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Building Wealth: Empowering Black Small Business Owners Through Investing

A new program shows promise for increasing stock market participation and investing confidence among Black entrepreneurs.

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By Trey Waters, MK Falgout, Wanjira Chege, Heidi Johnson

Category:

Equity, Measurement, Small Business

Tuesday, May 27, 2025

Building Wealth: Empowering Black Small Business Owners Through Investing

How Building Wealth Can Support Black Small Business Owners’ Success

Aspiring Black entrepreneurs face significant barriers when launching and growing their enterprises, including limited access to small business loans or personal wealth. These barriers both deter potential economic growth and contribute to racial differences in business ownership. And while people who build wealth through the stock market are more likely to start businesses, Black consumers are three times less likely than white consumers to invest in the stock market.

Stackwell, Michigan Black Business Alliance (MBBA), and Prudential Financial launched the Small Business Investment Program (SBIP) in 2024 to create pathways to prosperity for more Black entrepreneurs. The yearlong initiative provided 200 small business owners with investment education, access to an investing platform, and funded investment accounts. The Financial Health Network evaluated SBIP to better understand how the program shaped participants’ investing behaviors and attitudes.

Our findings show how programs like SBIP can be a powerful way to drive business and personal financial health, foster small business creation, and expand economic opportunity for all.

Outcomes at a Glance

Participants’ balances grew over the study period, with an average balance of $1,838 by the end of the study.

One in five participants (20%) made at least one deposit of their own money during the study period, showing their commitment to building wealth.

75% did not withdraw any funds from their investment accounts during the program, demonstrating a commitment to long-term investing for wealth-building.

67% of participants said they sought out Stackwell for trusted financial advice, more frequently than any other source.

Data Spotlight

Figure 1. Participants’ account balances increased over the course of the program.
Average balance per participant, number of program participants

vertical bar chart showing how program participant's balances increased

“It was a blessing to have the funding from the Stackwell program to get going.”

SBIP pilot participant and small business owner

About Our Methodology

This research drew from three different data sources:

- A survey of MBBA members, including both those who did and did not participate in the Small Business Investment Program.
- Administrative data from the Stackwell app.
- In-depth individual interviews of MBBA members participating in SBIP.

All data were collected at the individual level and de-identified. Survey responses and administrative data were linked to provide a more comprehensive picture of app users’ experiences.

Our Partners

This report was developed with support from Stackwell and in partnership with Prudential Financial and the Michigan Black Business Alliance. The Financial Health Network conducted this research to illuminate the experiences of Black small business owners with investing and explore how their behavior and attitudes toward investing evolve over time with access to an investing platform. The insights and opinions expressed in this report are those of the Financial Health Network and do not necessarily represent the views or opinions of our partners, funders, and supporters.

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