Layoffs lead to start-ups of new black businesses

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The saying “when life gives you lemons, make lemonade” seems easy until you’re faced with exactly that prospect. For those Americans who are too young to have experienced the Great Depression, the economic outlook may never have seemed quite as sour as now. With the U.S. Bureau of Labor Statistics listing the national unemployment rate at 10.2 percent nationwide, and 15.7 percent for blacks — there are lots of lemons to go around.

Yet in the face of such bitter circumstances, some of the unemployed are turning their layoffs into opportunities.

Last October, Tommy Venerable of Washington, D.C., found himself out of a job as a graphic Web designer, a position he’d held for five years. With some 14 years of experience in the industry, Venerable initially thought it would be easy for him to find another job.

“I kept getting rejections,” he said. “I kept getting, ‘Do you have a four-year B.A. in graphic art?’ And I’m like, ‘No, I don’t have a college degree — don’t have a college degree in graphic art; don’t have a college degree in anything.’ So after about two weeks, that’s when I really started to panic.”

Venerable’s company had given him a severance package, but those funds were drying up. In need of a new source of income, he found inspiration in an unusual place for a graphic Web designer.

“I’m at the grocery store,” he said, “and I wanted to get tortilla chips and salsa and I could not find a salsa that I liked. And that’s when the light bulb went off in my head.”
Not long thereafter, Venerable whipped up Tommy V’s Salsa and formed his own company, Tommy V Foods, LLC. He ran into some road bumps along the way, getting the proper permits. But he got them and started selling his salsa at a farmer’s market this past June.

“I broke even in August. And from then on, I’ve been up about 10 to 15 percent profit margin,” Venerable said.

For Karl and Jennifer Carpenter of Nashville, meanwhile, life seemed to have been going along as planned. They met years ago when he went to view an apartment in a building that she managed. They fell in love and married. He was an engineer and then an executive, eventually moving into management with his company. She was a homemaker happily raising their five children while buying investment properties for the family. But then the recession hit and Karl was laid off.

“The bottom fell out last year when the company downsized from 4,000 to maybe 400,” Jennifer said.

At that difficult moment, the Carpenters decided to make use of a historic building they owned in downtown Nashville. Using their savings and Karl’s severance as start up capital, they turned it into their new restaurant, the Garden Brunch Café.

“Getting ready for Sunday brunch, I looked in the mirror,” said Jennifer. “And I was putting on my little chef’s hat and I almost broke into tears because I’m like, ‘God, you really have a plan.’ Because I never dreamed that this is what I would be doing. People gave me the title of chef after tasting my food. But I’ve never been to culinary school. ” The café opened in May and the crowds keep coming.

The U.S. Small Business Administration reports black-owned businesses are one of the fastest growing segments of small business development. Martin Leham, with SCORE, Counselors to America’s Small Businesses, says new companies that make it through the recession will likely be stable and have good reason to believe they will survive long-term.

“Running a business is a day-to-day thing,” said Leham. “I tell people, it’s a 25-hour-a-day job. And you have to know what you did yesterday and what are you going to do tomorrow.”

Not all new businesses succeed. According to the U.S. Small Business Administration, only seven out of 10 newly formed companies make it past the two year mark, and half survive five years.

For the Carpenters, it’s a risk worth taking.

“What I hope this restaurant will do for my children is show them that they have the ability to do their own thing,” Jennifer said. “If it’s not taking over the business that we already started, it’s them starting their own business, something of their own, something that they may have a passion for.”

The Carpenters hope their café will break even in spring and turn a profit by the end of next year. In the meantime, they plan to keep serving generous portions of steak and eggs and the crowd favorite banana frosted pancakes, as well as healthy fare like seared salmon, grilled chicken and blacken tilapia.

Lemonade’s not on the menu but it is sure in the air.