How to Get Certified as a Minority-Owned Business

Minority-owned business certification offers entrepreneurs of color and other underrepresented groups opportunities for networking, training and the ability to compete for government contracts. There are multiple certifications available; which one to choose depends on how you’ll use it.

What defines a minority-owned business?

To qualify as a minority-owned business, most programs require that the majority of your business be owned by a person of color, though specific requirements may vary by program.
According to the National Minority Supplier Development Council (NMSDC), this means 51% of the business must be owned by a person who is at least 25% Asian, Black, Latino or Native American. That minority business owner also needs to take part in the day-to-day management and operation of the business.
Certifications are also available to women-owned and LGBTQ-owned businesses, both underrepresented groups when it comes to business opportunities and capital, and those programs have their own eligibility requirements.

What are the benefits of minority business certification?

The benefits may vary by program, but minority-owned business certification — also called MBE certification — offers business owners of color wider access to opportunities. Programs for women-owned and LGBTQ-owned businesses offer similar benefits. Those opportunities may include:

Bidding on government contracts
Entrepreneurship classes
Coaching or networking with like-minded entrepreneurs
A competitive edge against other businesses, because many private and public organizations prioritize working with MBE vendors
The right to use logos to market your business to supportive members of your community
Help qualifying for certain minority small business grants and minority business loans

7 minority-owned business certification options

There’s no one single place to get certified as a minority-owned business. Here are several federal and state governmental agencies that offer MBE certification. Each has its own application process and unique benefits, so you’ll want to decide what is best for your business.

1. National Minority Supplier Development Council (NMSDC)

• Best for: For-profit businesses seeking to network with NMSDC corporate members and capital firms.
• Cost: Varies by region. Businesses may qualify for application fee reimbursement through the Certification Reimbursement Initiative.
• Qualification criteria: To qualify, your business must be for-profit, located in the U.S. or its territories, and 51% minority owned. Minority ownership members must be U.S. citizens who are “at least 25% Asian-Indian, Asian-Pacific, African American, Hispanic American, or Native American” and must have a role in day-to-day management and operations of the company.

 
The National Minority Supplier Development Council (NMSDC) is a membership organization with 23 regional chapters for minority-owned small businesses. It offers MBE certification which provides access to networking, educational training and contract opportunities.

The NSMDC aims to complete its review process within 30 days. Currently, each regional chapter has its own application process and platform, but the NSMDC is transitioning to an integrated system. Until then, applicants should use their local affiliate’s website to get certified. Once the migration is complete, businesses will fill out a pre-qualification questionnaire to gain access to the integrated application system.

First, you’ll need to upload the required documentation, including proof of eligible minority ethnicity and documents that show your business’s registration, licensure and financial information. A certification team specialist will audit your application, check your references and conduct a site visit or virtual interview. If you’re approved for certification, your business will be added to the database of minority-owned businesses.

2. SBA 8(a) Business Development Program

• Best for: Small, economically disadvantaged businesses seeking federal contracts
• Cost: Free
• Qualification criteria: To qualify for 8(a) certification as a minority business, your small business will need to be in operation for at least two years, and you can’t have participated in the program in the past. Your business must be 51% owned and controlled by U.S. citizens who are socially and economically disadvantaged. You also can’t have a personal net worth of more than $850,000, adjusted gross income of more than $400,000 or assets totaling more than $6.5 million.

 
The Small Business Administration (SBA) offers the 8(a) Business Development Program for minority-owned businesses. The nine-year program offers dedicated one-on-one support, mentorship from more experienced businesses, advice from experts who are trained to understand regulations, and management and technical training from the SBA. In addition, certification as a minority-owned business with the SBA qualifies your business to compete for federal government contract opportunities and receive priority consideration for federal surplus property.

Important: To qualify for the 8(a) program, you’ll need to prepare a social disadvantage narrative. This guide can walk you through the application process. Note that a decision takes up to 90 days.

3. Disadvantaged Business Enterprise program with the U.S. Department of Transportation

• Best for: Transportation industry businesses seeking federal contracts
• Cost: Typically free, but may vary by state
• Qualification criteria: To be eligible to be a DBE, your small business must be 51% owned by socially and economically disadvantaged individuals. Those individuals must have a personal net worth of no more than $1.32 million, excluding primary residence equity and ownership in the firm, and must impact the management and operations of the business.

 
The Disadvantaged Business Enterprise (DBE) program offered by the U.S. Department of Transportation (DOT) offers minority-owned businesses opportunities to compete for federal transportation contracts. By law, at least 10% of DOT funds for highway and transit projects must be spent with DBEs.

When you’re ready to apply, gather the necessary documents and fill out the Uniform Certification Application. You’ll need to contact the state transportation agency in your state to find out where to send it. Approval time may vary by state, but a typical turnaround is 90 days.

4. NGLCC certification

• Best for: LGBTQ-owned businesses
• Cost: $899 (waived for local affiliate chamber members)
• Qualification criteria: To qualify, your business must be “at least 51% owned, operated, managed and controlled by an LGBTQ person or persons.” Your business must have been formed in the U.S. by citizens or permanent residents and must be headquartered in the U.S. as well. A site visit is required, and the review process takes 60 to 90 days.

 
The National LGBT Chamber of Commerce (NGLCC) offers the LGBTBE certification, which allows LGBTQ businesses the chance to compete for corporate and government contracts with the Chamber’s partners. Many state and local governments work with LGBTBEs to achieve their supplier diversity program spending goals, and getting certified can lead to lucrative contracts. Additional benefits include a listing in a database searchable by corporate partners, use of the certification logo and access to educational opportunities such as mentorship, training and scholarship programs.

5. WOSB certification

• Best for: Women-owned small businesses looking to compete for government contracts
• Cost: Free
• Qualification criteria: To qualify for WOSB certification, your small business must be at least 51% owned and controlled by women citizens of the U.S., and women must also manage business operations and make long-term business decisions. To qualify for EDWOSB certification, each woman owner must also have earned no more than $400,000 for the past three years, have a personal net worth of less than $850,000 and have $6.5 million or less in personal assets.

 
The federal government aims to allot 5% of its contracting dollars to women-owned small businesses, setting aside contracts in certain industries that are open only to businesses certified as Women-Owned Small Businesses (WOSBs) by the Small Business Administration. Competition for some contracts is limited further to economically disadvantaged women-owned small businesses (EDWOSBs). Getting certified under the program gives businesses access to federal contracts only available to a limited number of businesses. The certification doesn’t provide the same benefits in the private sector.

6. WBENC certification

• Best for: Women-owned businesses seeking mentorship, networking and other business opportunities with WBENC corporate and government partners
• Cost: $350 to $1,250, depending on business revenue
• Qualification criteria: To be eligible, your business needs to be 51% owned by one or more women. A woman must also hold the highest title in the company’s legal documents and manage and control the day-to-day operations of the business. Certification requires a site visit.

 
The Women’s Business Enterprise National Council (WBENC) offers a certification process that leads to benefits and opportunities for women-owned businesses in public and private sectors. These include networking and procurement opportunities, mentoring, capacity development and other resources. Certified businesses can also use the Women Owned Logo and Women Business Enterprise Seal for marketing purposes and to be recognized by other women-owned businesses in the community.

When applying for WBENC certification, your business can simultaneously apply for the SBA’s WOSB certification if it meets the requirements. WBENC certification is open to more businesses, including those that are not considered “small,” and also provides additional opportunities in the private sector.

7. Minority-owned business certification with state and local governments

• Best for: Small, local, minority and women-owned businesses, particularly those competing in industries not covered by WOSB or DBE certification
• Cost: Varies by state or municipality and program

 
Many states and local governments offer similar programs for minority business certification that come with unique benefits and have their own eligibility requirements. Your state office for minority and women business enterprises is a good place to start. Typically, these programs offer exposure, training, financial assistance and an increased probability of landing government contracts.

Major cities like New York City, Los Angeles, Chicago, Denver and Austin, Texas, all have their own programs as well. For example, New York City’s program provides a listing in a directory promoting certified businesses, networking event invitations and educational opportunities tailored to your business. It’s free to apply. The New York state program, meanwhile, helps women and minority-owned businesses more efficiently secure state contracts.

How to decide what certification to get

When comparing certifications, consider the following:

• Eligibility requirements: You can narrow down your options by identifying which certificate programs you’re eligible for. You may need to meet multiple criteria for some programs. For example, some certifications are only available to small businesses or economically disadvantaged businesses that are also women or minority-owned.
• Your business goals: Depending on your business needs and your industry, you may be looking to compete for government contracts, network with corporations, receive education or training or just stand out when marketing your business. Decide what’s most important to you before choosing a certification.
• Your business location: If you’re a small, locally owned business, you might get more benefits from a state or local certification. If you have multiple locations across the U.S., a national certification may benefit you more, but you may also want to pursue a local certification in the city where your business is headquartered.
• Your budget: Some programs are free, while others cost hundreds of dollars. Be sure to weigh the cost and the benefits of each program before applying.
• Ease of application process: Some certification processes involve a lot of paperwork and require a site visit. Approval times also vary between 30 and 90 days. You should determine how much time and effort you’re willing to put in to get certified and whether the benefits are worth it.

In some cases, it may be beneficial to apply to multiple certification programs, as long as you can qualify and will receive unique benefits from each program.