The idea for Dianne Austin’s business grew from a very personal need. In 2015, she was diagnosed with breast cancer and underwent chemotherapy. As she began losing her hair from the treatments, Austin went to the hospital’s cancer-center boutique for an afro-textured wig that resembled her natural hair.
The hospital didn’t have one, and a nationwide search revealed that Austin was not the only women of color who had nowhere to turn for this medical need.
In 2019, Austin co-founded Coils to Locs with her sister Pamela Shaddock to provide afro-textured wigs to women experiencing hair loss. The company operates out of Fields Corner Business Lab in Boston and provides wigs to a dozen hospitals and medical centers across the country.
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Coils to Locs is on the verge of launching a new business model: An e-commerce site to sell its wigs directly to consumers. Austin has taken advantage of several grants and programs to get to this point, many of which popped up over the last two years to support Black-owned businesses. While Austin is grateful for the support, she’s also concerned that these programs won’t stick around, leaving businesses like hers with fewer avenues to success.
“I feel like last year, in particular, there were so many of those types of grant opportunities available that were targeting Black-owned businesses,” Austin said. “I definitely have noticed that it has slowed down.”
Austin has applied and been accepted to several programs, including the FedEx E-Commerce Learning Lab, and received financial support like a Power Forward Small Business grant, which was launched by Vistaprint, the Boston Celtics Shamrock Foundation and the NAACP to support Black-owned small businesses in New England. Coils to Locs received $25,000 last summer.
Access to capital
Many grants and programs serving entrepreneurs of color launched following the murder of George Floyd by police in 2020, including both of these programs that supported Coils to Locs. However, just two years after a nationwide racial-justice movement, Austin is already seeing a decrease in the number of programs for entrepreneurs of color.
“I do see a drop-off. I think it will impact businesses like ours, because already for businesses of color it’s so difficult to get funding,” Austin said.
In 2021, only 0.4% of venture capital in Massachusetts went to startups with Black founders. Black business owners are turned down for loans at twice the rate of white business owners, according to a report from the U.S. Federal Reserve. And raising a friends and family round for Black founders can be difficult, especially in Boston, where there is a huge disparity in the median net worth for white and Black households.
“I think businesses have been very earnest in their interests, it seems, to support Black businesses … and not just Black businesses, but businesses of color,” Austin said. “But I think as time passes, people move on to other things, and that’s what I suspect is sort of, maybe, what we’re seeing.”
Austin said it’s unlikely there are enough equity-free grants available to help Coils to Locs scale, so she’s actively looking at other options like crowdfunding, bank loans and building the company’s revenue with the e-commerce site. Coils to Locs may also launch white-label products, like shampoo and conditioners, to supplement wig sales.
While she’s open to discussions with investors, Austin’s goal is to scale the company without giving up all the two co-founders’ equity.
“We just feel strongly about keeping as much ownership as possible and trying to figure out what that delicate balance might be,” Austin said. “If there was the right sort of match in interests…we would be totally open to it.”
