The entrepreneurial efforts of Black business men fueled Durham North Carolina’s Black Wall Street — creating lasting institutions for excellence despite the threat to decimate Black communities with plans of urban renewal, highway construction and segregation.
The Black business community worked to ensure that opportunity in Durham remained available for residents who wanted to create wealth for themselves, so they formed the Durham Business and Professional Chain, an African American business advocacy organization.
“Durham is an amazing place, in the sense that 30 years after slavery there were forward thinking people who thought about what type of systems needed to be put in place so African-Americans in Durham could be productive in their community, state and country” said said Larry Hester, board chairman of Durham Business and Professional Chain.
That rich legacy represents why efforts continue today to make Black business ownership a priority in Durham.
Origin of Black entrepreneurship in Durham
Two African-American entrepreneurs: John Merrick and Charles Spaulding laid the foundation for Black people and their economic stability in Durham, starting in 1898. The men co-founded N.C. Mutual Life Insurance Company, the first black-owned insurance company in the state and, to this day, the largest in the nation.
Because white insurance agencies at the time refused to work with Black residents, N.C. Mutual Life Insurance Company saw the need and opportunity to serve Black families life insurance for end-of-life expenses — a cost that was usually beyond the financial means of African Americans.
Not long afterward, in 1907, local Black communities in Durham wanted to establish banking for themselves, so M&F Bank (The Mechanics and Farmers Bank) was created by seven Black businessmen in Durham: William Gaston Pearson, Richard B. Fitzgerald, J. A. Dodson, S. L. Warren, James E. Shepard, John Merrick, and W. O. Stevens.
This banking effort initiated the self-reliance of Durham’s Black Wall Street, providing residents a way to build wealth and take out loans to start businesses. M&F Bank grew the community economically by investing financial resources– within 20 years of their founding they tripled the number of Black-owned businesses in the city.
“We created an economic system for survival because there was an emphasis on entrepreneurship. For me and many other people growing up in that environment, we knew it was natural to go into business and feel like we could create anything that could be created,” said Hester.
When prominent Black figures heard of the economic success that Durham businesses were having they began to visit the city to see for themselves. Booker T. Washington traveled to Durham in 1910 and saw the efforts of Black businessmen as “captains of industry,” visionaries employing large amounts of African Americans during a time of global economic development.
W. E. B. Du Bois visited in 1912, he attributed Durham’s Black economic success to the tolerance of white residents to Black residents.
Later in 1912, Du Bois wrote about the upbuilding of Black Durham:
“To-day there is a singular group in Durham where a Black man may get up in the morning from a mattress made by Black men, in a house which a Black man built out of lumber which Black men cut and planed; he may put on a suit which he bought at a colored haberdashery and socks knit at a colored mill; he may cook victuals from a colored grocery on a stove which Black men fashioned; he may earn his living working for colored men, be sick in a colored hospital, and buried from a colored church; and the Negro insurance society will pay his widow enough to keep his children in a colored school. This is surely progress.”
N.C. Mutual Life Insurance Company and M&F Bank played instrumental roles in establishing institutions across Durham for Black people, like White Rock Baptist Church, Lincoln Hospital, North Carolina Central University, and the Durham Colored Library (now known as the Stanford L. Warren Library).
Many of the first Black-owned businesses in Durham no longer exist but N.C. Mutual Life Insurance Company and M&F Bank have continued to grow, sustain and provide support to the Black community.
Impact of threats on Black businesses and communities
Black income, wealth and businesses in Durham were hit hard by the city’s urban renewal projects in the 1950s and 1960s. City officials convinced Durham’s Black residents to pass a citywide highway bond referendum that would construct NC Highway 147 from downtown to the Raleigh-Durham International Airport and to a Research Triangle Park.
The project was passed with a 90 percent Black vote on the confidence that this would provide the center of Black life in Durham new housing, new commercial developments and major infrastructure improvements.
Prior to these urban renewal projects, Black life in Durham thrived on Parrish Street also known as the city’s Black Wall Street. This area lived on a four-block district in what is now Downtown Durham.
This Black financial district was pushed out of the area by urban renewal and the financial desegregation that followed. More Black consumers began shopping with white businesses cutting off the funnel of wealth being poured back into Black businesses and communities.
The Black residential district that bordered Parrish Street, known as the Hayti district, was impacted by the highway too. Urban renewal displaced 4,057 households and 502 businesses affecting an overwhelming amount of Black residents.
Durham’s Black residents trusted that the city’s plans would eventually benefit their communities and business, but Black residents have continued to suffer economically in the years since with little to no support from the city.
Preserving Black businesses
The loss of Black businesses in Durham has had a devastating and lasting effect on entrepreneurship, but groups like Durham Business and Professional Chain continue to enrich the local Black business community through networking events, resource sharing and youth mentorship.
Their vital role in Durham’s Black business scene has landed the city a ranking as one of the top 10 places where Black Americans do best economically.
“Cities and governments have to change the mold and invest in communities that they are not used to investing in, especially places that have the potential and resources to do so. I think cities have to remember that they have a population that has been denied for hundreds of years and now we have to look at how to get everybody to the same place so we can compete with the world,” Hester said.
Despite this ongoing work, Black business ownership in Durham continues to face challenges in 2021. COVID-19 relief funds have disproportionately left out Black businesses, which comprise only 4.7% of businesses in Durham.
As a result, the total number of Black businesses in North Carolina has decreased by 41% since the start of the pandemic, according to estimates from the North Carolina Business Council.
Hester shared his advice for Black business owners: “Believe in yourself and that you can succeed. Always try to solve the problem when you get to an issue that seems to be overwhelming. If you stop and look around, you can be flexible and look at solutions, then try and see if it works. There is no such thing as an instant genius, we all learn. And you don’t know what you don’t know; therefore you should be always learning and taking that back to your business.”
Saving Places: How communities are working together to preserve historic places
Around the South, historic neighborhoods and important cultural sites are under threat. In some cases, it’s because of development. Others have simply languished as community members grew older and properties fell into neglect. Still others might be swallowed up by the effects of a warming global climate. Reckon is introducing you to some of these Southern places, why they’re threatened and the people who are fighting to preserve them. Read those stories here.