Supporting Black Business Ecosystems: Lessons From Durham’s Black Wall Street – MIT Sloan

The winter 2022 issue of MIT SMR explores ideas to help leaders keep their organizations at the forefront of innovation.
The winter 2022 issue of MIT SMR explores ideas to help leaders keep their organizations at the forefront of innovation.
Companies can build diverse and inclusive business ecosystems using a cooperative advantage approach.

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Last year marked a century since the Tulsa Race Massacre, when, on May 31, 1921, the area known as Black Wall Street in the Greenwood district of the Oklahoma city was burned to the ground and approximately 300 of its residents were killed by an angry White mob.
During that same time period, a thousand miles away, the neighborhood known as Hayti in Durham, North Carolina — arguably the area’s own Black Wall Street — was thriving. In fact, by the end of 1921, the North Carolina Mutual Life Insurance Company (NC Mutual), which had been founded in 1898, moved its headquarters from Hayti to a luxurious, modern building in Durham’s largely White downtown. The new six-story building became a symbol for Durham as the “capital of the Black middle class,” as sociologist E. Franklin Frazier would later put it.
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Why were the experiences of these two Black business communities so different, and what can they teach us about how to encourage Black entrepreneurship and business today?
Hayti’s long-lasting success compared with other Black Wall Streets around the country had much to do with the cooperation between the Black and White business communities. This ecosystem helped African American entrepreneurs overcome the three barriers they faced after slavery: access to funding, the acquisition of business skills, and intolerance and extreme racism.
A century later, there is much we can learn from these examples from the past. In order to facilitate diverse and inclusive business ecosystems today, we must be authentic and move beyond performative allyship. That means robustly engaging in the types of cooperation that will help build the sustainable cities and communities that we desperately need to facilitate social sustainability in underserved communities.
Durham’s historic Black Hayti District, christened after the former French colony in the Caribbean that freed itself from slavery, was itself founded immediately after the Civil War by former slaves from nearby Stagville Plantation, one of the largest plantation complexes in the American South. African Americans with their own bold dreams established, owned, and led industrial works, retail services and shops, churches, schools, community organizations, a library, and a hospital. Home to more African American millionaires per capita than any other city in America by the early 20th century, it attracted the attention of luminaries such as W.E.B.
Leon C. Prieto (@leoncprieto) is an associate professor of management at Clayton State University and an associate research fellow at the Judge Business School’s Centre for Social Innovation at the University of Cambridge. Simone T.A. Phipps (@drsimonephipps) is an associate professor of management at Middle Georgia State University and an associate research fellow at the Judge Business School’s Centre for Social Innovation. Henry C. McKoy Jr. is the director of entrepreneurship and a faculty member at North Carolina Central University’s School of Business and a former senior fellow at the Ash Center for Democratic Governance and Innovation at Harvard’s Kennedy School of Government.
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