Billionaire Robert Smith made headlines last year when he paid off the student debts of Morehouse’s graduating class. Smith, the Chairman and CEO of Vista Equity Partners, followed it with the launch of a nonprofit, the Student Freedom Initiative (SFI) to help ease the debt burden of thousands of students attending Historically Black Colleges and Universities (HBCUs).
The initiative is supported by a $50 million grant from Fund II Foundation, Smith’s charitable organization, and in June it said it intends to raise at least $500 million by October. On Thursday, the SFI announced that it had received a $50 million personal gift from Smith, matching the initial funding of $50 million provided by the Fund II Foundation.
“Each year, thousands of black graduates from HBCUs across America enter the workforce with a crushing debt burden that stunts future decisions and prevents opportunities and choices,” said the richest Black American.
“…The $1.6 trillion student debt crisis in our country is a human rights crisis. The Initiative is purposefully built to redress historic economic and social inequities and to offer a sustainable, scalable platform to invest in the education of future Black leaders,” Smith, who is also the Board Chair of the SFI, said.
Records show that HBCU students do borrow loans at higher rates than students at other types of institutions. Also, on average, Black college students graduate from bachelor’s degree programs owing $7,400 more than their white peers.
The SFI said in June it will launch at up to 11 HBCUs in the fall of 2021 offering students in STEM majors an alternative to high-interest, fixed-payment private student loans and Parent PLUS loans, according to Inside Higher Ed.
“You think about these students graduating and then plowing so much of their wealth opportunity into supporting this student debt, that’s a travesty in and of itself,” Smith said at the time.
The philanthropist and businessman these past few weeks have made headlines for not the reasons many expected. Smith last week ended a four-year criminal tax probe after reaching a $140 million settlement with the Justice Department. Many believe his recent philanthropic gesture is his push to repair a damaged reputation.
In spite of everything, Smith’s Vista Equity Partners, a private equity company he founded in 2000, has carved a niche for itself, fixing up enterprise software outfits and today has a value of about $46 billion in assets.
The businessman with a bias for educational and entrepreneurship development is among a growing number of high-net-worth black personalities who are using their wealth to improve society. Forbes ranked him number three on its 2019 billionaires list.