Wakuda is an online marketplace that elevates and supports independent Black-owned businesses in the UK. Co-founders Albert Larter and Nathaniel Wade explain why they launched the platform in August 2020, and how brands can support black-owned businesses.
Since the Black Lives Matter protests in 2020, we have seen a huge rise in corporations wanting to support black-owned businesses. Is it sincere? Is it token activism done off the back of a sensitive matter to receive reward from consumers? We think it’s a mixture of both. One thing that’s for certain is that it is a step forward. But more needs to be done.
Black-owned businesses are underrepresented
Historically, Black-owned businesses have been underrepresented in the UK. To be clear, this isn’t due to the Black population lacking aspiration or entrepreneurial ambition, but funding is an issue.
The Colour of Money report, published in April last year by The Runnymede Trust, found Black African and Bangladeshi households have 10p for every £1 of White British wealth, so receiving investment from family to grow a business is often not feasible.
There is also a clear barrier in accessing capital as concisely concluded in the November 2020 Diversity Beyond Gender report from Extended Ventures. Black entrepreneurs receive the poorest outcomes when it comes to gaining investment, receiving only 0.24% of the total capital invested between 2009 and 2019, far from the 3.5% of the UK population they represent. Whilst more needs to be understood as to why this is, the disparity is clear.
The rise of conscious consumerism
From awareness about environmental impact, to how employees are treated, and a desire to support local and small businesses, today’s consumers are more conscious about what they are buying, and the impact on society. Numerous studies show younger consumers in particular expect brands to play a role in addressing social issues.
A recent report by Wunderman Thompson found that for American Gen Z-ers, brand choice is an extension of who they are and what they stand for; 60% see their choice in brands as an expression of who they are and 79% want their money to go to a brand they believe in. Moreover, 78% believe that, in the wake of COVID-19, brands have a responsibility to help build a better normal.
In short, there has been a notable shift in consumers wanting to support companies who are more ethical in their business operations.
A fundamental reason for Wakuda’s existence comes from our desire to work towards an equitable, sustainable ecosystem where supporting independent Black-owned businesses becomes as natural and instinctive as purchasing from any other mainstream business, or platform.
The response so far has been amazing. Less than a year after launching, we now host over 250 businesses; they’ve seen an average of 70% growth since launch and some of our partners have experienced over 100% growth in sales since joining the platform. It’s especially satisfying as the customers on our platform are extremely diverse – which clearly demonstrates consumers are thinking differently about how and where they are spending.
We have noticed a huge effort in consumers supporting small independent businesses. Through social media and the like, consumers are becoming aware there are many quality alternatives to the likes of behemoths like Amazon. It’s a pressing issue, since the Federation of Small Businesses suggests that up to 250,000 small businesses could go bust in 2021.
People are becoming a lot more aware that the money spent with a small local business has a tangible social impact, such as creating jobs, supporting a local entrepreneur, and ensuring a healthy and sustainable local economy. Increasingly, consumers like knowing who they are purchasing from, they like seeing the authentic character behind a brand and hearing their story.
Support Black-owned businesses
At Wakuda, we build very specific strategic partnerships with organisations whose values align with ours. All partners have an equal advantage when it comes to selling on the platform. Moreover, unlike other platforms, we don’t seek to compete with our partners by listing our own items on the platform. We do not hamper our partners’ selling potential by charging them fees if they choose to sell on different competing platforms. At Wakuda our responsibility lies with customers and our partners’ experience (we do not sell advertising space) and and we aim to maintain a fair and equitable environment for both.
There’s an opportunity for brands to collaborate and work with more diverse groups both authentically and ethically. Brands that are looking to partner with, or support, Black-owned businesses but don’t know where to start can find many on Wakuda. A simple, sustainable action is to broaden supply chains by incorporating services and products from Black-owned businesses in your B2B supply chain. When it comes to diversity, companies must accept there is not a quick fix – but creating a culture where everyone has equal opportunity to flourish is an obvious place to start.
Investors need to step up
Lastly, it’s time for investors to acknowledge the profitable, ethical and economic benefits from investing in opportunities outside what has been done historically. Investment companies need to have more diverse workforces and there needs to be more research done into establishing an evaluation process for Venture Capital funders so they can make decisions that are unbiased.
At the end of the day, everyone needs to get comfortable being uncomfortable, to have open conversations and to ask questions. Not speaking about it has been a big part of the problem.