There was a time when Chicago was the place for Black businesses to thrive. During the 1970s especially, the Windy City was a virtual Back business powerhouse but the landscape changed. By the 1990s, Black-owned businesses were on the decline as a result of disinvestment, globalization and the nationalization of local businesses.
Before the businesses disappeared, the city was filled with Black-owned stores, a pharmacy, dentists, a nightclub, a funeral home, and a Black-owned bank — Independence Bank of Chicago — with more than $100 million in assets, Politico reported.
Chicago was once the capital city for Black millionaires and businesses, with one of the nation’s largest concentrations of Black residents. These businesses weren’t just regional, they had a national and global reach. Worldwide brands such as Ebony and Jet magazines and Afro Sheen hair care products were all headquartered in Chicago.
Later, Oprah Winfrey and her Harpo Studios opened in Chicago. While Harpo has remained, most of the other standout Black-owned, Chicago-based businesses have disappeared.
Chicago was home to the country’s biggest Black bank, Independence Bank. Alvin J. Boutte Sr. was the bank’s co-founder, chairman and CEO.
Before launching the bank, he opened and operated a drugstore which grew into a chain of stores across the Black neighborhoods of the city, Black Past reported.
To establish Independence Bank, Boutte partnered in 1964 with fellow Black business leader George Ellis Johnson Sr., whose Johnson Products Company manufactured Ultra Sheen and Afro Sheen. Johnson Products was the largest Black cosmetics company in the U.S. Bouette also partnered with Ebony Magazine founder John Johnson (no relation). Ebony was the largest Black-owned magazine in the country.
In 1988, Drexel National Bank, another South Side Chicago Black bank, acquired Independence Bank. By 1995, it had neem sold again, this time to white-owned ShoreBank.
Entrepreneur John Johnson was the leading 20th Century publisher of African American media, having founded Ebony and Jet magazines.
But before Ebony and Jet, there was Negro Digest. In 1942 with $500, John Johnson sold subscriptions and with the earnings published Negro Digest (later renamed Black World). Three years later, Johnson launched Ebony. It was similar to the successful white pictorial publication Life magazine but Ebony chronicled Black life. In 1951, Johnson began publishing the weekly Jet magazine, which reported Black news. They were all successful and in 1982, Johnson became the first African American to appear on the Forbes list of wealthiest Americans, Black Past reported.
John Johnson later expanded into fashion, cosmetics, and insurance.
In 1972, media mogul John Johnson created Fashion Fair makeup and the legendary Ebony Fashion Fair traveling fashion show.
George Johnson, Sr. was the founder of the hugely successful Johnson Products Company, a hair care firm.
In 1954, he founded the firm with his wife, Joan (Henderson) Johnson with just $500. Johnson developed his first products exclusively for male customers. Their first success was Ultra Wave Hair Culture, which was a hair relaxer for men, Black Past reported.
In 1957, Johnson Products debuted a new hair straightener specifically for women called Ultra Sheen. As natural hair grew in popularity with the “Afro” style hair, Johnson developed its most famous product, Afro Sheen. The company started to sell its products globally including in Africa, the West Indies, and Latin America by the early 1970s. Johnson Products Company became the largest African American-owned corporation in the U.S. It became a $100 million-a-year firm.
By 1971, Johnson Products Co. had $12.6 million in yearly sales and became the first Black-owned corporation listed on the American Stock Exchange. By 2004, Johnson Products Company was purchased by Proctor and Gamble Corporation, but in March 2009, a consortium of African American investment firms bought the company.
The power of Chicago’s Black millionaires and businesses helped propel Harold Washington to become the city’s first Black mayor in 1983.
Black business owners played a major part in his campaign. Washington’s fundraising chief, for example, was Al Johnson, whose Al Johnson Cadillac was the country’s first Black-owned Cadillac dealership when it opened in 1971.
In 1986, superstar talk-show host Oprah Winfrey founded Harpo Productions Inc., a film and TV production company. By the late 1990s, Harpo had annual revenues of $150 million with about 200 Chicago employees.
Black businesses in Chicago started to disappear when there was an exodus of Black residents moving down South.
Oprah Winfrey moved Harpo Studios from Chicago’s West Side to West Hollywood, Calif. Significant regional businesses like Independence Bank also disappeared. Black businesses were closing due to disinvestment, globalization and the nationalization of local businesses, Politico reported.
The signs were there. In 1990, three Chicago companies — Johnson Publishing, Johnson Products and Soft Sheen Products — landed in the top 20 of Black Enterprise magazine’s list of the country’s largest Black-owned businesses. But by 2020, only one Black Chicago area business was in the magazine’s top 50 — Baldwin Richardson Foods.
There has been a slow resurgence of Black businesses opening again in Chicago that have global appeal.
“Chicago’s African American entrepreneurs are seizing the moment to scale up their businesses—and create a legacy of generational wealth in the process,” Politico reported.
One such company is the Black Bread Co., owned by Charles Alexander, Mark Edmond and Jamel Lewis.
“As African Americans, we don’t own or make any of the products that we use every day,” Lewis told Politico. He said he believes it’s important for Black entrepreneurs to produce “something that we use every day.”
Another company growing and making a stand in Chicago is the Will Group,s a Black family-run business. Stephen Davis is the founder with daughter Jessica Ashley Garmon as chief operating officer and general counsel, and son Joshua Stephen Davis as president.
Stephen Davis said he is focused on leveraging his financial success “to create jobs in communities that have been abandoned.” Will Group had $70 million in 2021 revenue and made a $20 million investment on Chicago’s West Side earlier this year when it opened a 60,000-square-foot factory and warehouse at 4647 W. Polk St. in the Lawndale neighborhood.
“Our goal is to create a work environment where people can have above-minimum wage, health care and retirement benefits,” Stephen Davis said. “And also create housing so that we can revitalize our community, where there is an ecosystem, where you can buy groceries. I can’t do it by myself, but if we can collectively plant a seed and get it to grow and get other people that are socially conscious entrepreneurs, we could see a difference. I’m counting on it.”
Chicago-based investment company Ariel Investments is thriving, but its CEO gives a nod to the Black businesses that came before.
“In the past here in Chicago, we had these giant Black businesses,” Ariel CEO John Rogers said during a 2021 virtual conversation co-presented by the University of Chicago Booth School of Business. “They employed hundreds of thousands of people and created enormous amounts of philanthropy.”
Rogers said that George Johnson, who founded the haircare company with his wife, Joan, created the now-closed Independence Bank, once the largest Black bank in the country, and buoyed other Black-led organizations with meager resources.
“We need to get back to where Chicago is the mecca, where we had these large Black businesses that hired people, that were inspirations. They were role models,” he said.
The Business Leadership Council works to help grow Black businesses in Chicago. The organization has 170 members representing more than 25 industries from construction and financial services to legal services and information technology, Chicago Business reported.
“Ultimately the takeaway is to create real business opportunities,” said Cory Thames, chief engagement officer. “What you are seeing now are more Black firms that are willing to partner with each other and do strategic alliances so that they can be competitive in the marketplace and go toe-to-toe with your well-known primes.”
Photo: George Ellis Johnson Sr. founded Johnson Products Company in Chicago, creating products such as Ultra Sheen and Afro Sheen, https://aaregistry.org/story/george-e-johnson-was-a-natural-businessman/