I also changed my theme to wordpress tweenty fourteen theme and the problem still occurs.

I also tried this code you provided and I got the same result which is the filter keeps changing back to (all members) when I click on the status update form(what’s new form)

/**
 * Set default activity directory tab for BuddyPress
 */
function buddydev_set_default_activity_directory_tab() {
    // If user is not logged in or
    // If the scope is already set, do not do anything ok.
    if ( ! is_user_logged_in() || isset( $_COOKIE['bp-activity-scope'] ) ) {
        return ;
    }
    // additional check for activity dir
    if ( ! bp_is_activity_directory() ) {
        return ;
    }
    $tab = 'following'; // 'all', 'friends', 'groups', 'mentions'
    // Set scope to our needed tab,
    // In this case, I am setting to the 'friends' tab
    setcookie( 'bp-activity-scope', $tab,null, '/' );
    $_COOKIE['bp-activity-scope'] = $tab;
}
add_action( 'bp_template_redirect', 'buddydev_set_default_activity_directory_tab' );

Ok this will work, all I have to do is create a new custom user role and automatically assign the role with the necessary member types. So when a new user registers as either a brand or business his role will automatically be registered as the custom role. You can paste the code.

Thank you very much for your help I really appreciate your effort.

This worked perfectly.

After applying the code I just came to the realization that the problem is solved half way because the button does not show up but the friend tab in the navigation bar still shows. I should have realized this from the begining.

So what do you think about disableing the actual buddypress friendship component for one or more specific member types.

Also thank you for tremendous support!!!

Thank very very much you are a life saver.

It worked perfectly, I am indebted to you, you are God sent.

I would really appreciate it if you can share this code to others on your blog. There might be other people having similar problems.