Lacking Private Investment, Government Aid Is Needed to Help Black Entrepreneurs Grow

As a black attorney with a deep concern and commitment regarding black enterprise, I read with interest the June 26 article, “Black Entrepreneurs: Lost in the Crowd?”

In 1965, I was a founder and vice president of the Los Angeles Area Economic Development Agency, a nonprofit corporation established to promote small businesses in Los Angeles County among blacks, minorities and the underprivileged.

When this federal program was terminated in 1968, only four of the 100 small businesses initiated had failed. The 4% failure rate is a great achievement in view of the national failure rate of 85%.

The success of this program was due in most part to the monitoring of the new business, including access to real estate brokers, accountants and consultants for the Small Business Administration, which supervised the program.

The need for this type of program among blacks and minorities was due to the lack of investment funds. Metropolitan private banks and institutions were unwilling to invest in a black business, especially one without a successful track record.

The article mentioned that immigrants frequently pool their resources to help each other. However, despite the success of a few blacks in the business arena, there are not enough of them to provide sufficient money to establish a business and keep it going until it reaches the break-even point.

The fact that government funds to assist minorities are fast drying up without any alternative is leading to frustration in the black community.

RAYMOND L. JOHNSON SR.

Los Angeles