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Black Business is Her Business: With an eye on the future, researcher traces African American entrepreneurship back before the Civil War

When Oprah Winfrey became America’s first black female billionaire, Forbes magazine took note. The major news networks took note. And Dr. Juliet E.K. Walker, professor in the Department of History at The University of Texas at Austin, took note as well.

As the country’s foremost expert on black business history, Walker has made black business her business. And recently, she’s made Oprah Winfrey her business, too.

Juliet Walker at Pavilion Lincoln Mercury, an Austin car dealership
Dr. Juliet E.K. Walker explores the history of black businesses, such as the one pictured here. Austin car dealership Pavilion Lincoln Mercury is one of the largest black-owned businesses in the country.

While the media may be interested in Winfrey’s wardrobe, weight loss or famous car giveaways, Walker is interested in her role as an entrepreneur and what her success says about race and gender in business today. She’s exploring this in “Oprah Winfrey: An American Entrepreneur,” a book she is writing for Harvard Business School Press.

For Walker, Winfrey is a complicated figure. She is a potent personality and a cultural phenomenon as well as a remarkably accomplished businessperson. Her success in marketing the Oprah brand in television, film and publishing transcends race.

“The primary way I relate Oprah to black business is that she is a black person who is involved in business who has never really depended on a black consumer base,” Walker says. “Yet her business activities reflect certain aspects of the expansion of black business activity in the late 20th century, her joint ventures being one.”

Winfrey’s joint ventures with Walt Disney, Oxygen Media and Hearst Magazines are typical of what Walker considers the most recent wave in the rise of black corporate America.

In her book, “The History of Black Business in America,” Walker details the breadth of black business, beginning with the activities of African American slaves, among whom she marks a history of entrepreneurship. For most of the 20th century, small retail and service establishments and black hair care product manufacturers were the bedrock of black business.

Without the history of blacks in business, you really do not have a full picture of the African American historical experience. And you tend to lose sight of the continuing racial inequities. Dr. Juliet E.K. Walker“In the first waves of the century, black businesses catered to a black consumer market,” Walker says. “Businesses were primarily sole proprietorships, and the only real corporate businesses were insurance companies and banks. Later, with various affirmative action agendas and government support, blacks were able to develop enterprises within a larger market.”

In recent years, many black businesses positioned themselves for participation in the mainstream American business community through forming joint ventures with mainstream businesses. It’s an expansion in the crossover market black businesses first found in the civil rights era and exemplified by Berry Gordy’s Motown Records, founded in 1959.

Still, while it is easy today to point to African American business success stories—Black Entertainment Television (BET)’s founder Robert Johnson, sports star turned businessman Magic Johnson and hip hop entrepreneur Russell Simmons are obvious examples—the reality is that African American businesses are not even close to achieving parity with white businesses.

African Americans own only two percent of the nation’s businesses, and almost half of all black-owned businesses have receipts of less than $10,000. The average annual receipts of African American-owned are $86,500, compared to $410,600 for all U.S. firms. And in 1997, black business receipts totaled only .4 of one percent of all American business receipts.

Walker believes that in addition to acknowledging the state of black business in the country, it’s critical to understand that African Americans have a long history of business activity. Black economic history tends to focus on unemployment and low wages, and pre-Civil War history tends to focus on plantation slavery and the internal dynamics of the slave institution. Walker argues that these are limited perspectives of history.

Percent Distribution of Black-Owned Firms by Industry Division: 1997“Without the history of blacks in business, you really do not have a full picture of the African American historical experience,” she says. “And you tend to lose sight of the continuing inequities.

“There is a historic tradition of business activity in the black community. Our history indicates that policy makers can no longer ignore the issue of race and blame the comparatively poor performance of black business compared to other races on the absence of a historical tradition.”

To help support the study of black business history, in 2002 Walker founded the Center for Black Business History, Entrepreneurship and Technology (CBBH). It is the only such center at an American university, and it was formed in response to the racial disparities in wealth holding, employment opportunities, income and business profits in America.

Establishing CBBH in the College of Liberal Arts acknowledges that to look at and understand black business, you have to look at the entire American culture. In addition to promoting and supporting further research and organizing conferences, the center established the Texas Black Business Hall of Fame, which inducted its first members in 2003.

Inductees Sherra L. Aguirre, Comer Cottrell, Kase L. Lawal and George Foreman were singled out for their distinctiveness in African American entrepreneurship, their contributions to American business and their community leadership in the State of Texas, particularly in their support of black colleges and universities.

Aguirre built a business by profitably professionalizing the domestic work of black women. The founder and CEO of Aztec Facility Services in Houston, Aguirre expanded her original cleaning service to become owner of one of the nation’s largest black female-owned businesses. With 1,000 employees, her multimillion-dollar business provides facility management and support services to corporate, industrial and government clients in four states.

In 1997, total African American business receipts amounted to $71.2 billion, just .4 of one percent of all American business receipts.Lawal, an African immigrant, owns the Houston-based oil and gas refinery, CAMAC Holdings, Inc., only the second black enterprise to have business receipts of more than $1 billion. Foreman was recognized as “America’s Salesman” because of his many successful business ventures, including the George Foreman Grill. More than 50 million of them sit in kitchens across the globe.

Cottrell’s story offers an interesting look at black business in the 20th century. In 1970 he and his brother co-founded Pro-Line Corporation, one of the “big four” in black hair care products manufacturing. Pro-Line became one of the largest black businesses in the nation, with more than $100 million in annual receipts and markets in 43 countries. Cottrell was also part owner of the Texas Rangers baseball team.

Cottrell sold Pro-Line in 2000 to Alberto-Culver. The sale marked the end of an era when African American-owned businesses dominated the black consumer market in the sale of hair care products and cosmetics for blacks. Like the sale of BET to Viacom in 2002, it indicates the increasing difficulties black businesses now face in competing for the black consumer market.

“The question that must be answered,” Walker says, “is why has it been necessary for many of the nation’s largest black-owned businesses to sell out, notwithstanding the growing and profitable black consumer market, now some $600 billion?”

Fred Patterson in Patterson car
Fred Patterson sits in the Patterson car in front of C.R. Patterson & Sons, a car manufacturing company. Established in 1865 by slave-born Charles Patterson, the company made 28 different models of buggies, wagons and hearses.

Walker believes work like that at CBBH will help. Forums with successful black entrepreneurs are planned, and each year the center organizes a conference that addresses an important issue in black business. In October, CBBH will host “Selling Blackness and Getting Paid: Hip Hop Entrepreneurs and Business Enterprises.” The conference will examine the multiple business activities generated from the hip hop industry and its impact on the economic life of African Americans.

“Our hope is to secure the profitable expansion of black business activity in which black businesspeople are able to tap into the mainstream American market in the same way as Fortune 500 companies do,” she says.

The goal is in line with the goal of civil rights organizations for the 21st century: to create economic freedom and bridge the wealth gap for African Americans. For Walker, this means looking to successful contemporaries like Winfrey and Robert Johnson and also back to the roots of black business before the Civil War. In her research, Walker has uncovered numerous examples of early entrepreneurs, but it’s a story from her own roots that she often returns to.

In her first book, “Free Frank: A Black Pioneer on the Antebellum Frontier,” Walker relates the history of Frank, born a slave in South Carolina in 1777. After moving with his owner to Kentucky, he was allowed to hire out his time and eventually set up his own saltpeter works, an enterprise he maintained until he left Kentucky. The fact that saltpeter was a main ingredient in the manufacture of gunpowder is an irony not lost on Walker.

“That in itself was a contradiction,” she says. “It was illegal for slaves to carry firearms, but here’s a slave processing an ingredient used in gunpowder.”

In 1817 Frank purchased his wife’s freedom for $800. Two years later he bought his own liberty for the same price. By the end of his lifetime, Frank had founded the town of New Philadelphia, Ill., and purchased the freedom of 16 members of his family. He was a successful businessman, purchasing land and dealing in livestock.

An entrepreneur, pioneer and model of industry, Free Frank also holds one more distinction. He was Walker’s great great grandfather.

Vivé Griffith
Office of Public Affairs

Photos of Dr. Walker: Marsha Miller

Chart: U.S. Census Bureau

Photo from banner graphic: S.J. Gilpin shoe store, Richmond, Virginia,
from African American Photographs for 1900 Paris Exhibition,
Library of Commerce Prints & Photographs Online Catalog

Office of Public Affairs

P.O. Box Z
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Fax 512-471-5812

  Updated 2005 March 15
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