Angela Muhwezi-Hall and Deborah Gladney founded QuickHire, a recruitment platform during the pandemic.
When the coronavirus pandemic shut down businesses across the country, sisters Angela Muhwezi-Hall and Deborah Gladney decided it was the perfect time to start a new one.
An idea they have been brooding over for years: A hiring platform called QuickHire, which is supposed to help service and skilled workers with their job search. They witnessed what they called the antiquated hiring process among small operators and also knew the importance of this type of work.
“Covid was definitely the catalyst when we saw millions of people lose their jobs [and] People have had to retrain, “said Muhwezi-Hall, 31, who quit her job as a university advisor at a university in California to start the company in her hometown of Wichita, Kansas.
The sisters have pooled $ 50,000 from their savings and 401 (k) plans due to be launched in September and recently secured a $ 350,000 investment from an angel investor.
More from Invest in You:
Guy Fieri is on a mission to save restaurants affected by a pandemic
This is how these small businesses evolved to survive during Covid
“Huge” opportunities await women entrepreneurs, says venture capitalist
“We feel this is the perfect time,” said Gladney, citing the labor shortage many companies face when trying to get back up.
Muhwezi-Hall and 34-year-old Gladney, who quit her job as a PR consultant, were part of the founding push in the USA last year. According to the US Census Bureau, around 4.3 million new business applications were submitted in 2020, nearly 1 million more than in 2019.
“In a recession we hardly ever experience a boom,” says Luke Pardue, economist at Gusto, the wage and social service provider.
Most of the new companies were founded by women and people of color, according to the company’s latest survey. In 2020, according to Gusto, 11% of new business owners were Black or African American, compared with 3% in recent years, and 49% were women, compared with 27% in recent years. From April 4 to April 16, 1,568 new business owners who started in the pandemic were surveyed.
“This is no coincidence,” said Pardue, who pointed out that 51% of owners started their business out of economic necessity and a third said they did because they lost their jobs.
“Women and people of color were the ones who bore the brunt of the recession last year,” he added. “They were resilient and turned obstacles into opportunities.”
From speech therapist to smoothie
Source: Ashley Walker
When Ashley Walker, 34, opened her Smoothie Me Please business in Riviera Beach, Florida in January, she had something that many other entrepreneurs don’t have: financial support from her city.
The single mother received a grant from the city’s municipal redevelopment agency two years ago. The location, an empty building, was then redeveloped by the city. She’s been working rent-free there for six months now, and the remainder of her three-year contract includes very affordable rent, Walker said.
“It was the perfect time to risk it all because I had the support,” said Walker, who worked as a speech therapist before opening her smoothie shop, which also sells sandwiches and popsicles.
But not everything went smoothly. Construction was delayed due to Covid and it was difficult for her to get a business loan. A potential investor also failed. Eventually she took out a $ 15,000 personal loan to pay for marketing and equipment.
But Walker is already making a profit thanks to the lack of rent payments. She’s not the type to worry, she said when asked when these payments will start.
“Everything I need fits together,” said Walker. “I am confident that things will work and we will make the necessary adjustments as the market changes.”
A question of survival
Justin Sullivan | Getty Images News | Getty Images
The support Walker has received is an example of help new business owners should have access to, believes Pardue of Gusto. This help could be critical to their survival.
About 20% of small businesses fail in the first year. However, 51% of owners in Gusto’s survey believe they will fail within the next 12 months without additional support. Meanwhile, 73% of black owners and 71% of Asian / American / Pacific islanders say the same thing.
“Ultimately, this could worsen the gender and racial gap even further as these business owners could experience business failures a year later,” Pardue said.
He advocates replenishing the paycheck protection program that gave small businesses forgivable credit and empowering these new owners. He also wants the Small Business Administration to reconsider the way aid is being given and who it is reaching, such as women and minorities.
“The conversation can’t end with ‘This is an inspirational trend’,” he said.
“We need to think about how we can support these new businesses because new, young businesses are the engine of job growth in the economy.”
SIGN IN: Money 101 is an 8-week financial freedom learning course delivered to your inbox weekly.
CHECK OUT: I’m a mother of 3 whose part-time job is now a full-time job that brings in $ 5,000 a month: Here’s my best advice about Growing with acorns + CNBC
Disclosure: NBCUniversal and Comcast Ventures are investors in Acorns.