In January, President Trump signed an executive order ending federal DEI initiatives. Some large companies, including Walmart and Amazon, have since scaled back their commitment to DEI programs.

Businesses must adhere to U.S. laws, said Smith, who is African American, and one of the most powerful executives in private equity. His firm, Vista, is an investor in nearly 90 portfolio companies that employ over 100,000 people.

“America should be a place of meritocracy, but not just meritocracy in race, but meritocracy in an opportunity set,” he said.

There were 340.1 million people in the U.S. last year, according to the U.S. Census Bureau. Businesses cannot exclude wide swaths of the population, Smith said. White women held 63% of DEI leadership roles, he said. “You’re going to not include them?… No, you are. People are just maybe offended by the way that certain of the programs were administered,” he said.

Many companies will continue to hire the best people, Smith added, and that these hires will often be diverse. Companies will continue to have a wide focus because “people have now been educated and have opportunities and so the best people are very diverse now relative to what it was maybe 40, 50 years ago, when people didn’t have access to education and educational opportunities to enable them to be successful in the workforce,” he said. 

Smith made the comments during a fireside chat Wednesday at the Economic Club of New York. The Vista executive has authored a book, Lead Boldly: Seven Principles from Martin Luther King, Jr., which will be published in August. Lead Boldly features several speeches from Dr. King and includes personal stories and experiences from Smith.

Smith, during the fireside chat Wednesday, said he benefited from Dr. King’s work and is part of the first generation of African Americans “to have all my rights.” African Americans have to adapt to the ever-shifting landscape of values in the U.S., he said. There is a need to make the U.S. economy more inclusive because “we cannot survive if only part of the American engine is prospering,” Smith said. 

Efficiency is good

A former Goldman Sachs investment banker, Smith is one of the most successful African American executives. Last year, he ranked 88^th on the Forbes 400 list of richest people in the U.S. with a net worth of $10.8 billion. Smith was no longer the richest African American in the U.S., losing the title in 2024 to IT entrepreneur David Steward, whose net worth was $11.4 billion, Forbes reported.

Smith is widely expected to turn to politics whenever he leaves Vista, the PE firm he founded in 2000. In 2019, Smith famously paid off the student loan debt for the entire 2019 graduating class of Morehouse College.

Smith said Wednesday that he was excited by attempts from the Department of Government Efficiency, or DOGE, to make the U.S. government more efficient. DOGE is being led by the world’s richest man, Elon Musk, who is using what some regard as brutal methods to shrink the federal workforce.The online tracker for DOGE claimed Wednesday that the “agency” had saved an estimated $65 billion, Fortune reported.

“I’m in support of us figuring out how to make the government more efficient,” Smith said.

Musk has recruited several Silicon Valley execs to help with DOGE including Marc Andreessen, cofounder and general partner of Andreessen Horowitz and Shaun Maguire, a partner of Sequoia Capital. DOGE has installed some execs at government agencies to help enforce its cost-cutting measure. For example, Tom Krause, CEO of Cloud Software Group, is fiscal assistant secretary at the Treasury Department, The New York Times reported.

Cloud Software is a Vista portfolio company. (Vista acquired Citrix Systems in 2022 for $16.5 billion and combined it with Tibco Software to form Cloud Software.) Krause is “on leave for a little bit,” Smith said. A person familiar with the situation later clarified that Krause remains CEO of Cloud Software while he works at DOGE and is doing both jobs simultaneously.

The Vista CEO said if he had to pick one person to evaluate waste in a large scale infrastructure, Krause would be that person. The Cloud Software chief executive is “one of the most efficient people that I’ve ever seen in my 25 years of running Vista and 35 years in this industry,” Smith said.

“Krause will deliver the truth of what things are in that department,” Smith added.