists, investors, and banks less apt to extend capital or proactively build relationships with diverse entrepreneurs.
Taking a more nuanced approach can counter this. It starts with education—not a “one size fits all” view. Native American businesses, for example, may appear unnecessarily risky when subjected to traditional credit underwriting. However, once you understand how tribal sovereignty works, the numbers can tell a different story.
- Recognize the value of military experience. Those who’ve served in the armed forces learn many skills, from discipline and communication to teamwork and problem-solving. However, translating these experiences into civilian life isn’t always clear cut. A team trained in inclusivity knows to take a second look at these hard-working entrepreneurs. There are usually far more strengths at hand than what a casual glance (or typical loan application) may show.
As all these examples demonstrate, when you take the time to see each company and each business leader on a case-by-case basis, you can bring about lasting change that opens doors for all.
Working together on flexible solutions
Helping diverse business owners succeed takes many forms. My team works with clients experiencing many different challenges; some may have a solid track record in one or two areas but struggle in others. Back-office inefficiencies and poor cash flow, for example, can put a company on the brink of bankruptcy no matter how promising their products or services.
Discussing these challenges with entrepreneurs can be frustrating. Bankers have sound advice, but won’t necessarily share the same emotional connection to a business that its owners do. At the same time, business owners may need time and empathy in difficult situations. An option like selling the company to preserve profitability may not be viable based on their attachment to the business.
The key is listening and communicating authentically. This enables us to create solutions suitable for all parties. Once both sides establish trust, everyone can explore go-forward strategies. In this case, Wells Fargo helped introduce the company to other sources of capital. They maintained ownership, received a new injection of funds and guidance, and once again fulfilled their credit obligations. It was a win-win for all sides.
Creating opportunity for all businesses
Launching and leading a business represents more than just hard work; for most business owners and entrepreneurs, it’s the culmination of a lifelong dream, a journey filled with pride and passion. With a conscious commitment to diversity and inclusion, we can help create and sustain more of these opportunities for all genders, races, and identities.
