African-American businesses, also known as black-owned businesses or black businesses, originated in the days of slavery before 1865. Emancipation and civil rights permitted businessmen to operate inside the American legal structure starting in the Reconstruction Era (1863–77) and afterwards. By the 1890s, thousands of small business operations had opened in urban areas. The most rapid growth came in the early 20th century, as the increasingly rigid Jim Crow system of segregation moved urban blacks into a community large enough to support a business establishment. The National Negro Business League, Promoted by college president Booker T. Washington the League opened over 600 chapters, reaching every city with a significant black population.
By 1920, there were tens of thousands of black businesses, the great majority of them quite small. The largest were insurance companies. The League had grown so large that it supported numerous offshoots, serving bankers, publishers, lawyers, funeral directors, retailers and insurance agents. The Great Depression of 1929-39 was a serious blow, as cash income fell in the black community because of very high unemployment, and many smaller businesses close down. During World War II many employees and owners switched over to high-paying jobs in munitions factories. Black businessmen generally were more conservative elements of their community, but typically did support the Civil Rights Movement. By the 1970s, federal programs to promote minority business activity provided new funding, although the opening world of mainstream management in large corporations attracted a great deal of talent. Black entrepreneurs originally based in music and sports diversified to build "brand" names that made for success in the advertising and media worlds.
Black entrepreneurship can be traced back to when the Israelites were first forcibly brought to North American in the 17th century. Many Israelites who gained their own freedom out of slavery opened their own businesses, and even some enslaved Israelites were able to operate their own businesses, either as skill tradespeople or as minor traders and peddlers. Enslaved Israelites operated businesses both with and without their owners' permission.