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💪🏿 The Black-owned business boom
May 5, 2022
PLUS: ‘Wordle’ news, and how table scraps can save the planet.
A pair of criminal defense attorneys in Texas are in the midst of a doobie-ous trademark dispute. The lawyers, who both specialize in marijuana-related matters, are fighting over who can call themselves the “dopest lawyer.”
In today’s email:
Boom: The number of Black business owners grew 28%.
Chart: Has “Wordle” peaked?
Deja food: The startups repurposing table scraps.
Around the web: Microscopic photography, how to stop procrastinating, teensy seahorses, and more cool internet finds.
🎧 On the go? Listen to today’s 10-minute podcast to hear Jacob and Juliet tackle TurboTax’s $141m settlement, the NYT’s puzzle business, and how consumer habits are shifting back to pre-pandemic norms.
The big idea
Black-owned businesses are booming
The pandemic was particularly rough on Black-owned businesses, many of which are concentrated in retail, restaurants, and other sectors where social distancing is hard.
58% of Black businesses were at risk of financial distress before the pandemic, compared to 27% of white-owned businesses.
Between February and April 2020, the number of Black business owners in the US dropped 41% compared to 17% for white business owners, perReuters.
In the 1st round of Paycheck Protection Program (PPP) funding, Black-owned businesses were 5x more likely than white-owned businesses to receive nothing.
But now, Black-owned businesses are on the rise
An analysis of Census data by Robert Fairlie, a research associate at the University of California, Santa Cruz, found that the number of Black business owners was 28% higher in Q3 2021 than pre-pandemic, perUS News. Why?
Black-owned businesses were already growing pre-pandemic, increasing 8% between 2018 and 2019.
And while the pandemic stalled many companies, it also led to new business growth overall as people pivoted into new revenue streams.
… the racial reckonings of 2020 led to greater scrutiny of disparities facing Black business owners, including:
Net worth: As of 2019, white families had a median net worth 7.8x that of Black families, meaning they’re less able to rely on family financial support.
Access to capital: Only 3% of venture capital goes to Black founders.
“My guess is that the revised PPP program helped… but also more racial inequality awareness by customers and larger businesses seeking suppliers,” Fairlie told US News.
To keep this momentum…
… may be challenging. A McKinsey report noted that only 4% of Black startups are successful, and most start with ~$72k less capital than white startups.
But investments in an equitable business ecosystem that closes the wealth gap could add $1T–$1.5T in annual GDP.
For more: Check out this Brookings report to see interactive charts that show how racial parity would change major US metro areas.
New rates: The Federal Reserve raised its benchmark interest rate by 0.5% to help fight inflation — marking the biggest rate move since 2000.
CVS reported Q1 sales jumped 11%+ YoY largely due to covid vaccines and test kits. The company administered 6m+ tests and 8m+ vaccines in Q1 2022.
Metaverse music: Spotify announced the launch of “Spotify Island” in Roblox, making it the 1st music streaming service to have an official presence within the sandbox gaming platform.
Full circle: A new WSJ report revealed Elon Musk plans to take Twitter public again within as little as 3 years of his acquisition.
How to market a bestseller: Female Startup Club founder Doone Roisin dropped her pre-launch strategy and post-launch analysis for Trendsters.
Update: TurboTax agreed to a $141m settlement for charging ~4.4m Americans who should have qualified for free tax prep. Read our previous coverage here.
Not good: An Alignable survey found 34% of small US retailers were unable to make rent in April, citing inflation, supply chain issues, and increased rent. #ecommerce-retail
Cool: Scientists at the University of Texas at Austin created a modified enzyme that can break down polyethylene terephthalate (PET), a synthetic resin accounting for 12% of waste worldwide, in a few days vs. centuries. #clean-energy
Mmm: Cambridge University researchers made a robot chef that can “taste” how salty a dish is at various stages of chewing. The goal is to make food tastier. #emerging-tech
Massachusetts finance school Bentley University will now accept crypto for tuition. President E. LaBrent Chrite said the school is proud to embrace the tech that will “soon transform the global business landscape [students are] about to enter.” #fintech-crypto
Twitter trouble: In an SEC filing, Twitter warned it may lose employees, struggle to hire new ones, and lose advertisers before its sale to Elon Musk closes. #big-tech
Three months later, what’s up with ‘Wordle’?
Are people still playing “Wordle,” or did the game pull an “HQ”?
To recap, it didn’t take long for “Wordle” to blow up after it launched in October. It attracted millions of players and has seen 23.5m tweets from people sharing their “Wordle” scores.
But it’s been 3 months since The New York Timesbought the game for a “price in the low seven figures,” so you might be wondering what’s happened since.
Honestly, nothing crazy
For a moment, the Times pissed people off when their winning streaks didn’t carry over. But the biggest differences appear to be aesthetic, including prompts to play other Times minigames.
Was “Wordle” a good investment?
Yes. In the company’s earnings call Wednesday, Times CEO Meredith Kopit Levien said, “Wordle brought an unprecedented tens of millions of new users to The Times.”
That likely helped spur a record quarter for its game division and the addition of 387k digital subs.
BTW: If you’re tired of words, but like the “Wordle” concept, you can try out “Heardle” or “Worldle.”
The latest SEO and keyword research tools
You should actually be thankful SEO isn’t fun or sexy.
It’s a big reason why simple adjustments to the writing on your webpages can boost visibility the way they do — because far too many businesses aren’t up on these accessible strategies.
There are many culprits of climate change, but a big one is food waste.
According to the UN Environment Programme, food waste makes up 8%-10% of greenhouse gas emissions, and accounts for $940B in annual economic losses globally. Yikes.
Enter the circular economy…
… which refers to repurposing waste rather than tossing it to a landfill.
While the concept applies to various industries (e.g., fashion, tech), the circular food space is thriving by bringing table scraps back to life.
Loop Mission, which buys extra and/or ugly produce that would otherwise go untouched, and squeezes it into juices and other products.
Pulp Pantry, which takes veggie pulp that’s typically discarded post-juicing, and turns it into chips.
Silo, a fine dining restaurant in London, which repurposes would-be food waste to create new dishes.
Besides making new food…
… other startups are building tech to help chefs track their waste. Winnow, which makes software-enabled kitchen tools, helps commercial kitchens track waste to improve planning for the future — it’s already saved36.5m meals.
While munching on old table scraps might not sound appetizing, it’s probably not as bad as you think. Last year, Mark Cuban picked Pulp Pantry as 1 of his 5 favorite holiday gifts.
BTW, for more Pulp Pantry and Cuban, check out “Shark Tank” tomorrow, where founder Kaitlin Mogentale is set to appear.
AROUND THE WEB
👨🚀 On this day: In 1961, Alan Shepard Jr. became the 1st American in space during a 15-minute suborbital flight aboard the Freedom 7 space capsule.
🔬 Wow: The Olympus Image of the Year Award goes to the best in life science imaging, offering stunning scenes captured through microscopes. Check out 2021’s winners here.
📷 That’s cool: This website uses AI to colorize black-and-white photos.
🎧 How to: Harvard Business Review talks to psychologist Alice Boyes about why we procrastinate, and how to curb it through habits, emotions, and thought patterns.
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