The History of Black Entrepreneurship in Chicago

Chicago is unique among major American cities in that its first non-Native American resident, as well as its first entrepreneur, was Black. Although much of the life of Jean Baptiste Point Du Sable (1745–1818) remains unknown, his skills as an entrepreneur are well documented. As Thomas A. Meehan, a biographer of Du Sable, noted, “it is remarkable that every contemporary report about Du Sable describes him as a man of substance. Undoubtedly, he owned one of the most complete [trading] establishments in the Middle West outside of Detroit and St. Louis.” Based upon the example set by Du Sable, it is perhaps not surprising that succeeding generations of Black entrepreneurs in the Windy City likewise distinguished themselves in the realm of business.

John Jones, arguably, was the most significant Black entrepreneur in nineteenth-century Chicago. A skilled tailor, he was the first Black businessperson to operate an establishment in downtown Chicago. His net worth was estimated to be $10,000 in 1860 and by the time of the Great Chicago Fire of 1871 some estimates placed that figure at $100,000. As the city’s leading Black businessman, Jones also assumed civic and political leadership roles. He coordinated the legal fight to end discriminatory Black Codes in Illinois in 1865. In 1872, Jones made history by being elected to the Cook County Board of Commissioners. This was the first time that a Black person assumed such a position in the State of Illinois.

By the late nineteenth century, the number of Black entrepreneurs and professionals in the city had significantly increased. In 1885, Isaac Counsellor Harris sought to spotlight this segment of Chicago’s population by compiling and publishing Black Chicago’s first business directory, The Colored Men’s Professional and Business Directory. This publication documented the diverse ways that Chicago Blacks were accumulating wealth. Compared to the pre–Civil War era, Blacks now had moved into such areas as real estate, retail furniture, undertaking, catering, saloon ownership, and various other professions.

By the dawn of the twentieth century, the expanding Black business sector in Chicago had established the South State Street corridor as the hub of local Black business activity. One of the leading Black Chicago enterprises to emerge during this period was Robert Abbott’s Chicago Defender newspaper. Established in 1905, the Defender would go on to achieve both local and national notoriety. Besides providing a venue for local Black enterprises to market their goods and services, the Defender actively urged southern Blacks to leave the Jim Crow South and move to Chicago to take advantage of enhanced social, occupational, and political opportunities.

Jesse Binga was another prominent figure in Chicago’s early twentieth-century Black business community. In 1908, Binga opened the city’s first Black-owned bank (the Binga Bank) at 3637 South State Street. Before the establishment of the Binga Bank, Chicago Blacks suffered a variety of indignities when conducting business in the city’s White-controlled banks. Later, when the State of Illinois disallowed individual ownership of banks, Binga reorganized the Binga Bank into the Binga State Bank in 1921. Binga’s restructured financial institution continued to provide quality banking services to Chicago Blacks.

While Jesse Binga and Robert Abbott focused their efforts on the specific industries of banking and newspaper publishing, Anthony Overton established a diversified business empire in early twentieth-century Black Chicago. By the 1920s, Overton owned a multi-story building at 3619-27 South State Street that housed the following enterprises he presided over: the Overton-Hygienic personal care products company, the Douglass National Bank, the Victory Life Insurance Company, and the Chicago Bee newspaper. Because of this spectacular commercial accomplishment, Overton, in 1927, became the first businessperson to be awarded the NAACP’s prestigious Spingarn Medal.

Besides the more well-known trio of Anthony Overton, Jesse Binga, and Robert Abbott, Frank Gillespie emerged as a major figure in Black Chicago’s early twentieth-century business community. Gillespie was the president of the Liberty Life Insurance Company. In 1919, Liberty Life made history by being the first Black-controlled legal reserve insurance company established in the North. Within a couple of years, more Black insurance companies (including Anthony Overton’s Victory Life) were established in the Windy City. These financial institutions, coupled with the Binga State Bank and the Douglass National Bank, contributed to Black Chicago (increasingly known as Bronzeville) being regarded as a hub of Black business activity in America.

The 1930s Great Depression had a devastating effect on Chicago’s Black business community. Previously successful enterprises, such as the Binga State Bank and the Douglass National Bank, were casualties of the severe economic downturn. However, during this economic nightmare, a long-standing controversial business activity rose in prominence.

“Policy,” a Black-controlled forerunner of today’s government-sponsored lotteries, had existed in Black Chicago years before the Great Depression. The so-called “Policy Kings” who controlled this aspect of the underground economy made a point of reinvesting portions of their profits back into the community. They also provided employment opportunities to working-class local Blacks, as well as loans to local Black entrepreneurs who couldn’t get funding from traditional banks. Shrewdly, to protect themselves from police harassment, “Policy Kings” paid off unscrupulous White politicians.

During the Great Depression, the Jones Brothers (Edward, George, and Mack) emerged as the most influential “Policy Kings” in Chicago and the nation. In fact, the April 18, 1938, issue of Time magazine featured an article entitled “Business in Bronzeville” which included a discussion of the Jones brothers’ economic influence. Among other things, readers were informed that the Jones brothers in 1937 established “the world’s only Negro-owned department store.”

During the early 1940s, war-related employment put local Blacks back to work and helped to resuscitate the traditional Black business community. One of the leading Black Chicago entrepreneurs to emerge during this era was John H. Johnson. In 1942, Johnson began publishing Negro Digest, a Black version of Reader’s Digest, which re-printed a wide variety of articles about Blacks previously featured in various Black newspapers. In 1945, Johnson began publishing Ebony magazine, a Black version of Life magazine (an extremely successful glossy photo periodical).

Above and beyond merely emulating Life magazine’s format, Johnson sought to use his new magazine to achieve two distinct purposes. First, he envisioned Ebony as a magazine that would psychologically uplift its primarily African American audience through focusing upon stories of Black accomplishments and success. Second, he envisioned Ebony as the primary marketing venue for corporations seeking to reach the increasingly important Black consumer market. Using this strategy; Johnson, by the 1960s, had become, arguably, the most important Black businessperson in the country.

The evolution of Ebony magazine coincided with the birth and evolution of the Civil Rights Movement. By the late 1960s, an increasingly self-assured Black American population consciously expressed their sense of racial pride. One manifestation of this was the appearance of the “Afro” hairstyle. The Chicago-based Johnson Products Company, headed by George Johnson, capitalized on this phenomenon through their popular “Afro Sheen” product line. The success of “Afro-Sheen” contributed to Johnson Products being the first Black enterprise to be listed on a major stock exchange in 1973. Also, Johnson Products was the initial corporate sponsor of the popular syndicated television program Soul Train.

The 1980s and ’90s witnessed Oprah Winfrey’s meteoric rise as a media tycoon. Her Chicago-based Harpo (Oprah spelled backward) Entertainment Group initially rose to prominence through its production of the popular syndicated television program The Oprah Winfrey Show. In 1990, Harpo Films, the feature and television film division, commenced operations. In 2000, O, The Oprah Magazine, became another revenue stream for this entrepreneurial powerhouse.

Although the late twentieth century witnessed some dramatic Black business successes such as Oprah Winfrey, it also featured some significant setbacks. For instance, Black Chicago insurance companies, which survived the Great Depression, did not survive increased competition from White insurers for Black clients. Consequently, today, there are no Black-owned legal reserve insurance companies in the Windy City. However, there is a project, coordinated by the Mid-South Planning and Development Commission, which uses the renovated Overton Hygienic Building (built by Anthony Overton in the 1920s) as an incubator for small businesses and startups within the historic Bronzeville neighborhood. In contemporary Black Chicago, there are some promising business formation initiatives in place.

Robert E. Weems, Jr., is the Willard W. Garvey Distinguished Professor of Business History at Wichita State University. He is the author of many books, including Black Business in the Black Metropolis: The Chicago Metropolitan Assurance Company, 1925–1985 (Indiana University Press, 2000), Business in Black and White: American Presidents and Black Entrepreneurs in the Twentieth Century (New York University Press, 2009), and The Merchant Prince of Black Chicago: Anthony Overton and the Building of a Financial Empire (University of Illinois Press, 2020). He served as historical advisor for the PBS documentary Boss: The Black Experience in Business (2019).