- Asian Americans own 10% of small businesses in the US, but AAPI entrepreneurs still face challenges.
- Arnold Byun and Kioh Park founded MAUM to create a space for AAPI entrepreneurs to thrive.
- They see challenges like limited access to capital and hope to create a welcoming, empowering community.
Small businesses are the backbone of the US economy, and Asian-owned businesses make up an important part. While Asian Americans make up just 7% of the nation’s population, they currently own 10% of businesses across the US. Twenty-six percent of hospitality businesses, 17% of retail, and 11% of education services are Asian-American-owned.
Despite that, AAPI entrepreneurs still face unique struggles. Arnold Byun and Kioh Park, cofounders of the LA-based MAUM, are providing a platform for AAPI entrepreneurs to launch their business ideas and provide a link between their brand and audiences. Byun is a 27-year-old who identifies as Korean-American and is a community connector and brand consultant, and Park, who is 32, identifies as Korean and is the founder of Kioh Tea.
Launched in January 2022, MAUM has a monthly marketplace featuring Asian artists and entrepreneurs. MAUM also recently launched MAUM General Store, a brick-and-mortar shop featuring Korean-founded brands. MAUM has grown its network to 500 makers, and has plans to expand to other major cities across the US.
As they’ve collaborated with their network of makers, Byun and Park have identified five challenges that need to be overcome to let AAPI entrepreneurs thrive.
1. Limited access to capital
While access to capital is a challenge in entrepreneurship across the board, Asian Americans tend to bootstrap and lean on friends and family. In Byun and Park’s case, they founded MAUM by taking a check they received from a sponsor and buying 10 tables for their first pop-up market.
“I think a lot of AAPI business owners are scrappy, and if they need to raise money, they’ll probably go to friends and family first,” says Byun. “I also think that there’s not a lot of knowledge or resources being really shared to some of the small business owners. A lot of them don’t even know how to access capital.”
A lot of makers who sell goods at MAUM Market have day jobs and sell their products on the side. “They still have a full-time job and want to make this transition, but that transition is very difficult,” says Byun. “They have to pay for rent and all these expenses, but they’re not able to make that jump.”
This could be partly chalked up to challenges to applying for funding. Fifty-eight percent of AAPI entrepreneurs have struggled with federal, state, and local programs to help small businesses. Organizations such as National ACE, ACE NextGen, Asian American Business Development Center, and National CAPACD provide resources and grants for AAPI-owned businesses.
2. Fear of borrowing money
Particularly for first-generation Asian Americans, people might be a little fearful of loans and hesitant to borrow money from a bank. In many cases, that’s just something they’re not accustomed to, says Byun. “For the first generation that maybe is more comfortable in their native language, that could be an issue,” he says.
A good step is to learn the ins and outs of the US Small Business Administration’s funding programs for small businesses. Business loans and business lines of credit also come in handy. Programs such as the SBA-funded Score can help entrepreneurs walk through different options and learn how to apply.
3. Lack of venture capital opportunities
When it comes to venture capitalists and VC firms investing in companies, Byun sees it as only tapping into their current network. “The circle is very small, and it just continues inside this bubble,” he says.
“We just need more diversity, not just in small businesses, but in the investment firms and the VCs and the decision makers at those companies that have the capital, to say, ‘Hey, let’s look at a more diverse set of faces and companies that maybe we can invest in.'”
4. Devaluing their offerings
From what they’ve witnessed, Asian American business owners tend to devalue their own culture or goods. For example, as Park explains, a fellow Asian might walk into the MAUM General Store and say, “Oh, I can make this at home — why is it so expensive, and why do I have to pay out this much money?” But from non-Asians and allies, they want to learn about other cultures and their goods.
AAPI makers should also be wary of meeting with a larger corporation who claims they want to collaborate, but end up “borrowing their ideas” without properly paying them, says Park. For example, one of their makers was creating candles. A large manufacturer asked them to have a meeting. Several months later, the manufacturer launched a collection that was very similar to the maker’s.
5. Competition instead of community
Byun and Park both feel that allyship starts from within. “It’s about being an ally to ourselves, celebrating ourselves and not pitting ourselves against each other,” says Byun. “There’s a greater purpose and greater mission here. People talk about having a seat at the table, but I don’t want to sit at that table. Why don’t we just make our own table, and you can all sit with us?”
“We always try to make MAUM a community over competition,” adds Park. “We have been able to grow really fast in this short time period because we’re literally open to just including everybody.”
“The biggest thing within our community is just being able to celebrate one another,” says Byun. “And really coming at this from a lens and perspective of like, hey, we’re here for the same reason. We all want to make it together.”