Mellody Hobson is co-CEO and president of Ariel Investments who is leading Project Black, a private equity fund that invests in middle-market companies and provides them with capital and contacts. By connecting them with customers and capital, Project Black, which is being executed with JPMorgan Chase CEO Jamie Dimon, aims to get more black CEOs and executives into the upper tiers and C-suites, according to Forbes. The project also seeks to assist minority-owned businesses grow to the extent that they can become suppliers to large corporations like Walmart.
Figures cited by Forbes show that even though black entrepreneurs start more businesses, only five black-owned businesses are among the roughly 500 private companies in the U.S. with more than $1 billion a year in sales.
“When people talk about Black businesses, they talk about access to capital, access to capital, access to capital,” Hobson told Forbes. “Access to customers may be more important.” At the moment, just 2% of corporate spending goes to minority-owned suppliers. To help reverse the trend, Hobson’s Project Black hopes to acquire companies with $100 million to $1 billion in sales and if they don’t have Black and Latino executives, some will be installed. This will encourage firms to acquire smaller enterprises owned by underrepresented minorities and to grow to become competitive, catering to the supply chain needs of large companies, Hobson told Forbes.
In 2022, Project Black made its first investment by acquiring 52.5% of Sorenson Communications from other private equity investors at an enterprise value of $1.3 billion. The company based in Utah now has 13 people of color across its C-suite and boardroom, up from one, following the acquisition. Project Black will in future also look at minoritizing companies in other areas such as technology, health care, and manufacturing.
Hobson’s decision to support black businesses was also influenced by her rise in corporate America. In 2021, she became the first African-American woman to chair the board of a Fortune 500 company, Starbucks. Hobson first started as an intern at Ariel Investments 32 years ago before rising through the ranks to become the co-chief executive officer and the highest shareholder of the investment firm.
After graduating with a Bachelor of Arts in South African studies from Princeton’s Woodrow Wilson School of International Relations and Public Policy in 1991, Hobson was hired as an intern at Ariel Investments. In 2000, less than 10 years after joining the firm, she became the president of the firm after having served in the capacities of senior vice president and director of marketing.
The 54-year-old businesswoman, who serves on the board of many organizations including JPMorgan Chase, made Time’s 2015 100 List, the magazine’s annual list of the one hundred most influential people in the world, and was inducted as a Laureate of the Lincoln Academy of Illinois.
She was also awarded the Order of Lincoln (the State’s highest honor) by the Governor of Illinois in 2018. Born to a single mother who worked as a real estate agent, Hobson’s desire to see more Black executives is also due to her humble beginnings. She once recalled instances where her family would get evicted or have their lights, phones and water disconnected and how they would heat water on stoves for a bath because her mother struggled to make ends meet.
She described those times as “incredibly challenging and uncertain”; times which made her and her family anxious. She recently told Thrive Global in an interview that those tough times have, however, shaped her as an adult and have contributed immensely to her success as a businesswoman.
