Monthly Archives: October 2014

The HBCU Money™ Weekly Market Watch

Our Money Matters /\ October 24, 2014

A weekly snapshot of African American owned public companies and HBCU Money™ tracked African stock exchanges.


African American Publicly Traded Companies

Citizens Bancshares Georgia (CZBS) $8.45 (2.87% DN)

M&F Bancorp (MFBP) $4.96 (0.00% DN)

Radio One (ROIA) $2.61 (0.00% UNCH)

African Stock Exchanges

Bourse Regionale des Valeurs Mobilieres (BRVM)  241.43 (0.29% UP)

Botswana Stock Exchange (BSE)  9 570.74 (0.05% DN)

Ghana Stock Exchange (GSE)  2 226.37 (3.78% UP)*

Nairobi Stock Exchange (NSE)  159.22 (N/A)

Johannesburg Stock Exchange (JSE) 47 879.45 (0.47% DN)

International Stock Exchanges

New York Stock Exchange (NYSE) 10 582.62 (1.39% UP)

London Stock Exchange (LSE)  3 418.09 (0.43% DN)

Tokyo Stock Exchange (TOPIX)  1 242.32 (0.81% UP)


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Who Is The Wealthiest HBCU Graduate? Hint: It Is Not Oprah Winfrey

By William A. Foster, IV

“The only thing that should surprise us is that there are still some things that can surprise us.” – Francois de La Rochefoucald


Pictured Above: Ann Walton Kroenke, Lincoln University (MO) – Class of 1972

In a recent article for HBCU Money, I was researching the educational demographics for America’s 100 wealthiest. Naturally, as I was looking through their profiles I was seeing the names of your typical Harvard, Yale, etc. as colleges attended. Knowing that Oprah Winfrey, who is not among America’s 100 wealthiest, has long been the only African American billionaire and was an alum of Tennessee State University it seemed fairly certain she was then the wealthiest HBCU graduate. You know A + B = C type stuff. Well, you know what happens when you assume. I stumbled across the profile of one Ann Walton Kroenke and saw the name Lincoln University, but the profile did not specify which Lincoln University. If it turned to be true, then Ann Walton Kroenke would actually be the wealthiest HBCU alum. Mrs. Kroenke’s $5.1 billion net worth according to Forbes makes her 76 percent wealthier than Oprah Winfrey.

Wait, what? Can that be right? Is there another Lincoln University other than the two HBCU Lincoln Universities? Turns out there is one in California so the investigation was on to verify exactly which Lincoln University she attended. After some digging and further research the answer would indeed be she attended and finished from the HBCU known as Lincoln University of Missouri. According to Lincoln University (MO) school records, “Ann Marie Walton received an Associate of Applied Science majoring in Nursing Science on May 14, 1972. She attended Lincoln University from August 1970 to May 1972.” Yes, the Walton name you see is actually her maiden name; and yes it is those Waltons to which she is related and derived most of her wealth from. She is the daughter of James “Bud” Walton who co-founded the Walmart empire with his brother and more well-known Sam Walton. James and Sam Walton spent their formative years being raised in Missouri by their parents. According to the Historical Society of Missouri, the majority of Walmart’s initial store openings would happen in Missouri and Arkansas. The pair originally got started owning Ben Franklin variety stores after Sam Walton obtained a $20 000 loan from his father-in-law in 1945. An amount that would be equivalent to $260 000 in today’s dollars. Walmart would come into being after the two brothers decided to expand into rural communities in the early 1960s. Although the company is well known as having its headquarters in Arkansas; the family’s roots have been firmly planted in Columbia, Missouri since the 1930s.

A fascinating prospect if ever there was one given Missouri’s own paradoxical racial history despite not being considered “south” geographically, but having much of the cultural nuances of it. Mrs. Kroenke, would have been a fresh 21 year old at the time of her arrival in the fall of 1970. The Nursing Science program itself would be just a year old at Lincoln having been launched in 1969. America’s backdrop in 1970 would be fresh off the heels of Malcolm X’s assassination in 1965, Martin Luther King Jr.’s assassination in 1968, the signing of the Civil Rights Act in 1968 by President Lyndon Johnson, and the Black Panther Party in 1970 would see the apex of its membership and power. Walmart as an incorporated company is not even a year old, when the then Ms. Walton would be entering Lincoln University’s (MO) program. America’s wealthiest family to be was by no means poor, but her father and uncle were also leveraging all of the family’s resources to strike out on their own and build their company. The possibility that Mrs. Kroenke at the time needed a fallback could have certainly been plausible, but why Lincoln University (MO)? Given the backdrop of race relationships, civil rights, and her family’s resources it is inherently fascinating how the family and/or she decided to send her 40 minutes down the road to Jefferson City, Missouri to attend an HBCU.

The discovery of Mrs. Kroenke as a Lincoln University (MO) alumni is no small happenstance. Not only is she worth $5.1 billion herself, but she is married to one Stanley Kroenke who is billionaire real estate developer himself worth $5.6 billion. The couple owns professional sports teams in every professional sport, except baseball. Their roster includes the NBA’s Denver Nuggets, NHL’s Colorado Avalanche, NFL’s St. Louis Rams, MLS’s Colorado Rapids, and English soccer club Arsenal. A $50 million donation from Mrs. Kroenke for the endowment would instantly catapult Lincoln University (MO) to the number six slot in terms of HBCU endowments. It would also become the largest gift ever to an HBCU and it would not even be 1 percent of her wealth and less than 0.5 percent of the couples combined wealth. Yes, you read that correctly.

It would be interesting to see how the HBCU community would receive the donation quite honestly. There would be more than a bit of mixed feelings certainly. Given the new push for cultural and ethnic “diversity” (despite European Americans always being welcomed at HBCUs since their inception while vice versa was not true) at HBCUs as presidents have seemingly given up on how to increase the HBCU share of African American high school graduates going to HBCUs which currently sits at 10-12 percent, and instead focused on recruiting all other groups as a way to deal with tuition revenue shortfalls from dropping student populations and to sell themselves as more “American”. This despite many older HBCU alumni believing that these students are even less likely to give back to an HBCU than the traditional core demographic. There is no data to say one way or the other. Unfortunately, this is not something HBCUs can afford to be wrong on given the amount of resources they seem to be throwing at recruiting other communities. If the payoff is only a short-term fix for a long-term problem, then we are simply continuing to put a band-aid on a bullet wound. There is also the psychological impact of the largest donation (albeit from an alumni) still coming from someone that is European American much in the way when the valedictorian of Morehouse some years ago was European American and the fallout it caused. A wound, that in talking to some Morehouse alums still runs deep. However, Lincoln University (MO) seems to lack any endowment of note or at least has refused to publish the number anywhere in my research for it.

The old adage that beggars can not be choosy may apply here as HBCUs have continued to lack in obtaining transformative donations, those that are of the eight and nine figure variety, and in general struggle with consistency in alumni giving rates as a whole. America’s wealthiest family at the writing of this article was worth north of $150 billion combined by the three surviving children of Sam Walton, the widow of Sam Walton’s fourth child, and the two daughters of James “Bud” Walton, one of which is Mrs. Ann Walton Kroenke. The family also has a bittersweet HBCU connection when in 2012 the Tennessee Supreme Court allowed Alice Walton, the only daughter of Sam Walton and founder of Crystal Bridges Museum in Arkansas, to purchase a 50 percent stake in Fisk University’s George O’Keeffe art collection for $30 million as Fisk dealt with financial issues. It goes without saying that the Walton family clearly knows about HBCUs, but whether or not HBCUs and more specifically Lincoln University (MO) can leverage that into something transformative is another story. I would go so far as to say I would set up an office in Columbia, Missouri if I was LUM’s administration and dedicate development staff solely to the purpose of achieving that donation.

Honestly, finding out Oprah Winfrey is not the wealthiest HBCU graduate almost feels like the moment as a child you figure out Santa is not really real. To find out there are two HBCU graduates who are billionaires is always good news. That one of those billionaires is a member of the Walton family is almost too hard to wrap my own mind around at the moment, but as my favorite HBCUstorian Dr. Crystal DeGregory famously says, “HISTORY is the story of great men; HERSTORY of great women. HBCUstory is the story of HBCU greatness. That’s our story!” And I have to say our story never ceases to amaze me.

Does Graduate School Matter? America’s 100 Wealthiest: 44 Percent Have Graduate Degrees

By William A. Foster, IV

Our most widely known scholars have been trained in universities outside of the South. – Dr. Carter G. Woodson


Probability is defined as how likely something is to happen. Most events can not be predicted with absolute certainty. The best we can do is to say how likely something is to happen using the theory of probability. We all know that education is important, but how much education is needed has always been up for debate. Let us be clear, all education is not created equal. Howard University  and the University of Phoenix are in different pantheons of education despite both offering undergraduate and graduate degrees. A large portion of college, be it undergraduate or graduate is about the network you are plugging into and the proverbial “ownership” that institution serves. For instance, Notre Dame clearly is “owned” by the Catholic community. Its social, economic, and political DNA all flows through its Catholic roots and papal connection from its founding and is rooted in all that it does today. It goes without saying that a Catholic at Notre Dame will be afforded a higher probability of certain opportunities and access to its network’s power, something that non-Catholics attending Notre Dame would not be afforded. This institutional ownership can be based on religion, ancestry, gender, etc. All of these things must be factored in and complicit when analyzing, but that does not change the overarching reality that just an undergraduate degree is enough information intake anymore to break through into the pantheons of America’s wealthiest.

Out of the 100 wealthiest Americans 44 percent have graduate degrees. The normal assumption is of course they all have MBAs, which is well represented certainly, but by no means was the MBA the dominant degree that even I assumed it would be. Overall, 74 percent of the wealthiest 100 have at least a bachelor’s degree, 13 percent attended some college and dropped out, and the rest some mixture of high school or unknown education. You could argue that the country does not just say education matters, it practices it and rewards it. The Bureau of Labor Statistics shows that over a 35 year span those with master’s, doctoral, and professional degrees will earn $100 000, $215 000, and $240 000 more than those with just a bachelors, respectively. That is not even taking into account the potential of those additional earnings being transformed into investments, which is often the catalyst for becoming among America’s wealthiest. Unless you are coming into a family inheritance, then you will need all the extra capital you can get to increase your probability of economic success. Again, all education is not created equal and whom you are being educated by matters, but to see that education is prevalent among the country’s economic elite does speak volumes to community values. The breakdown of the graduate degrees was also surprising. Yes, MBAs led the way, but as aforementioned the gap was not as large as I assumed it would be. MBAs constituted 43 percent of graduate degrees, MA/MS were next with 32 percent, law degrees or JDs were third with almost 23 percent, and PhD/MDs comprised almost 16 percent. With this type of information it further reinforces HBCUs need to build their graduate school ecosystem and network from within.

HBCUs best and brightest undergraduates continue to be cherry picked by HWCU/PWIs in an institutional brain drain of the HBCU ecosystem. This impact allows for a justification of a disproportionate amount of research funding to be steered away from HBCUs. We also know that graduate schools are responsible for the likes of creating companies such as FedEx and Google. A report by the Kauffman Foundation on MIT’s alumni founded companies alone shows the school’s alumni have created economic impact equivalent to the eleventh largest country on Earth and employs almost 2 million people. If HBCUs were to even match half of that employment number it would drop African America’s unemployment rate to under 6 percent and create jobs for every HBCU graduate. At current, the gap between HWCU and HBCU research spending is startling to say the least with the top 20 HWCU research institutions spending $40 to every $1 in research that the top 20 HBCU research institutions spend. As noted in our article on public HBCU athletics, HBCUs are spending $0.80 on athletics for every $1.00 of research, while our counterparts are spending $0.14 on athletics for every $1.00 of research. If graduate schools matter and research matters in the climb up the economic ladder in America (and arguably around the world), then HBCUs and their alumni have to stop treating their graduate schools like places for their undergraduate alumni to holdover while they figure out life or wait to get a job offer after graduation.

There are 43 HBCU (including Chicago State University and Charles Drew University) with graduate programs, five HBCU law schools, and four HBCU medical schools. Currently, the only full service HBCU, those with graduate programs, law school, and medical school, is Howard University. No public HBCUs have a medical school which means HBCUs are missing out on public funds directed toward medical research. Again, research is typically the forerunner to products being developed and companies being founded. Having access to public funds is often vital to that development. Another way to look at it is that African Americans are paying into the tax base for medical research, but not able to extract any of it through our public institutions. It is not only STEM though that we must be concerned with. The social sciences and humanities are areas where there is a vital opportunity to present to the world an African Diaspora point of view through research. Yet, when it comes to something as simple as African Studies we are anorexic in our presence in the field. The Root a few  years ago pointed out, “only Howard and Clark Atlanta universities offer master’s programs. Howard is also the only HBCU to offer a doctoral program in African studies, which is offered by eight traditionally white institutions.” How will African American businesses be able to do business in Africa if we do not have a cultural understanding of the diversity within our own Diaspora? One would imagine that someone with graduate level studies could form a consulting company that sells services that help businesses transition products and services for optimal success on the continent. The continent by the way with the fastest growing economies in the world.

The MBA on the other hand is an animal upon itself. One in which of late a number of HBCUs have decided to offer. The MBA long served as a tool of training tomorrow’s CEO’s and upper level management. It usually required a minimum of five years working experience, the GMAT, and sacrificing your social life for two years due to the intensity and demand of the nation’s best programs. I once had a classmate try to work 15 hours per week as a waiter while we were in business school and it almost killed him. Truly great MBA programs will tell you that between good grades, social life, and sleep you are only going to achieve two during your two years. It is one of those degrees, as noted by the percentage aforementioned, that if you are going to offer you better offer it right. Unfortunately, most HBCUs are offering an MBA program that is barely a notch above the University of Phoenix’s MBA program. It is questionable whether it is worth the paper it is printed on and does little more than add tuition revenue to the school’s coffers and debt to the student’s bottom line. They are usually not unique in any kind of way other than accessibility which is really not the point of an MBA. I moved to Boston to do part of mine in a program that required a semester abroad at usually the visiting country’s top MBA program. A traditional MBA that is going to have brand recognition is not going to be part-time. To get the benefits there is sacrifice required not convenience. I say that to say HBCUs that are offering MBAs just to offer them will never be able to recruit the top talented HBCU undergraduates or professionals because they are just one in a pile. Instead, what many should have been doing is offering specialized MBAs in fields like agriculture, computer science, government, philanthropy, or even an MBA for education professionals like Rice University does. Even more like Brandeis University that offers an MBA in Jewish Studies. Why are there no HBCU MBAs that teach HBCU graduates how to run and manage African American owned organizations and businesses? We face unique challenges in starting and building organizations and businesses and yet, HBCUs largely ignore this as an opportunity.

It is clear that in this, the information age, that knowledge matters. Knowledge always has been to some degree, but even more so now – power. Quality knowledge across a great spectrum is vital to developing tomorrow for our communities, institutions, and families. We teach students in undergraduate the basics of that knowledge, but it is in graduate school where they learn the nuances, develop, and hone the skills of putting that knowledge to use. Is graduate a guarantee to riches? Certainly not. Nothing in life ever is. However, what we do see is that if we plan to close the wealth gap both individually and institutionally; it will be done through harnessing more knowledge not less. As the requirements for high skilled jobs and entrepreneurship skyrocket, then we are increasingly getting further and further behind the curve by not innovating within our own graduate schools and ecosystem. Often doing more reactive and symbolic gestures than substantive ones. Of the 1.8 million full-time students enrolled in graduate programs in the United States, 12.1 percent are African American according to the Council on Graduate Schools. Nationally, graduate students comprise 14.3 percent of the combined undergraduate and graduate school population. Conversely, African American graduate students comprise only 6.9 percent of the combined African American undergraduate and graduate school population. Most likely due to many African American undergraduates choosing to go straight to work immediately upon graduation, unable to forgo an additional number of years of earnings despite the aforementioned long-term economic benefits.

America’s wealthiest come from a myriad of different industries. They have all made their wealth in a vast spectrum of different ways. The constant to their stories is graduate level education tilts the odds in their favor to achieve economic independence and wealth for  almost 1 out of 2. In other words, like the motto of the HBCU Endowment Foundation, an organization with a strong emphasis on HBCU graduate school development, – “Sacrifice today, so tomorrow may prosper.”

Editor’s Correction: There are five HBCU medical schools. Tuskegee University has a veterinarian school, which is recognized as a medical school.

HBCU Money™ Business Book Feature – Disciplined Entrepreneurship: 24 Steps to a Successful Startup


24 Steps to Success!

Disciplined Entrepreneurship will change the way you think about starting a company. Many believe that entrepreneurship cannot be taught, but great entrepreneurs aren’t born with something special – they simply make great products. This book will show you how to create a successful startup through developing an innovative product. It breaks down the necessary processes into an integrated, comprehensive, and proven 24-step framework that any industrious person can learn and apply.

You will learn:

  • Why the “F” word – focus – is crucial to a startup’s success
  • Common obstacles that entrepreneurs face – and how to overcome them
  • How to use innovation to stand out in the crowd – it’s not just about technology

Whether you’re a first-time or repeat entrepreneur, Disciplined Entrepreneurship gives you the tools you need to improve your odds of making a product people want.

Author Bill Aulet is the managing director of the Martin Trust Center for MIT Entrepreneurship as well as a senior lecturer at the MIT Sloan School of Management.

HBCU Money™ Dozen 10/13 – 10/17


Did you miss HBCU Money™ Dozen via Twitter? No worry. We are now putting them on the site for you to visit at your leisure. We have made some changes here at HBCU Money™ Dozen. We are now solely focused on research and central bank articles from the previous week.


Unsubsidized Batteries May Reduce Need For Grid Infrastructure l Clean Technica

Welcome to the crazy world of first-person drone racing l New Scientist

India’s Largest Power Producer To Invest $810 Million In 750 MW Solar PV Project l Clean Technica

Is There a Point Where a Private Cloud is Cheaper Than the Public Cloud? l CIOonline

Startup builds on Wi-Fi chips for cheaper ‘last mile’ to home broadband l Computerworld

Algorithms: Technology is poised to make big changes in the delivery of healthcare l CIOonline

Federal Reserve, Central Banks, & Financial Departments

Diesel: Average price per gallon falls to $3.698, the lowest in more than two years l St. Louis Fed

The euro – taking off or staying grounded? l Bank of Int’l Settlements

50% of the world’s population is 25 years or younger. They can help governments be better: l World Bank

By 2030, we’ll need to produce 50% more food. l World Economic Forum

Euro area investment fund statistics l European Central Bank

Who is the world’s largest investor in #cleanenergy? l World Economic Forum

Thank you as always for joining us on Saturday for HBCU Money™ Dozen. The 12 most important research and finance articles of the week.