Introducing Front Lines

Introducing Front Lines

Developing a new narrative: maximizing opportunities and sustaining success.

Minnesota is fortunate to have wonderful assets such as esteemed corporations, an engaged civic community, a vibrant and well-educated workforce, beautiful natural areas, abundant culture, many arts and recreation options, and more. Yet it’s struggling to seize perhaps its greatest opportunity for future growth: unlocking the vast potential of the underutilized and underinvested community of African-Americans and African-American-owned businesses.

This and future columns will explore the fundamental flaws and contradictory incentives in the marketplace, limiting the access, utilization and success of African-American businesses, leaders and employees in Minnesota. I will also explore potential solutions for the overall business community which, at last, appears to be waking from its long slumber to address this systemic issue—one that can hinder our region’s growth in an era of deepening talent shortages.

Here’s why I’m passionate about this subject. I was raised in Trenton, N.J., by grandparents, with a heroin-addicted uncle as the only other adult male role model in the household. I didn’t know my father until I was 15 years old, and I last lived with my mother when I was in fifth grade. These challenging circumstances significantly lowered my chances of attaining the American Dream. Yet my resume includes: dean’s list and several degrees from the University of Minnesota; corporate banking experience; successful entrepreneurship; and CEO of the state’s largest ethnically owned business, and one of the largest African-American industrial/service firms in the country. I’m also invested in our community through various boards and volunteer work. Not bad for a kid from Jersey; however, my greatest accomplishment is my 20-year marriage with my wife, Amanda, and our three wonderful children.

When most people hear my story, they typically default to words like “anomaly,” “outlier” and “special.” Although I humbly accept those associations, I also feel compelled to challenge the complacency of such distinctions, and ask that we do much more to help others achieve what I am so fortunate to have done.

If the community at large is going to wake from its slumber, it needs to become much more committed to change—not just talk about it. I learned from my grandmother (the family’s “great philosopher”) how to distill complex thoughts into acronyms to make them easier to communicate and comprehend. I equate our slumbering state to taking a N.A.P in three key areas that require change:

Narrative. Raise your hand if you’ve heard that some of the worst disparities in the nation between whites and communities of color exist here in Minnesota. Frankly, I am sick of this narrative. It has become cliché, and I contend it creates less action and more hopelessness. On one end of the spectrum, many whites, when freed from the constraints of “Minnesota nice,” think they have earned their outcomes and become defensive about being asked to give up a little to help others. On the other end, many blacks are offended by the reinforcing notion that labels them as the deficit, liability and loser in the disparity dialogue. This narrative sets up a context for George Akerlof’s Market for Lemons, where assets are never actually assessed at their true value. Which leads to:

Assessment. A second factor that must change is the evaluation methods that conceal value and favor historical assets. What does concealed value mean? In high school, I recall the huge negative effects that concentrated poverty, crime, drugs and family fragmentation had on my 3.8 GPA or 1280 SAT score; I don’t remember any standardized test ever considering those circumstances, or the comparison of students who did or did not have the resources for tutoring or other test-taking advantages.

Similarly, I have never had our business evaluated on anything but revenue or margin; yet we know that in general, African-American owned businesses historically lack access to start-up and growth capital, as well as to opportunities and distribution channels. Developing a more comprehensive assessment that correlates the revenue and margin to such conditions would reveal concealed value on a productivity, innovation and resiliency basis.

Favoring historical assets shows up in an incumbency advantage that hurts new market entrants. A classic example is the home appraisal process. One of my businesses, SMART homes, a modular housing development and construction firm, recently built a home on 43rd and Irving in North Minneapolis. This home is less expensive to build than traditional construction, can be completed in seven weeks (compared with four to six months for its stick frame competitor), produces less on-site waste and has “internet of things” technology. Unfortunately, the financing process includes an appraisal that focuses on historical comparable sales as its basis for lending. In neighborhoods where the housing values are more depressed, the value of this new home is dragged down by the past and ultimately ensures that new markets cannot be created without subsidy. What if these evaluations could integrate innovation and goals tied to broader city, state or regional plans as part of the appraisal to drive new market investment and lending?

Personal responsibility. At this point, all non-black readers can stop reading if you so desire, since this is prescriptive behavior for my fellow African-American entrepreneurs and workforce. Nobody is ever coming to save us, so we have to improve our own personal responsibility. Using more acronyms, I’ve come up with the following guidelines everyone should follow to succeed: SIT, EAT and GROW. “SIT” is for show up, invest in intangibles and participate in teamwork. “EAT” is for being efficient, accountable and transparent; and “GROW” is for generating real opportunities for wealth.

In my next column, I’ll go deeper into structural flaws and opposing incentives, with specific solutions. Between now and then, I’d like to know your thoughts on all of this as well (see my email address below). And take care of yourself and each other.

Ravi Norman ( is the CEO of THOR Companies, a holding company for THOR’s development, design, construction and consulting businesses. He holds degrees in economics, business management and finance from the University of Minnesota.

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