The Black Economic Council of Massachusetts, better known as BECMA, represents Black-owned businesses across the state. The group has an unusual origin story. Not too many organizations trace their origins to a Federal Reserve study, but, then again, the study in question was no ordinary report.
Published in 2015 and titled The Color of Wealth, the findings of the report commissioned by the Federal Reserve Bank of Boston were striking. The study found that in the Greater Boston region, home to more than half of the state’s population, the median wealth of a White household was $247,500, compared to $8 for a Black household. Nicole Obi, CEO of BECMA, notes that in response, “A group of Black business leaders decided to form this organization to address the issues they saw facing this community, which was really preventing the accumulation of wealth.”
The challenge BECMA faced was further illustrated by a 2017 Boston Globe series on local racism, authored by the paper’s famed Spotlight investigative reporting team. The seven-part series began: “Google the phrase ‘Most racist city,’ and Boston pops up more than any other place, time and time again.” The Globe writers further observed that “unfinished business on race is everywhere.”
In the Greater Boston region, the median wealth of a White household was $247,500, compared to $8 for a Black household.Obi, who worked as a businesswoman herself before coming to BECMA in 2020, says her experience corroborates this. As part of her career, Obi ran a consulting firm. “And I had clients like Johnson & Johnson, Volvo, Becton Dickinson, and Commerce Bank. But one thing that had always stuck with me was that in the seven years I was running my own company and doing all this interesting great work, I only had one Boston-based client, and that was a Black woman who hired me. So, when I went to work, I had to get on an airplane out of this town.”
Challenges of Rapid Growth
BECMA may have been founded in 2015, but, for its first five years it remained small. Obi noted that when she first joined BECMA in the summer of 2020 to help with operations, there was really only one full-time staff person, founding executive director Segun Idowu (who left at the end of 2021 to join the administration of newly elected Mayor Michelle Wu). By the time Obi became CEO in January 2022, there were six staff. Today, that number has increased to 16 people. Clearly, BECMA has benefitted from both the energy unleashed by the protests that followed the murder of George Floyd in 2020. It was only afterward that BECMA began to receive significant philanthropic support. This included $1.5 million from a range of Boston sources, a $750,000 grant awarded by the Rockefeller Foundation, and a $1.5 million grant from the Boston-based Barr Foundation.
“We have [to have] the right culture and the right focus on developing our people, or else I think it’s unlikely that we’ll be able to sustain ourselves.”
Obi, who had not worked in the nonprofit sector before coming to BECMA, says that her business experience helped her manage the rapid growth. As Obi put it, “We can’t do the work that we need to do without having the resources. I’m new to the nonprofit space. The model is so different. In a venture-backed space, the venture capitalist is funding the team. The ideas come and go, maybe you have to make a pivot, but you’re able to do that because you have a good team.” By contrast, Obi contended, “In the nonprofit space, people fund programs, but they don’t fund the teams that need to deliver those programs. I find that odd.”
At BECMA, growing the team quickly, Obi said, was imperative, “so we can do what we need to do.” She concedes, however, that fast growth creates a challenge to build and maintain an organizational culture. “That takes extra care and intentionality,” she noted. For this reason, BECMA created the role of chief of people and culture. “That is a C-level role here at BECMA that we have the right culture and the right focus on developing our people, or else I think it’s unlikely that we’ll be able to sustain ourselves.”
BECMA engages in a range of activities, including hosting an annual business expo, advocacy on behalf of Black businesses at the state and local level, and technical assistance. Some of the group’s most innovative work, as detailed below, has taken place around procurement policy.
Taking On a New Approach to Procurement
A key focus area for BECMA has been to create better procurement opportunities for Black-owned businesses. In the field, such efforts usually go by the name “supplier diversity.” According to Obi, the way that supplier diversity has traditionally been done over past decade focuses on getting supplier firms certified as being owned by people of color and then seeking contracts from buyers. But certification has routinely failed to lead to contracts. “And we have abysmal results to show for it,” she added.
So, what is BECMA’s strategy? As Obi explained, the idea is to work with procurement officers and be narrow and targeted in where work is focused rather than seek to change procurement policy as a whole. An initial pilot program was developed in four Boston-area suburbs of Brookline, Newton, Somerville, and Malden. The core idea is to get the chief procurement officers to identify their needs. Once that is done, then BECMA can help identify businesses from within its extensive membership that can meet those needs.
The BECMA pilot put the onus on chief procurement officers to do two things: “1) set the demand for what they are actually willing to buy; and 2) remove the barriers that have prevented them from realizing their goals.” Obi elaborated that BECMA is not seeking to have Black-owned businesses gain contracts in all business areas. Rather, the idea is to start with agreement and clarity with institutional buyers over where there is willingness to open contracts to Black-owned businesses. With that clarity and commitment, BECMA can then work with member businesses to fulfill that demand.
Obi added that even with something that might seem clear enough, like paving streets, specificity is critical. “Are you talking about paving a state route like Route 9, or are you talking sidewalks or bike paths and municipal lots?”
“So, that was the work we did with the buyers,” Obi said. BECMA then worked with other area groups to put together “binders of organizations” that illustrate the capacity of BECMA business members to meet institutional purchasing demand. Among BECMA’s partners were the local food business incubator Commonwealth Kitchen, Amplify Latinx, the Foundation for Business Equity, Browning the Green Space, and the LGBT Chamber of Commerce.
Already, the effort has expanded beyond the original four municipalities. “It’s bigger than municipalities. We have anchor institutions like colleges. We have private companies. We have included other municipalities, like the city of Boston now.”
A Strategy to Reduce the Racial Wealth Gap
BECMA’s formation was in response to the region’s gaping racial wealth gap. Achieving the broader movement goal of closing the racial wealth gap, of course, requires the work of a movement—not just individual organizations. But what is BECMA’s approach?
BECMA focuses on four areas. These are: 1) access to capital, 2) assistance with procurement (as discussed above), 3) support for Black business ownership by “focusing on business equity and the ownership stake that the business owners have in these firms,” and 4) placement—finding positions for more Black people in the skilled workforce and in decision-making roles on government boards and commissions.
BECMA seeks to be strategic in another sense—namely, to help Black businesses gain a foothold in growing sectors of the economy. To date, BECMA has held three electric vehicle “kickstarter” events. As Obi explains, the idea is to take “some of these existing business owners who are very good at running their businesses, but they are not doing it in a high-growth industry. The EV charging industry is poised to take off. There are federal and state mandates. There is a lot of money. And it is highly fragmented. This is a space that we want our business owners in.
This article originally appeared in the Nonprofit Quarterly. See the original article here.
