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On January 11, Monique Rodriguez, founder and CEO of multi-million dollar natural hair care brand Miele Organza, announced that she was selling her company to P&G Beauty, taking dark Twitter to Madness. Although Rodriguez and her husband will remain CEO and COO of the brand, some Users were upset to see that it was no longer black-owned.
“I don’t want to hear anything about supporting black businesses because the second black companies get all the support they want from black dollars and hand it all over to the guy with the big check,” said one Twitter user.
For black entrepreneurs, success in business can be a double-edged sword. Some consider selling your company — often for millions — a huge accomplishment, but black founders are constantly scrutinized by friends and clients for making this choice.
Another black entrepreneur He faced a similar backlash in 2017. Richelieu Dennis is the co-founder of Sudial Brands, which revolutionized the natural hair care business when its product, Shea Moisturizer, hit shelves in 2008. For an estimated 1.6 billion dollars, the name of the sale was called.
Rodriguez said she and Dennis were ‘selling’ the move – not selling – and that the backlash was caused by a lack of general knowledge about building a business.
“People don’t understand how hard we work as business owners,” Rodriguez told CNBC’s Make It. “People don’t understand what it takes to scale … When we’re on the shelves in retail, we have to fight. When we’re up against these big companies, for our state. Our community doesn’t know what it’s like to be a business owner.
We were nervous when we talked about our deal.
Rodriguez and many other black founders share a similar approach to getting their businesses off the ground — draining savings and putting any money back into the company.
“By starting a black woman company, the banks won’t believe you. You haven’t proven yourself so that investors don’t believe in you. [either]. So I had to start up, I had to use my salary and my husband’s bank account… everything goes into the business.
While Rodriguez was making it work, in the long run, she knew it wouldn’t be sustainable. But with the success of her product, she began to attract the attention of investors, and in 2021 she got her first ““Historic” deal: $100 million in funding from Berkshire Partners, a private equity firm — a feat she’s reluctant to share.
“When we talked about the Berkshire deal, we were scared because the community was going to look at us like, OK, they’ve partnered with this white corporation, but people make that assumption because they don’t understand business.”
Selling as opposed to selling
This term is easily discarded by many black consumers when black entrepreneurs partner with or sell their companies to — and often white-owned — conglomerates. However, the pool of black-owned conglomerates is thin, and they often have no other choice.
“If there were black conglomerates, and black big, private equity firms and partnerships that would allow us to put in capital and grow, we would go to these black companies,” Rodriguez says. “But if you can think in the universe, where are those companies? There aren’t any. So where do we go to get the money and the capital to scale?”
Rather than classifying these entrepreneurs as sales, Rodriguez says people should view partnerships, investments and acquisitions as opportunities to sell.
“It’s not about selling, it’s about selling to grow and grow your company … to take that wealth and give it back to the community.”
Using Shea Moisturizer as an example, Rodriguez noted that despite the setback, the brand still operates on the principles laid out by Richelieu Dennis, and since the acquisition, he has been able to create the New Voice Fund, a venture capital firm dedicated to supporting entrepreneurs. Invest in businesses of color and many black-owned businesses.
The importance of an exit strategy
Having a successful business is a great achievement, but who is to say that a person wants to own a business for the rest of their life?
“some [entrepreneurs] He may have a goal of running a business forever or, like everyone else, he may want to try new and rewarding things in his career, says Angelina Darisau, career coach and diversity expert. Black business owners must have the ability to work. And so.”
The decision to sell a business is sometimes on the fly, according to Darisow, “One of the main things in any business course, or even when writing your business plan, is asking an entrepreneur to think about. What is their exit strategy?”
“For founders like Monique, it’s long-term important to have exits … to be able to have high-net-worth individuals who can support, raise funds and invest in other businesses so that we don’t see these poor statistics, like Less than 1% [of Black founders] Being able to invest $1 million. Therefore, successful black founders need outlets so that they can pour capital into our community over time.
Before P&G’s beauty acquisition was announced, Miele Organza went viral after white influencer Alix Earl encouraged her followers to buy the brand’s rosemary mint oil. As a result, the product flew off the shelves nationwide, making it difficult for black women who relied on it to access it.
Not only will Rodriguez’s ownership “accelerate” the brand to more black women, but Miele and P&G have both pledged $10 million to expand the impact of Miele Cares, a charity that provides education, economic opportunity and business relief to black communities.
Rodriguez urged people to honor the black founders instead of tearing them down.
“If we continue to talk bad about people who make wise and strategic decisions, we can’t move forward as a community and create generational wealth in their communities. Congratulations to formalizing these collaborations and selling these brands to create wealth and support and help the black community.”
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