Investing In HBCUs And The Next Generation Of Black Leaders
Billionaire Robert F. Smith made headlines during a commencement speech when he vowed to wipe out the student debt of the entire 2019 graduating class of Morehouse College.
Billionaire Robert F. Smith made headlines during a commencement speech when he vowed to wipe out the student debt of the entire 2019 graduating class of Morehouse College. His $34 million donation paid off the debt of about 400 Morehouse graduates, including the educational debt incurred by their families. Smith is the founder, Chairman and CEO of Vista Equity Partners, a private equity firm with $96 billion in assets that focuses on investing in software companies. He is also the wealthiest Black man in America with a net worth of $8 billion, according to Forbes data as of January 2023.
Smith followed up his magnanimous offer by launching the Student Freedom Initiative, a nonprofit organization, to ease the disproportionate burden of student loan debt on Black students at historically Black colleges and universities (HBCUs). The initiative is currently operating with a $50 million grant from the Ford II Foundation, a charitable organization of which Smith is Founding Director and President, a $50 million donation from Smith himself and generous contributions from many others. The overall objective is to liberate students so that they have better career options and can make better career choices.
Unfair levels of student debt have Black students playing catch-up from the day they start their careers. “It is one of the downsides of the cost of higher education,” says Dr. Nadrea Njoku, Director of the Frederick D. Patterson Research Institute at the United Negro College Fund (UNCF). “So, if you make $500,000 as a neurosurgeon, that could be disrupted if you also owe $500,000 in student loans,” she explains. UNCF awards more than 7,000 scholarships worth about $83 million annually
and has raised more than $5 billion since its 1944 inception. UNCF recently received $190 million from Fidelity Investments, its largest corporate gift to date.
HBCUs have been at the center of the American story for over 180 years—socially and economically.
HBCUs have been at the center of the American story for over 180 years—socially and economically. Today, there are 101 accredited HBCUs, which represent only 3% of higher education institutions in the country. HBCU alumni continue to punch above their weight, notes Njoku, referring to research that reveals HBCUs serve more economically disenfranchised students than most U.S. institutions but also are better vehicles for social mobility and fuel the Black middle class.
“A key component when we think about how we build the next generation of leaders and support the career development of Black talent is HBCUs,” says Byna Elliott, Global Head of Advancing Black Pathways at JPMorgan Chase. She points to the financial services firm’s 5-year, $30 million commitment to the financial and career success of students at HBCUs.
Elliott says the firm’s relationship with HBCUs is a vital step toward breaking down barriers and creating more access to economic opportunity. “This commitment offers HBCUs the flexibility they need to meet the unique needs of their students and provide the next generation access to tools and resources to get ahead.”