How Stephen Miller brought the ‘war on woke’ to small businesses

No startup founder likes to learn they’re being sued. But when Elizabeth Gore received an email this past summer letting her know that her company was being targeted, it was who was suing her that really made her blanch: Stephen Miller.



Miller made his name as the aide to former president Donald Trump who devised the administration’s restriction on Muslim visitors to the U.S. in 2017 and later championed the separation of migrant families at the border. After leaving the White House, Miller launched a litigation factory called America First Legal (AFL), which has been waging a campaign against progressive policies in the Biden administration and, increasingly, corporations.



Now Miller’s group was suing Hello Alice, the online platform for entrepreneurs that Gore had cofounded. AFL was taking legal action against the Houston-based company over a program that offered $25,000 grants to Black-owned businesses, which AFL characterized as racial discrimination. (AFL also sued Progressive Insurance, Hello Alice’s partner on the program; Progressive declined to comment for this story.)



Gore quickly conferred with Hello Alice cofounder and CEO Carolyn Rodz. “I’ll admit, I was scared to death,” Gore says. But that fear turned to resolve. Miller appeared to be using Hello Alice as a way to force other organizations to shy away from taking race into consideration when putting money toward grants, corporate philanthropy, and other diversity programs. The lawsuit, which a district court could rule on as early as this summer and which might make its way to the Supreme Court, could prevent American companies and nonprofits from trying to use their enormous resources to open the business landscape to people of color and women.



“It’s part of an intentional, well-organized attempt to restore barriers to the American dream,” says Stacey Abrams, the former Democratic leader of the Georgia House of Representatives and 2022 gubernatorial candidate, of AFL’s suit. There are three main avenues to progress for Americans, she contends: voting, getting an education, and starting or working for a small business. All of them, she says, have been under attack. “That should terrify everyone.”



The lawsuit is part of a larger battle against diversity being waged in corporate America by a host of right-wing organizations and individuals, from the lawmakers pushing anti-ESG (environmental, social, and governance) legislation in statehouses across the country to Edward Blum, the legal mastermind behind the case that led to the Supreme Court’s 2023 decision banning affirmative action in college admissions. In the past seven months, AFL has filed federal civil rights complaints against Disney for its efforts to diversify its writers rooms and production teams; Nike, for emphasizing representation in hiring and training; and the NFL, for adopting the Rooney Rule to consider candidates from underrepresented groups for management positions. Miller’s group has also lodged lawsuits against Meta, Amazon, and CBS for diversity-focused practices. Some companies that have come under attack have quietly dismantled the offending programs; others have settled. Most have the resources to fight.



Hello Alice doesn’t have such deep pockets. But if Miller saw Hello Alice as an easy mark, he might have been mistaken.







in 2013, Rodz and Gore found themselves chatting in a tent in the wilds of northern Utah, attendees at a conference at which guests reportedly paid up to $12,000 to do yoga, fish, and kibitz with fellow entrepreneurs, would-be investors, and the author and psychotherapist Esther Perel.



There was, Rodz recalls thinking, something odd about the whole thing. She was there to explore what was next after selling her second company, a digital marketing firm. Gore was the vice president of the United Nations Foundation. Here they were, getting access to career-making connections and ideas, only after they needed them.



“What about all the people,” Rodz recalls thinking, “that can’t afford this?” They mulled over an idea: What if they built a data-driven online platform that matched female founders with everything from mentors and tech tools to credit and grants?



[Illustration: Chad Hagen ]



That platform became Hello Alice, which today supports more than a million and a half small businesses. Since its launch in 2017, it’s deployed about $40 million in grants, attracted investors like Serena Williams and Jean Case, and grown to 40 employees. (The platform is free for small businesses to use, and it makes its money offering software that allows financial institutions to engage with the small-business community.) The site has also widened its scope to serve a larger community of entrepreneurs, including LGBTQ+ people, those with disabilities, veterans, military spouses, and especially people of color. “We call our audience the New Majority of small-business owners,” Gore says.



According to the U.S. Small Business Administration, Black Americans make up some 13% of the U.S. population but lead only 2% of businesses with more than one employee. Notably, while 20% of Black Americans start businesses, McKinsey & Company has found that the vast majority fail in the first year and a half, and just 4% get past the startup stage.



One big challenge is money. Black Americans often find it difficult to obtain loans and self-fund their small businesses at a higher rate. The economic impact of this is profound: McKinsey found that if Black Americans ran small businesses proportionate to their share of the population, it would add some $1.6 trillion to the country’s economy. By offering its services—and small-business grants—to underserved entrepreneurs, Hello Alice hopes to move this needle. “We believe in equitable access to capital,” says Rodz.







Miller isn’t an attorney—he graduated from Duke with a bachelor’s degree in political science—but he sometimes plays one on TV. In a recent ad for AFL, he appears in front of a bookcase with a small statue of the Lincoln Memorial as anxious string music plays, looking like a stereotypical late-night, 1-800 lawyer. “If you or a loved one were denied a job, raise, promotion, or professional opportunity as a result of diversity programs, equity mandates, affirmative action, or other racial preferences, we want to hear from you,” he says, before leaning into the camera and declaring, “Racism must be defeated.”



Miller seems to believe that white American men have been getting the short end of the stick for far too long. AFL is his conservative spin on the century-old American Civil Liberties Union, dedicated explicitly to opposing “the radical left’s anti-jobs, anti-freedom, anti-faith, anti-borders, anti-police, and anti-American crusade.”



Its prime targets are the diversity, equity, and inclusion programs that gained steam following George Floyd’s murder in 2020 and aim to institute hiring practices and other programs to give a fuller range of Americans economic opportunity.



“We are filing critical lawsuits to dismantle the DEI industrial complex,” AFL posted in March on X, where Miller’s bio includes the hashtag DemolishDEI. To that end, AFL has filed scores of lawsuits against major corporations.



Organized as a nonprofit, AFL promises would-be clients free representation. It’s an offer it can afford to make. The group has brought in tens of millions of dollars in donations; its most recent filings, from 2022, show revenue of more than $44 million. While critics have squawked about AFL being little more than a fundraising play, it has had some early wins. Just months after it launched, AFL successfully pushed the federal Small Business Administration to abandon a post-COVID program aimed at supporting restaurant owners. Miller’s group argued that the program’s effort to prioritize female and minority owners violated the U.S. Constitution.



Last June, just as the Supreme Court issued its landmark ruling about college admissions, Hello Alice was working to help 10 Black-owned businesses. Through a partnership with Progressive, Hello Alice offered each one $25,000 toward the purchase of a commercial vehicle. “It’s capital-intensive at first,” Gore says. “You have to buy the vehicles. It’s hard to get that first loan.”



Nathan Roberts, owner of Ohio-based Freedom Truck Dispatch, wanted one of those grants, and Roberts is white. AFL filed a class-action lawsuit against Hello Alice and Progressive on his behalf.



In the complaint, AFL argues that the grant program violated a provision of the Civil Rights Act of 1866 that prohibits racial discrimination in the making and enforcing of contracts. The suit skips over the fact that the law wasn’t intended to protect white Americans, and it lumps grants in with contracts, arguing that Hello Alice was entering into a contractual agreement with grantees by requiring them to detail a path for growth. Despite this provocative legal founding, AFL added considerable firepower to the suit by pulling in as co-counsel Jonathan Mitchell, a former solicitor general of Texas, who led that state’s abortion ban.



Hello Alice has enlisted its own heavyweight: Neal Katyal, a former acting solicitor general of the United States, who has represented major corporations in diversity suits. “I have no problem with Stephen Miller going to companies and saying, ‘Hey, you shouldn’t have these programs. Here’s why they’re bad,’ ” Katyal says. But “he’s trying to use the courts to do what he couldn’t get done through his powers of persuasion.”



Katyal is laying out a defense that could be hugely consequential should it set legal precedent. While arguing that the funds at issue were a grant, not a contract, Hello Alice and Katyal contend that restricting a company’s ability to use its resources to tackle long-standing inequities would violate the First Amendment. Civil rights groups, meanwhile, have argued in an amicus brief that AFL is using a law meant to end racial discrimination to perpetuate it. The suit, they say, is a “perversity.”



given the skepticism the Supreme Court and lower courts have shown toward considerations of race, “conservatives are doing exactly what you’d expect,” says George Rutherglen, a professor of law at the University of Virginia. To critics, they’re issuing a barrage of legal actions that, under the guise of being “colorblind,” could turn back the clock on efforts to diversify America’s business landscape.



“It is my hope, and the hope of a significant majority of all Americans, that we restore the colorblind legal covenant that binds together our multiracial, multiethnic nation,” says Blum, who sued the Atlanta- based nonprofit Fearless Fund over grants to Black female entrepreneurs, in a case that’s similar to AFL’s. In October, a federal court in Georgia temporarily ruled in favor of Blum.



Stacey Abrams points out that DEI critics have “cherry-picked” the courts most likely to side with them. The Hello Alice case, for example, is being heard by a district court that falls under the jurisdiction of the Sixth Circuit Court of Appeals, which has a reputation as conservative.



These suits have destabilized the larger business world. “Fortune 500 companies, law firms, consulting firms, nonprofits—people are very, very concerned,” says David Glasgow, the executive director of New York University’s Meltzer Center for Diversity, Inclusion, and Belonging. “[They’re] nervous about what they can and can’t do.”



Glasgow counsels firms to tweak their DEI programs so that they focus less on targeting specific populations and more on roping in anyone supportive of diversity goals. But there are pitfalls either way: “Trying to mitigate your risk of getting sued on reverse-discrimination claims by abandoning or watering down all your DEI programs—you’re just going to get sued on traditional discrimination claims.”



Of course, while navigating this high-stakes lawsuit, Rodz and Gore have to run a business. Hello Alice had a round of layoffs in December, yet the company recently wrapped up a Series C funding round that values it at $130 million. And Gore has been making the rounds in Washington, warning of the dangers if the case doesn’t go their way. “Hello Alice is extraordinary,” says Abrams. “They are saying, ‘We are not going to let you silence us by threatening us.’ ”



Gore’s message is simple: Hello Alice might be small, but this case is anything but. And how it shakes out may well shape Main Street for generations to come.