I started my business with $1,500 to my name, but many who strive to build their businesses have even less--especially when they don't fit the typical "businessman" description.

As a woman and immigrant, I am often asked about the challenges that underrepresented entrepreneurs face. It's easy to say discrimination is a factor--and it is--but the nuance of discrimination is often overlooked. This is especially true as we become more socially conscious and work to reduce obvious bigotry. The nuance of discrimination remains even after more obvious forms (think: offensive slurs) have reduced. One of these nuanced forms that heavily impacts underrepresented entrepreneurs is in the way that the banking industry is structured. 

Thankfully, a welcome change is afoot. Now we're seeing underrepresented entrepreneurs entering the banking industry to create products for everyone. 

Thomson Nguyen didn't grow up envisioning creating a neobanking platform for everyone. However, as the son of parents who immigrated to California with nothing after the Vietnam war, money became the underlying theme of many family dinners. Through his entrepreneurial parents, Nguyen had a front-row seat to the financial struggles of starting a business, and to the empowerment and opportunities that owning a successful business can bring. 

Entrepreneurship is not for the faint of heart. There's hardly any time off, little to no assistance during the startup process, and limited resources available that are not reserved for big businesses. In fact, 52 percent of new small business owners launched their new companies last year with less than $10,000 in funding, according to a Salesforce survey. Nearly half of that group had less than $5,000 on hand on opening day.

And yet, despite a few snags, the entrepreneurial industry continues to expand daily. There has been only one consistent drawback: capital. When Nguyen founded Nearside, he did so to help entrepreneurs like his parents access the capital they need to make building a business easier--especially entrepreneurs from underserved communities. 

Every entrepreneur must navigate similar obstacles on the journey to commercializing an idea. Unfortunately, the necessary resources for those independently growing their businesses are not equally distributed. Access to the finances small businesses need to develop and succeed is far more difficult to obtain for underrepresented business owners than it is for their White competitors. Due to the lack of access to financial institutions, good credit, and financial literacy, underrepresented entrepreneurs are often locked out of debt and equity capital. 

According to Experian, 28 million consumers are "credit invisible" (meaning they have no recorded credit history), and an additional 21 million have "unscorable" credit files, meaning they have a thin or limited credit history. This problem presents the biggest obstacles within communities of color, with 1 in 5 Black consumers and one-third of Hispanic consumers not having any credit in their name. Due to systemic inequities prevalent in the banking world, 65 percent of Black consumers and 51 percent of Hispanic consumers are left unsure of the steps needed to establish or improve their credit.

Historical discrimination in the financial industry, especially in the Black community in America, has been well documented. From the loss of $3 million in savings due to the demise of Freedmen's Bank to redlining and branch deserts that still persist today, the cultural legacy of injustice to Black Americans has resulted in a severe distrust between the Black community and banking options, causing a staggering economic divide--especially when it comes to entrepreneurs. The pressures of the Covid-19 crisis placed on the market have only further stressed the division. 

Fortunately, financial innovations in fintech combined with a commitment to inclusion are what inspire business leaders like Thomson Nguyen to create solutions to help bridge the opportunity gap. 

How to Initiate the Change

While the pandemic has stressed the market, it also opened the door for many individuals to venture out on their own, sparking a surge in small businesses and entrepreneurs. According to the Kauffman Foundation's National Report on Early-Stage Entrepreneurship in the United States, growth in entrepreneurship in 2020 was high among immigrants and Latinos. Veteran and Black entrepreneurs also realized the most significant year-over-year increases. These results are an early sign that banks and other financial institutions are finally meeting the unique needs of entrepreneurs and creating solutions that include those who were previously ignored.

Economic empowerment removes structural barriers and systemic biases and enables individuals and businesses to grasp opportunities. Nguyen's mission is to power the new economy and provide small business owners access to transparent and fair financial products. By rethinking business banking and eliminating the unnecessary hoops. The goal is for their customers to keep more of their money so that they can put the savings back into their businesses. 

As small businesses continue to rise and flourish, the aim of financial inclusion is being adopted on a large scale. Experian just launched Experian Go, the first program of its kind designed to help credit-invisible individuals. An extension of Experian Boost, this program allows anyone to build their credit score manually and on their own terms, hopefully improving the trust many lack with financial institutions. 

The most crucial step during the business-building stage for entrepreneurs is the beginning. When you have a solid foundation to build upon, your chances for success increase exponentially.