Systemic Barriers Hinder Minority Business Growth in US

A recent executive order has initiated the dismantling of the Minority Business Development Agency (MBDA), a move that has drawn concern regarding its potential impact on minority economic advancement. This decision threatens decades of progress in supporting minority entrepreneurship and access to economic opportunity.

Since its establishment, the MBDA has served as a resource for the over 12 million minority-owned businesses in the United States. In 2024 alone, the agency facilitated access to over $1.5 billion in capital. Its dissolution represents the loss of a government agency and a critical bridge to economic opportunity for marginalized communities.

Historical Context

The timing of this decision has prompted comparisons to historical instances of systematic suppression of minority economic progress. The 1921 destruction of Tulsa, Oklahoma’s Greenwood District, often referred to as “Black Wall Street,” serves as a stark example.

Before the attack, Greenwood was a thriving Black community with hundreds of Black-owned businesses, including hotels, restaurants, grocery stores, and a movie theater. In less than 24 hours, white mobs destroyed 35 city blocks, burned over 1,200 homes, and obliterated years of accumulated wealth. The direct property damage exceeded $200 million in today’s dollars, with the broader economic impact—lost generational wealth and stunted development—being incalculable.

Similar attacks on minority economic progress occurred in Rosewood, Florida; Wilmington, North Carolina; and numerous other communities across America. These events involved the systematic dismantling of economic infrastructure supporting minority advancement. The current dismantling of the MBDA, while occurring through executive orders rather than physical violence, is viewed by some as having a similar effect.

Impact of MBDA Dissolution

The elimination of the MBDA’s support will result in minority entrepreneurs losing access to several key resources. These include specialized business consulting services, networking opportunities, capital access programs, federal contracting pathways, and export market guidance.

Potential Strategies for Continued Support

Despite the challenges posed by the MBDA’s dissolution, opportunities for innovation and resilience exist. Drawing on historical examples of community rebuilding, such as the rapid recovery of Greenwood, the minority business community can forge new paths forward.

Several strategic steps can help ensure continued support for minority enterprises. State and local governments should expand their minority business development programs, establishing dedicated offices and funding streams for technical assistance, access to capital, and procurement opportunities.

Private sector institutions, including major banks and corporations, should create dedicated minority business funding programs as strategic investments, recognizing the $4.7 trillion annual buying power of minority communities. Community foundations, CDFIs, and MDIs, which have historically supported minority businesses, require increased capitalization to fill the gap left by the MBDA.

Professional organizations and chambers of commerce focused on minority businesses should broaden their programming to include services previously provided by the MBDA. Technology platforms and fintech companies should develop specialized tools and products to democratize access to capital and business services for minority-owned businesses.

The dismantling of the MBDA presents a significant challenge, but it does not preclude the continued advancement of minority business development. History demonstrates that attempts to suppress minority economic progress often spur innovation and resilience. Ensuring the success of all entrepreneurs, regardless of background, is essential for American economic prosperity and a more pluralist economy.

Rev. Dr. F. Willis Johnson is a spiritual entrepreneur, author, scholar-practitioner whose leadership and strategies around social and racial justice issues are nationally recognized and applied.