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Virginia Union University’s Keller Williams Partnership Exposes HBCU’s Fundamental Misunderstanding of Wealth Building

Posted on January 23, 2026 by hbcumoney | Leave a comment

“It is disappointing that HBCUs and any African American institution for that matter have not figured out yet that the circulation of our social, economic, and political capital with each other at the institutional level is where the acute crisis of closing the wealth gap truly lies. Yet, we still chase colder ice.” – William A. Foster, IV

The percentage of PWI dollars that flow into African American owned businesses is likely limited to catering a social event. Beyond that, their dollar never even likely floats pass an African American business. However, HBCUs certainly cannot say the same. HBCU capital leaving the African American financial ecosystem looks like every dam on Earth broke at the same time.

Virginia Union University’s recent announcement of a partnership with Keller Williams Richmond West represents a familiar pattern in HBCU decision-making, one that undermines the very mission these institutions claim to champion. While VUU proudly touts this collaboration as “groundbreaking” and positions it as a pathway to “closing the racial wealth gap,” the partnership reveals a fundamental misunderstanding of how wealth gaps are actually closed. The reality is stark: you cannot close a racial wealth gap by systematically excluding institutions from your own community from the economic opportunities your institution creates.

When HBCUs partner exclusively with non-Black institutions, they create what economists call a “leaky bucket” effect. The money, talent, and social capital generated by these historically Black institutions flow outward to other communities rather than circulating within the African American ecosystem. Every dollar spent with a non-Black vendor, every partnership signed with a non-Black firm, every opportunity directed away from Black-owned businesses represents wealth that could have been building generational prosperity in Black communities—but instead enriches other groups. This is where the fundamental disconnect lies: HBCUs understand the importance of encouraging individual African Americans to support Black-owned businesses, yet these same institutions fail to apply this principle at the institutional level where the real economic power resides.

The conversation about the circulation of the African American dollar has historically focused on individual consumer behavior. We’ve heard for decades about the need for Black consumers to shop at Black-owned stores, bank with Black-owned financial institutions, and hire Black-owned service providers. Studies have shown that a dollar circulates in Asian communities for approximately thirty days, in Jewish communities for around twenty days, in white communities for seventeen days, but in Black communities for only six hours before leaving. This abysmal circulation rate is correctly identified as a critical factor in the persistent wealth gap. But what these discussions almost always miss is that individual consumer behavior, while important, pales in comparison to institutional spending power.

When Virginia Union University signs a multiyear partnership with Keller Williams, it’s not spending a few hundred or even a few thousand dollars. Institutional partnerships involve hundreds of thousands or millions of dollars in direct and indirect economic benefits—facility usage, marketing exposure, student referrals, commission opportunities, and brand association. A single institutional partnership can equal the spending power of hundreds or thousands of individual consumers. Yet HBCUs consistently fail to recognize that their institutional spending decisions have exponentially more impact on wealth circulation than any individual consumer choice their students or alumni might make.

VUU’s partnership with Keller Williams is particularly emblematic of this pattern. According to the announcement, this collaboration will create “the first Keller Williams Real Estate Hub on an HBCU campus in Virginia” and will be “designed to bridge education, entrepreneurship, and real estate into one powerful ecosystem.” The goals are admirable: career readiness, economic mobility, wealth-building opportunities through real estate education and professional pathways. The partnership is positioned as being co-led by members of Delta Sigma Theta Sorority, Incorporated, with explicit language about sisterhood, brotherhood, and service in action. But here’s the question VUU administrators apparently didn’t ask: Why not create this “powerful ecosystem” with a Black-owned real estate company?

The assumption underlying most HBCU partnerships with non-Black firms seems to be that suitable Black-owned alternatives don’t exist. This assumption is demonstrably false. Black-owned real estate companies operate throughout the United States, including in Virginia and the Richmond area. These firms possess the expertise, resources, and commitment to serve HBCU students and alumni. United Real Estate Richmond, which describes itself as the largest Black-owned real estate firm in the Mid-Atlantic region, operates right in VUU’s backyard. CTI Real Estate is a Black-owned, woman-owned firm serving Virginia and Maryland. Nationally, companies like Braden Real Estate Group—a Black-owned Houston-based brokerage co-founded by Prairie View A&M University graduate Nicole Braden Handy—demonstrate the success of HBCU alumni in building substantial real estate businesses. H.J. Russell & Company, founded in 1952, stands as one of the largest minority-owned real estate firms in the United States. These Black-owned firms have proven track records of success, deep community connections, and explicit missions to build wealth in African American communities. These firms could provide the same—or better—opportunities that Keller Williams offers, with the added benefit of keeping wealth circulating in the Black community.

The difference would be transformative. A partnership with a Black-owned real estate firm would actually contribute to closing the wealth gap. It would demonstrate to students what Black excellence in business looks like. It would create mentorship opportunities with professionals who understand the unique challenges and opportunities facing Black Americans in real estate. It would ensure that the commissions, fees, and other economic benefits generated by the partnership stay within the African American economic ecosystem. Most importantly, it would model the institutional behavior necessary for true wealth accumulation—showing students that circulation of Black dollars must happen at every level, not just in their personal spending habits.

But to truly understand what institutional circulation looks like, consider this scenario: An African American real estate investment firm—owned by an HBCU alumnus and employing HBCU graduates as project managers, analysts, and development specialists—decides to develop a mixed-use building in Richmond. The firm uses Braden Real Estate Group to acquire the land. They secure financing from an African American bank like OneUnited Bank or Liberty Bank, supplemented by an investment syndicate of African American investors. The construction is handled by an African American-owned construction company like H.J. Russell & Company. When the transaction closes, it’s processed through Answer Title & Escrow LLC, the Black-owned title company founded by University of the District of Columbia alumna Donna Shuler. The property management contract goes to another Black-owned firm. The legal work is handled by Black attorneys. The accounting is done by a Black-owned firm.

This is what institutional circulation actually looks like. In this single development project, wealth circulates through multiple Black-owned institutions at every stage of the transaction. The bank earns interest income that it can then lend to other Black businesses and homeowners. The title company generates revenue that allows it to hire more staff and take on larger projects. The construction company builds its portfolio and capacity to compete for even bigger developments. The real estate investment firm creates returns for its Black investors and proves the viability of Black-owned development companies. The project managers and analysts gain experience that prepares them to start their own firms. Every single point in the transaction keeps wealth circulating within the African American economic ecosystem, building institutional capacity, creating jobs, generating returns, and proving that Black-owned institutions can handle sophisticated, large-scale projects.

Now contrast that with what happens when VUU partners with Keller Williams. Students may get training and even jobs as real estate agents, but the institutional wealth flows to Keller Williams—a non-Black company. The commissions generated by VUU-affiliated agents enrich Keller Williams’ franchise system. The brand association benefits Keller Williams’ reputation. The networking opportunities primarily connect students to Keller Williams’ existing (predominantly non-Black) networks. And when these students eventually facilitate property transactions, the ancillary services—financing, title work, legal services—typically flow to whatever institutions Keller Williams recommends, which are unlikely to be Black-owned.

The VUU-Keller Williams partnership might help individual Black students enter the real estate industry, but it does absolutely nothing to build the Black-owned institutional infrastructure necessary for true wealth building. In fact, it actively undermines that infrastructure by directing institutional resources and opportunities away from Black-owned firms. VUU essentially takes Black talent, students who could be building careers with Black-owned firms, and channels them into a non-Black institution, teaching them that Black institutions aren’t capable of providing the same opportunities.

This is the critical insight that HBCUs continue to miss: institutional circulation of capital is what builds lasting economic power. When individual Black consumers support Black businesses, they create important but limited impact. One person shopping at a Black-owned grocery store or banking with a Black-owned bank makes a difference, but a small one. When Black institutions support Black businesses, they create transformative, generational impact. An HBCU that partners with Black-owned banks, construction companies, real estate firms, technology providers, and service companies doesn’t just create individual transactions it builds an entire ecosystem of mutually reinforcing institutions that grow stronger together. This institutional ecosystem then has the power to compete with non-Black institutions, create opportunities at scale, and genuinely close wealth gaps.

Think about what would happen if every HBCU made a commitment to work exclusively with Black-owned institutions whenever viable alternatives exist. Imagine if all 101 HBCUs banked with Black-owned banks, used Black-owned construction companies for campus buildings, partnered with Black-owned real estate firms for student housing and community development, contracted with Black-owned technology companies for IT services, and hired Black-owned firms for legal, accounting, and consulting work. The combined institutional spending power of HBCUs would transform the Black business landscape. Black-owned banks would have hundreds of millions in deposits, allowing them to make larger loans and compete for more business. Black-owned construction companies would have steady revenue streams that would allow them to invest in equipment, hire skilled workers, and bid on larger projects. Black-owned real estate firms would have the institutional backing to compete for major developments. Black-owned technology companies would have the resources to innovate and scale.

But beyond the immediate economic impact, this institutional circulation would create something even more valuable: proof of concept. When Alabama State University chooses a Black-owned bank to handle a $125 million transaction, it proves that Black-owned financial institutions can handle sophisticated, large-scale deals. When VUU partners with a Black-owned real estate firm to create a campus-based real estate hub, it proves that Black-owned companies can deliver the same quality and scale as non-Black competitors. When HBCUs consistently work with Black-owned construction companies, law firms, accounting firms, and consulting companies, they build a track record of success that these firms can point to when competing for other major contracts. This institutional validation is precisely what Black-owned businesses need to break through the barriers that have historically excluded them from large-scale opportunities.

VUU’s partnership is not an isolated incident, it’s part of a troubling pattern. As HBCU Money has documented, only two HBCUs are believed to bank with Black-owned banks, meaning well over 90 percent of HBCUs do not bank with African American-owned financial institutions. This mirrors the broader pattern where over 90 percent of African Americans who attend college choose non-HBCUs, and in both cases, neither Black-owned banks nor HBCUs are able to fulfill their potential without the patronage and investment of those they were built to serve. Alabama State University’s $125 million decision to partner with a non-Black financial institution exemplifies what can be called “Island Mentality”—the failure of HBCUs to connect with and support the African American private sector. When Alabama State University had the opportunity to work with Black-owned banks and financial institutions, they chose to look elsewhere. Consider the irony: Howard University, African America’s flagship HBCU, partnered with PNC Bank, a Pittsburgh-based institution with over $550 billion in assets, more than 100 times the combined assets of all remaining Black-owned banks to create a $3.4 million annual entrepreneurship center. Meanwhile, Industrial Bank, a Black-owned institution with $723 million in assets, operates right in Howard’s backyard. PNC Bank’s executive team commanded $81 million in compensation in 2022 alone, while only one Black-owned bank in America has assets exceeding $1 billion. These decisions, like VUU’s partnership with Keller Williams, send a devastating message: even historically Black institutions don’t believe Black-owned businesses are worthy of their partnership.

The impact extends beyond symbolism. Every time an HBCU chooses a non-Black partner when Black alternatives exist, it represents lost revenue for Black-owned businesses that could have grown stronger, hired HBCU graduates, and created more opportunities. It represents missed networking opportunities for students who could have built relationships with Black business leaders. It represents weakened community ties that could have been strengthened through institutional support. It represents reduced political capital for the Black business community, which needs institutional backing to compete for larger contracts. And it perpetuates stereotypes about the capability and reliability of Black-owned businesses.

Let’s be clear about what “closing the wealth gap” actually requires. According to the Federal Reserve’s Survey of Consumer Finances, the median wealth of white families is approximately ten times greater than that of Black families. This gap didn’t emerge overnight, and it won’t close through symbolic gestures or partnerships that funnel Black talent and capital into non-Black institutions. Closing the wealth gap requires wealth creation within the Black community through business ownership and entrepreneurship. It requires wealth circulation that keeps dollars moving through Black-owned businesses before leaving the community. It requires wealth accumulation through strategic investments in Black-owned assets. And it requires wealth transfer across generations through education, mentorship, and institutional support.

When VUU partners with Keller Williams instead of a Black-owned real estate company, it fails on every single one of these requirements. The wealth created by student success in real estate will flow to Keller Williams and its predominantly non-Black agents. The circulation of capital will happen outside the Black community. The accumulation will benefit non-Black wealth holders. And the transfer of knowledge and opportunity will lack the cultural competency and community commitment that comes from working with Black-owned institutions. Most critically, VUU misses the opportunity to demonstrate to its students how institutional circulation of capital works, teaching them instead that even Black institutions should look outside their community for partnerships when it matters most.

The example of what institutional circulation could look like in real estate development isn’t theoretical it’s entirely possible right now with existing Black-owned institutions. When Donna Shuler founded Answer Title & Escrow LLC as a University of the District of Columbia alumna, she created exactly the kind of institutional capacity that makes the full-circle Black real estate ecosystem viable. As she explained in her interview with HBCU Money, title companies play a crucial role in every real estate transaction—they ensure clear ownership, coordinate closings, prepare legal documents, collect funds, and issue title insurance. Having a Black-owned title company means that millions of dollars in fees and service charges stay within the Black community rather than flowing out. Combined with Black-owned banks providing financing, Black-owned real estate firms handling acquisitions, Black-owned construction companies building the projects, and Black-owned development firms managing the entire process, you create a complete ecosystem where institutional wealth circulates multiple times before leaving the community.

This is what VUU could have created with its real estate initiative but chose not to. Instead of building an ecosystem where Black institutions strengthen each other, VUU created a pipeline that extracts Black talent and channels it into a non-Black institution. Students will learn real estate from Keller Williams, make connections through Keller Williams networks, and likely facilitate transactions that benefit Keller Williams and its associated service providers. The institutional wealth created by VUU’s endorsement and student pipeline flows entirely out of the Black community.

HBCUs often justify these partnerships by arguing that non-Black firms offer broader networks, more resources, or greater reach. This argument is both self-fulfilling and self-defeating. It’s self-fulfilling because when HBCUs consistently choose non-Black partners, they ensure that Black-owned businesses never gain the institutional backing needed to compete at scale. How can Black-owned real estate companies build the same networks as Keller Williams when HBCUs, the institutions that should be their natural partners, consistently choose their competitors? It’s self-defeating because it undermines the very purpose of HBCUs. These institutions were created because the existing educational ecosystem excluded Black Americans. They thrived by building their own networks, creating their own opportunities, and supporting each other. The suggestion that HBCUs now need to partner with non-Black institutions to succeed represents a fundamental abandonment of the HBCU mission and the institutional circulation principle that should guide their operations.

Imagine if VUU had instead announced a partnership with a coalition of Black-owned real estate companies. The announcement might have read: “Virginia Union University is proud to announce a groundbreaking partnership with Black-owned real estate firms across Virginia marking the creation of the first Black Real Estate Hub on an HBCU campus. This collaboration goes beyond sponsorship to create career readiness, economic mobility, and wealth-building opportunities for VUU students, alumni, and the Richmond community through real estate education, entrepreneurship, and professional pathways led by successful Black business owners including HBCU alumni. Students will learn not just how to sell houses, but how to build generational wealth through development, investment, and institutional deal-making within the Black business ecosystem. They will receive training from firms like United Real Estate Richmond, Braden Real Estate Group, and other Black-owned companies, with pathways to internships and employment that keep talent and capital circulating within the African American community. The initiative will explicitly connect students with Black-owned banks for financing education, Black-owned title companies for transaction processing, and Black-owned development firms for career opportunities in the full spectrum of real estate activities.”

Such a partnership would demonstrate commitment to the Black business community, create mentorship pipelines between Black students and Black business leaders, build economic power by concentrating resources in Black-owned institutions, establish replicable models for other HBCUs to follow, and generate authentic wealth-building that actually closes gaps rather than widening them. It would teach students the most important lesson about wealth building: that institutional circulation of capital within your community is what creates lasting prosperity, not individual success stories that extract value from the community.

Beyond economics, these partnership decisions carry enormous social and political implications. When HBCUs choose non-Black partners, they signal to their students, alumni, and communities that Black-owned businesses are insufficient, unreliable, or less capable. This message has devastating ripple effects. Students at HBCUs should graduate believing they can build successful businesses that serve their communities and compete at the highest levels. They should see their institutions modeling the behavior they’re encouraged to adopt. Instead, they witness their own universities choosing non-Black partners, learning an implicit lesson about the supposed superiority of non-Black institutions. They learn that while individual Black consumers should support Black businesses, institutions don’t have to follow the same principle. This creates a fundamental contradiction that undermines the economic empowerment message entirely.

Consider the message VUU sends with its Keller Williams partnership: “We’ll teach you to be real estate professionals, but we don’t believe Black-owned real estate companies are good enough to partner with us.” What are students supposed to take from that? That they should aspire to work for Black-owned firms, or that they should aim for the “real” opportunities at non-Black companies? That Black businesses can compete at the highest levels, or that even Black institutions don’t really believe that? The implicit message is devastating, and it’s reinforced every time an HBCU makes a major partnership announcement with a non-Black firm when Black alternatives exist.

This dynamic also weakens the political capital of the Black business community. When even HBCUs won’t support Black-owned businesses, it becomes nearly impossible for these firms to argue they deserve a seat at the table for major contracts, government partnerships, or policy decisions. If historically Black institutions don’t believe Black businesses are capable of handling significant partnerships, why would predominantly white institutions, corporations, or government agencies think differently? HBCUs, by failing to partner with Black-owned institutions, actively undermine the credibility and viability of the very businesses that could drive wealth creation in African American communities.

The solution isn’t complicated, though it requires courage and commitment. HBCUs must conduct systematic audits of all major partnerships and vendor relationships to identify where Black-owned alternatives exist. They must establish procurement policies that prioritize Black-owned businesses when quality and capability are equivalent. They should create development programs to help emerging Black-owned businesses build the capacity to serve as HBCU partners. They need to build collaborative networks connecting HBCUs with Black-owned banks, real estate firms, construction companies, technology providers, and other businesses. They must measure and report on the percentage of institutional spending directed to Black-owned businesses, creating transparency and accountability. And they need to educate all stakeholders—boards, administrators, faculty, students, and alumni—about why these partnerships matter for wealth gap closure and why institutional circulation of capital is the key to building lasting economic power.

Some will argue this approach is discriminatory or inefficient. This objection ignores history and reality. HBCUs exist because discrimination created the need for separate Black institutions. Having addressed educational exclusion by building their own colleges, it’s logical and necessary to address economic exclusion by building supportive business ecosystems. The focus on institutional circulation isn’t about excluding others; it’s about finally including Black-owned institutions in the economic opportunities that Black institutions create. It’s about recognizing that the same principle we apply to individual consumer behavior of circulate dollars in your community applies with exponentially greater impact at the institutional level.

The choice facing HBCUs is stark: continue operating as isolated islands that happen to serve Black students, or become integral parts of a thriving African American institutional ecosystem that builds collective power and prosperity. Virginia Union University’s partnership with Keller Williams, like Alabama State University’s financial decisions before it, represents the island mentality. These institutions take Black talent, Black energy, and Black resources, then channel them into non-Black institutions that have no structural commitment to Black community wealth-building. They preach to students about supporting Black businesses while their own institutional dollars flow to non-Black partners.

The real estate development scenario described earlier where an HBCU alumnus-owned development firm works with Braden Real Estate Group, Answer Title, a Black-owned bank, and a Black-owned construction company isn’t a fantasy. All of these institutions exist right now. The only thing preventing this kind of institutional circulation from becoming the norm rather than the exception is the willingness of HBCUs to make it a priority. When HBCUs choose to partner with Black-owned institutions, they don’t just create individual transactions they validate and strengthen an entire ecosystem of Black-owned businesses that can then compete for even larger opportunities.

True wealth gap closure requires HBCUs to fundamentally reimagine their role. They must see themselves not as individual institutions competing for resources and prestige, but as anchor institutions responsible for building and sustaining a broader African American economic ecosystem. This means prioritizing partnerships with Black-owned banks, real estate companies, construction firms, technology providers, and other businesses even when doing so requires more effort, more creativity, or more patience. It means recognizing that institutional circulation of capital is what transforms individual Black success stories into generational Black wealth accumulation. It means understanding that HBCUs have the power to create the very ecosystem they claim doesn’t exist by directing their substantial institutional resources to Black-owned businesses.

The question isn’t whether Black-owned alternatives exist. They do. The question is whether HBCU leaders have the vision, courage, and commitment to build an economic ecosystem that actually closes the wealth gap rather than simply talking about it. Until HBCUs make this fundamental shift, until they recognize that institutional circulation of capital is the key to wealth building and start directing their partnerships, contracts, and spending to Black-owned institutions these announcements about “groundbreaking partnerships” that close the wealth gap will remain what they are today: well-intentioned rhetoric that masks the continued extraction of Black wealth and talent for the benefit of other communities.

Individual African Americans can only do so much with their consumer dollars. The six-hour circulation rate in Black communities is a problem, but it’s a problem that individual behavior alone cannot solve. The real power lies at the institutional level. When an HBCU spends $10 million on a construction project with a Black-owned firm, that’s not the equivalent of 10,000 individual consumers each spending $1,000—it’s exponentially more powerful because institutional spending validates capacity, builds track records, creates jobs at scale, and proves viability in ways that individual transactions never can. But HBCUs, with their millions in institutional spending power, their influence over thousands of students and alumni, and their role as anchor institutions in Black communities, have the power to transform the economic landscape. They just need to recognize that the principle of dollar circulation they teach their students applies with even greater force to their own institutional behavior.

Until HBCUs start practicing institutional circulation of capital, until they recognize that every major partnership, every significant contract, and every spending decision is an opportunity to strengthen Black-owned institutions and build the ecosystem necessary for true wealth creation they will continue to be part of the problem rather than the solution to the wealth gap they claim to want to close. The infrastructure exists. The capable Black-owned businesses exist. The only thing missing is the institutional will to make Black economic ecosystem-building a priority over convenience, familiarity, or the perceived prestige of partnering with established non-Black firms. The choice is clear: HBCUs can continue channeling Black talent and capital out of the community, or they can finally commit to the institutional circulation that makes wealth gap closure actually possible.

Disclaimer: This article was assisted by ClaudeAI.

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Posted in Real Estate

Tagged African American economic ecosystem, alabama state university, Black business ecosystem, Black economic circulation, Black institutional economics, black wealth building, Black-Owned Businesses, Black-owned real estate, community wealth building, economic empowerment, HBCU alumni entrepreneurs, HBCU economic development, HBCU partnerships, HBCU procurement, HBCU vendor relationships, institutional circulation, institutional spending power, keller williams, racial wealth gap, virginia union university, wealth gap

How India Can Teach HBCUs And African America To Build Its Own Silicon Valley

Posted on January 20, 2026 by hbcumoney | Leave a comment

In the late 1990s, Bangalore wasn’t just a city—it was a story. A warm, chaotic tapestry of engineers coding in rented apartments, of global tech giants betting on untapped talent, and of policymakers quietly scripting India’s biggest soft power play. Two decades later, the city now dubbed the “Silicon Valley of India” commands global tech respect, home to startups valued in the billions and engineers powering the backends of everything from WhatsApp to NASA’s Mars missions. The rise of Bangalore wasn’t just a fluke of economics—it was a proof of concept.

And now, that proof has meaning beyond India. It’s a beacon for another global demographic long denied its shot at innovation supremacy: African America. Specifically, Historically Black Colleges and Universities (HBCUs), and the tech-ready minds they house. What if Atlanta, Raleigh, or Houston could do what Bangalore did? What if the lessons learned across oceans and caste lines could ignite the next Black-led tech renaissance?

It’s easy to forget, in the blinding glow of app IPOs and TED Talks, that Bangalore’s rise began with a simple premise: educate the best minds in technical skill and keep them connected. Post-independence India was dirt poor, but visionary. It seeded a string of engineering temples—the IITs (Indian Institutes of Technology)—and gave them one directive: create elite minds for a future not yet written. By the 1980s, the global economy began tilting toward software, and India’s bet on technical education paid off. Bangalore, strategically located and flush with graduates, attracted IBM, Texas Instruments, and eventually Microsoft and Google. Infrastructure followed policy. Ecosystem followed talent. And Bangalore turned into a tech vortex.

So why hasn’t something similar happened in Black America? In many ways, the African American and Indian narratives share some DNA. Centuries of marginalization. Outsized cultural contributions. Underutilized brainpower. But where India had the state-backed machinery of nation-building, HBCUs were born out of necessity. Underfunded, segregated, and often geographically sidelined, these institutions have long produced brilliance in spite of their conditions—not because of them. Still, the potential is staggering.

HBCUs produce 25% of all African American STEM graduates. Yet, most lack the kind of venture pipelines, incubator culture, and big-tech partnerships that turn skills into unicorns. India’s tech sector shows what happens when education is backed by policy, investment, and cultural mission. That trifecta is what HBCUs need to replicate—on their own terms.

First, HBCU campuses must become startup colonies. India didn’t wait for venture capital to fall from the sky. It built software parks—zones with tax incentives, broadband access, and office infrastructure. These became hotbeds for early startups and outsourcing deals. HBCUs can do the same. Howard’s Innovation Center is one of the few early experiments: a co-working space and incubator embedded on campus. But it’s not enough. Imagine Prairie View A&M spinning up a “Black Code Foundry” with dorm-hackathon hybrids, investor demo days, and embedded alumni venture scouts. Picture Southern University hosting a summer startup accelerator focused on agri-tech for Black farmers. The infrastructure doesn’t need to be perfect—India’s wasn’t—but it needs to exist.

Second, the alumni diaspora must become an angel army. Here’s the dirty secret behind India’s rise: the real money and mentorship came from abroad. Indian engineers who moved to Silicon Valley in the 1980s and 90s didn’t forget home. They wired money, built companies back in India, and sent their kids to the IITs they graduated from. Bangalore became an offshore brain extension of Palo Alto. HBCUs need the same loyalty loop. Black technologists at Google, Meta, and Apple shouldn’t just donate to alma maters—they should embed, invest, and mentor. A reverse brain trust—Black diaspora talent reinvesting in the pipeline they came from—could supercharge the entire system.

Third, code plus culture equals competitive advantage. India’s strength isn’t just in code. It’s in context. The best Indian tech products, from Flipkart to Paytm, were designed for the specific quirks of their users: cash-only commerce, slow networks, multilingual markets. That’s the play for African American tech, too. What if HBCUs trained developers not just in Python, but in designing fintech apps for unbanked Black users? Or telehealth tools for historically underserved zip codes? Black America has problems Silicon Valley doesn’t understand—and that’s a market advantage. Building for community isn’t charity. It’s a trillion-dollar design edge.

Fourth, policy must follow performance. One reason India succeeded is that its government saw tech as national strategy. It rolled out Special Economic Zones, offered tax holidays for startups, and treated engineering education as sacred. African American political leadership must adopt similar postures. Imagine a federal “Black Innovation Act” that grants funding to HBCU-based incubators, supports Black-owned VC firms, and protects patents developed at minority institutions. More tangibly, cities with large Black populations and HBCUs should offer land, broadband, and zero-interest loans to Black founders. If Chattanooga can build a public gigabit network, so can Tuskegee. Policy isn’t optional. It’s foundational.

Fifth, this requires narrative, not charity. India’s rise wasn’t framed as aid—it was ambition. It wasn’t “helping the poor.” It was “backing the next global power.” HBCUs and Black tech should be framed with the same boldness. The next Amazon might come from Alabama A&M. The next Oracle from Morgan State. What’s needed isn’t pity—but placement. African American founders shouldn’t be exceptions—they should be expectations. Tech journalism, film, and digital storytelling can help here. Highlight the successes. Build the lore. Change the perception.

Sidebar: What HBCUs Can Build Now

Move	Description	Potential Impact
Campus Incubators	On-site startup hubs with mentorship and funding access	Trains 1,000+ founders annually
Black Tech Diaspora Network	Online and in-person platform linking alumni with current students	Cross-generational capital + experience
Community-Centric Product Labs	Build tech for African American problems (e.g., finance, health, education)	Monetizes underserved user segments
Policy Consortium	HBCUs jointly lobbying for innovation policy with state + federal officials	Unlocks $1B+ in tech zone funding
Cultural Storytelling Units	Cross-discipline media studios to tell Black tech success stories	Shifts perception of HBCUs from “legacy” to “launchpad”

In a way, India’s tech story was never just about tech. It was about self-respect. About telling the world that brown minds could be global minds. That the future didn’t need to be imported. For African America, the stakes are the same. HBCUs are already proving grounds for cultural genius—music, politics, social theory. Tech should be next. A Black Silicon Valley doesn’t need to mimic the old one. It just needs to learn the playbook, remix the rhythms, and code to its own beat.

The next tech capital might not be in Cupertino or Shenzhen—but in the back streets of Atlanta, lit by the glow of laptop screens in an HBCU dorm room. Because somewhere out there, a kid from Jackson State is already building the future. All they need is the infrastructure—and the imagination—to finish the job. If India’s story is a testament to what happens when a nation believes in its brainpower, then the African American tech future will depend on whether HBCUs and their communities can believe in theirs—loudly, structurally, and unapologetically. Not for permission. But for power.

Disclaimer: This article was assisted by ClaudeAI and ChatGPT

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Posted in Technology

Tagged African American tech entrepreneurship, Black Silicon Valley, Black tech founders and venture capital, Building tech ecosystems in underserved communities, HBCU innovation and startups, HBCU tech ecosystem, HBCUs and STEM education, How India built its Silicon Valley, IIT Madras vs Howard University, India Bangalore tech success

Credit Card Rate Caps Could Deepen Financial Inequality for African American Households

Posted on January 17, 2026 by hbcumoney | Leave a comment

Our credit system, like almost institutional reality we have is very much dependent on Others. Until we realize and work towards infrastructure of our own institutional ownership within the credit landscape, then we will continue to be prey for predators and subsidizers that enriches others and their institutions. – William A. Foster, IV

When President Donald Trump announced a proposed 10% cap on credit card interest rates in January 2026, most Americans greeted the news with skeptical hope. The move seemed like a potential lifeline for families struggling with debt burdens and interest rates that often exceed 20%, even as many questioned whether it could actually happen. But for African American households, this well-intentioned policy could become another barrier in a financial system that has historically excluded and disadvantaged them.

The challenge lies not in the intention behind rate caps, but in their likely consequences. While lower interest rates sound beneficial on the surface, the economic reality of credit markets means that banks facing reduced profitability will respond by restricting who can access credit in the first place. For African American families already fighting against systemic barriers to financial services, this could close doors that were only partially open to begin with.

African American households face dramatically different credit market realities than their white counterparts. According to the FDIC’s 2023 survey, more than 10% of Black Americans lack access to basic checking or savings accounts, compared to just 2% of white Americans. This banking gap represents more than inconvenience it fundamentally limits the ability to build the credit history that determines access to affordable loans, mortgages, and yes, credit cards.

The wealth disparity tells an even starker story. The median net worth of white households stands at approximately $188,200, nearly eight times the $24,100 median for Black households. This gap isn’t accidental it’s the product of generations of discriminatory policies from redlining to predatory lending, compounded by the deterioration of African American-owned banks and credit unions. As Black ownership of financial institutions has declined, the community has become more reliant on external institutions for credit, creating conditions that invited more predatory lending into African American neighborhoods. When African Americans do access credit, they consistently face higher interest rates than white borrowers with similar incomes. High-income Black homeowners, for instance, receive mortgage rates comparable to low-income white homeowners.

The dependence on consumer credit has reached critical levels in African American households. Recent analysis from HBCU Money’s 2024 African America Annual Wealth Report reveals that consumer credit has surged to $740 billion, now representing nearly half of all African American household debt and approaching parity with home mortgage obligations of $780 billion. This near 1:1 ratio between consumer credit and mortgage debt represents a fundamental inversion of healthy household finance. For white households, the ratio stands at approximately 3:1 in favor of mortgage debt over consumer credit. The African American community stands alone in this precarious position, where high-interest, unsecured borrowing rivals the debt secured by appreciating assets.

These disparities matter enormously when considering how banks will respond to rate caps. Credit card companies operate on risk-based pricing models, charging higher rates to borrowers they perceive as riskier based on credit scores, income stability, and banking relationships. African American borrowers, because of structural disadvantages in each of these areas, already cluster in categories that receive higher interest rates. When banks can no longer charge those rates, they will simply stop offering credit to these borrowers entirely.

The banking industry’s response to Trump’s proposal has been swift and unequivocal: a 10% interest rate cap would force them to dramatically restrict credit availability. Analysis from the American Bankers Association suggests that nearly 95% of subprime borrowers, those with credit scores below 680 would lose access to credit cards under even a 15% cap. With rates currently averaging around 20%, a 10% ceiling would affect even more borrowers. Industry analysts estimate that between 82% and 88% of credit cardholders could see their cards eliminated or their credit limits drastically reduced. The Electronic Payments Coalition warns that low to moderate income consumers would be hit hardest, precisely the demographic where African American households are disproportionately represented.

This isn’t just industry fearmongering. Historical evidence supports these concerns. When Illinois implemented a 36% APR cap on all borrowing, lending to subprime borrowers plummeted. Similar patterns emerged from 19th-century usury laws and research on payday loan restrictions. The consistent pattern is clear: when rate caps make lending unprofitable, lenders exit the market or tighten requirements. For African American households, this creates a devastating catch-22. They’re more likely to need credit due to lower wealth levels and less access to family financial support. Yet they’re also more likely to be denied that credit or pushed into predatory alternatives when traditional sources dry up.

The credit card industry categorizes borrowers by risk, with subprime borrowers facing the highest rates but also the greatest need for access to credit. African American consumers are overrepresented in subprime categories, not because of personal failing but because of systemic factors that suppress credit scores. Historical discrimination in housing, employment, and lending created wealth gaps that persist through generations. Lower wealth means less ability to weather financial shocks, leading to missed payments that damage credit scores.

When major banks stop serving subprime borrowers, those families don’t suddenly stop needing credit. They turn to alternative sources and here’s where the rate cap could cause real harm. Payday lenders, pawn shops, auto title loans, and other fringe financial services often charge effective annual percentage rates far exceeding credit card rates, sometimes reaching 300% to 400% or higher. These services operate in a less regulated space where consumer protections are weaker and predatory practices more common.

African American neighborhoods already contain disproportionately high concentrations of these alternative lenders, a modern echo of historical redlining patterns. Bank branches are scarce in many predominantly Black communities, while check-cashing outlets and payday loan storefronts proliferate. A rate cap that drives more families into this unregulated market would exacerbate existing inequities. The irony is profound. A policy designed to protect consumers from high interest rates could push vulnerable families toward even higher costs and fewer protections. JPMorgan analysts warned that the rate cap could redirect borrowing away from regulated banks toward pawn shops and non-bank consumer lenders, increasing risks for consumers already under financial strain.

The consequences of restricted credit access extend far beyond the immediate inability to make purchases. Credit cards serve as emergency funds for families without substantial savings, a category that includes a disproportionate number of African American households. For many Black families facing persistent income gaps, credit cards function not just as a convenience but as an income supplemental tool, helping to bridge the gap between earnings and the actual cost of living. When a car breaks down, a medical bill arrives, or a job loss creates temporary income disruption, credit cards can mean the difference between weathering the storm and falling into a debt spiral that damages credit for years.

The reality is that consumer credit has become essential infrastructure for African American household finance. With consumer credit growing by 10.4% in 2024, more than double the 4.0% growth in mortgage debt, Black families are increasingly dependent on expensive borrowing to maintain living standards. This isn’t a choice so much as a structural reality of trying to survive on incomes that remain roughly 60% of median white household income while facing higher costs for everything from insurance to groceries in predominantly Black neighborhoods.

Small business ownership represents another critical pathway to wealth building where African Americans face systemic barriers. Black entrepreneurs already struggle to access business loans, with approval rates significantly lower than for white business owners with similar qualifications, another systemic issue from African American banks and credit unions having limited deposits and being unable to extend loans and credit. Many small business owners use personal credit cards to fund startup costs, inventory purchases, and cash flow gaps. Restricting credit card access would eliminate this crucial financing option for aspiring Black entrepreneurs.

The rewards and benefits ecosystem could also shift dramatically. Banks have indicated they would likely reduce or eliminate rewards programs to offset lost interest income from rate caps. While this might seem minor compared to interest savings, rewards programs have become an important tool for building value, particularly for higher-credit consumers who pay balances in full monthly. The Vanderbilt Policy Accelerator research found that borrowers with credit scores of 760 or lower would see reductions in credit card rewards under a rate cap. Perhaps most concerning is the potential for credit scoring and financial history deterioration. When credit lines are closed or limits reduced, credit utilization ratios increase, which damages credit scores. This creates a downward spiral where reduced access leads to worse credit, which leads to further reduced access. For African American families working to build credit and financial stability, this could set progress back by years.

The genuine problem of high credit card interest rates and mounting consumer debt deserves serious policy attention. But effective solutions must account for how credit markets actually function and who would be most affected by reduced access. Rather than interest rate caps, policymakers should consider approaches that expand access while addressing affordability. Strengthening African American-owned banks, credit unions, and community development financial institutions would restore economic self-determination to communities that once had thriving financial ecosystems. These institutions don’t just serve African American communities they’re owned by them, led by them, and invested in their long-term prosperity. Historically, Black-owned banks have proven they can maintain sound lending practices while understanding the full context of their customers’ financial lives in ways that large, distant institutions simply cannot.

Currently, there are only 18 Black or African American owned banks with combined assets of just $6.4 billion, a tiny fraction of the industry. The absence of robust Black-owned financial institutions means that virtually all of the $740 billion in consumer credit carried by African American households flows to institutions outside the community. With African American-owned banks holding assets equivalent to less than 1% of Black household debt, the overwhelming majority of interest payments—potentially $120 billion annually—enriches predominantly white-owned institutions with no vested interest in Black wealth creation or community reinvestment. This extraction mechanism operates continuously, draining capital that could otherwise be intermediated through Black-owned institutions to support local lending and community development.

Strengthening requirements for transparent pricing, fee limitations, and responsible lending standards could protect consumers without eliminating credit availability. Regulators could mandate clearer disclosure of total costs, limit penalty fees that disproportionately burden those already struggling, and establish guardrails against predatory terms while preserving access to credit itself. Yet even these modest reforms face an uphill battle in the current political climate. The reality is that meaningful policy solutions require political will that simply doesn’t exist right now for addressing racial economic disparities directly. This makes the unintended consequences of blunt instruments like interest rate caps even more dangerous—they can restrict credit access under the banner of consumer protection while offering no viable alternatives.

The fundamental reality is clear: waiting for federal policy to solve credit access problems is a losing strategy. African American households face a specific set of economic challenges rooted in a specific history, and the solutions must be equally specific not generic approaches that treat all groups the same. The path forward requires African American communities to build their own financial infrastructure. This means capitalizing and expanding Black-owned banks and credit unions that can offer credit products designed for the actual economic realities of their customers, not risk models built on white wealth patterns. It means creating community-based lending circles and cooperative credit arrangements that leverage collective resources. It means developing alternative credit scoring systems that account for rent payments, utility bills, and other financial behaviors that traditional models ignore.

Rebuilding this sector isn’t about charity or inclusion; it’s about economic self-determination. Black-owned financial institutions have historically understood that a credit score doesn’t tell the whole story of a person’s creditworthiness, and they’ve made sound lending decisions based on relationship banking and community knowledge that large institutions can’t replicate. The challenge isn’t convincing European American owned banks to be fairer, it’s building the capacity to not need them as much. When African American communities had stronger networks of Black-owned banks, insurance companies, and credit unions, they had more options and more power. Rebuilding that infrastructure, combined with individual financial strategies that emphasize building assets and reducing dependence on consumer credit, offers a more sustainable path than hoping for beneficial federal intervention.

A 10% interest rate cap might sound appealing in the abstract, but for African American households, it likely means one thing: less access to the credit system entirely. The question then becomes not whether mainstream banks will treat Black borrowers fairly, but how communities can create their own credit access systems that serve their actual needs. That’s not a policy problem it’s a community capacity problem, and it requires community-driven solutions.

Disclaimer: This article was assisted by ClaudeAI.

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Posted in Banking & Credit Unions

Tagged African American consumer debt, African American wealth extraction, alternative credit systems, Black entrepreneurship financing, Black household debt crisis, Black-owned banks crisis, community financial institutions, consumer credit inequality, credit access disparity, credit card interest rate cap, credit score discrimination, economic self-determination, economy, finance, investing, Minority Depository Institutions, money, mortgage to consumer debt ratio, payday lender risks, Personal Finance, predatory lending alternatives, Racial wealth gap solutions, subprime borrowers credit access, Trump credit card policy, unbanked Black Americans

Institutional Agriculture: How HBCUs and Black Banks Can Build a Farm Credit System of Our Own

Posted on December 19, 2025 by hbcumoney | Leave a comment

It’s tough for all farmers, but when you throw in discrimination and racism and unfair lending practices, it’s really hard for you to make it. – John Boyd, Jr., Founder of the National Black Farmers Association

America’s oldest financial divide is agricultural. Once, the majority of African Americans lived and labored on land; now, less than 1.4% of the nation’s 3.4 million farmers are African American. The disappearance of Black farmers is not only a human story—it is a story of capital deprivation, institutional neglect, and the collapse of an ecosystem that once linked land, education, and community credit. To reverse this, imagine if each of the 19 land-grant institutions in the 1890 HBCU system committed $1 million from their endowments and alumni associations to create a unified private lending fund. This $19 million “1890 Fund” would not sit passively in treasuries or bond portfolios but circulate directly through African American banks and credit unions, financing African American farmers and food producers across the country. Such a fund would be modest in scale but revolutionary in concept, a self-directed act of institutional cooperation that reconnects three critical arteries of African American economic life: land-grant HBCUs, African American financial institutions, and Black agricultural producers.

The 1890 HBCUs, institutions such as Tuskegee University, Prairie View A&M, North Carolina A&T, and Florida A&M were established as part of the Second Morrill Act of 1890 to serve African Americans excluded from the original land-grant colleges. Their purpose was not abstract scholarship but applied science: to teach, research, and extend knowledge about agriculture, engineering, and the mechanical arts. Over time, many of these schools evolved into comprehensive universities. Yet the decline of Black farmers and the consolidation of farmland under non-Black ownership represent a direct erosion of the very population these universities were created to serve. Between 1910 and 2020, African American land ownership fell by roughly 90%, from an estimated 15–16 million acres to less than 2 million today. The structural dispossession through discriminatory lending, heirs’ property laws, and USDA bias has left African American farmers with less access to credit and fewer pathways to generational land retention. HBCUs were founded to be a shield against such vulnerability. The 1890 Fund would revive that founding spirit, transforming their agricultural programs and extension centers into engines of financial empowerment rather than merely research hubs dependent on federal grants.

Each 1890 HBCU would allocate $1 million from a combination of its endowment and alumni association reserves, with matching commitments encouraged through philanthropic donors or corporate partners. The pooled fund $19 million at launch would be professionally managed under a cooperative structure, similar to a community development financial institution or business development company. The fund would not make direct loans itself but would place its capital into African American-owned banks and credit unions identified in HBCU Money’s 2024 African American-Owned Bank Directory. Institutions such as OneUnited Bank, Industrial Bank, Citizens Trust Bank, and smaller but vital credit unions like FAMU Federal Credit Union or Hope Credit Union would serve as the lending conduits. In effect, the 1890 Fund would function as the “wholesale” capital pool of low-interest (but profitable), long-duration deposits or certificates placed with African American banks that, in turn, originate and service loans to qualified African American farmers, cooperatives, and agri-businesses. Loans would range from $25,000 micro-lines for new producers to $500,000 or more for established operations seeking equipment, irrigation, or land expansion. Priority would be given to farmers with relationships to HBCU agricultural programs such as those who have completed workshops, extension training, or student partnerships. Each bank or credit union participating would commit to transparent reporting, with loan performance and demographic data shared annually with the 1890 Foundation. The revolving structure of repayments would ensure that as farmers succeed, their payments replenish the pool for new borrowers creating a regenerative loop of institutional and community wealth.

Routing the fund through African American financial institutions is not symbolic it is structural. Historically, Black farmers were denied access to credit through traditional banks and faced redlining by federal programs. Even today, USDA lending disproportionately benefits white farmers. African American banks and credit unions remain among the few institutions with both the cultural understanding and community trust necessary to underwrite these borrowers responsibly. Moreover, these banks themselves are chronically undercapitalized. With combined assets of roughly $7.5 billion across the sector, African American banks represent barely 0.001% of total U.S. banking assets, insufficient to exert meaningful influence in national credit markets. By placing deposits into these banks, HBCUs would strengthen their liquidity ratios, reduce dependence on volatile retail deposits, and expand lending capacity far beyond the fund’s nominal amount through fractional reserve leverage. In short, every dollar committed by an HBCU could translate into $7–$10 in agricultural lending capacity once multiplied through the banking system.

HBCU alumni associations hold untapped potential as financial intermediaries. While endowments must operate under fiduciary and investment constraints, alumni associations often have greater flexibility. They can act as private limited partners in the 1890 Fund, contributing capital from dues, life membership funds, or targeted campaigns such as “Adopt-a-Farmer.” Imagine an alumni chapter of Florida A&M underwriting 10 acres of hydroponic greens for a local farmer who agrees to hire FAMU agriculture graduates. Or Prairie View alumni pooling funds to purchase cold-chain trucks for dairy producers across Texas. These actions extend the HBCU brand into the real economy transforming loyalty into tangible economic development. Each alumni association could also create its own micro-fund linked to the central 1890 Fund, mirroring the “chapter endowment” concept used by major universities. This networked structure would democratize investment and bring the broader African American middle class into the process of agricultural renaissance.

Lending alone does not sustain farmers; ecosystems do. The 1890 Fund would operate most effectively if it integrated with the broader HBCU agricultural and business infrastructure. HBCU agricultural economists could conduct continuous impact analysis tracking how capital access affects yields, profitability, and land retention. Their findings would strengthen advocacy for increased African American private capital. Extension programs could pair loan recipients with agronomists and soil scientists to ensure that capital is used productively and sustainably. HBCU-affiliated food labs, hospitality programs, and dining services could prioritize procurement from funded farmers, creating closed-loop demand. Business schools could develop crop insurance products and risk models tailored to small producers, mitigating the vulnerability that has historically devastated African American farms. Student internships in finance, agriculture, and data science could be embedded in the fund’s operations training the next generation of agricultural financiers and analysts. This approach transforms the 1890 Fund from a mere loan pool into a comprehensive agricultural development platform.

The greatest strength of the 1890 Fund lies in its multiplier effect. Consider: $19 million revolving annually at a conservative 6% loan rate generates roughly $1.1 million in annual interest income—income that can be reinvested or partially distributed back to participating universities to grow the fund. If repayments are recycled annually, the fund could underwrite over $100 million in cumulative loans within its first decade. The macroeconomic ripple is job creation, land retention, and input purchases that would expand rural GDP in African American counties and increase deposit growth for the participating banks. Contrast this with the status quo: endowment funds largely held in Wall Street instruments that yield moderate returns but generate no localized impact. By re-directing even a fraction of assets into mission-aligned community lending, HBCUs align their investments with their historic purpose of educating and empowering the descendants of those who built the land.

The global contest for food security is intensifying. Nations that control food production, water, and soil fertility will control the future. For African America, regaining agricultural capacity is not nostalgic it is strategic. Every acre restored to productive use by African American farmers increases food sovereignty and reduces dependence on foreign or corporate supply chains. If HBCUs act collectively through the 1890 Fund, they position themselves as key players in regional and national food policy. They could partner with African universities for climate-resilient crop research, link with Caribbean agricultural cooperatives for trade, and develop transatlantic agribusiness ventures under the banner of Black institutional power. Such cooperation would redefine “land-grant” for the 21st century not as a relic of American expansion but as a global model of Pan-African capital deployment.

The road to building the 1890 Fund will not be smoothed by political cooperation. The federal and state governments that oversee the 1890 land-grant system are, in many cases, openly hostile toward African American advancement. Most of the 1890 HBCUs operate in states where racial resentment, austerity politics, and legislative interference remain the norm. These are states that have withheld or delayed millions in matching funds, imposed discriminatory audits, and used political appointments to keep HBCUs subordinate to their predominantly white peers. Under such conditions, the 1890 Fund is not merely an investment vehicle it is a form of institutional defense. Federal and state policy cannot be relied upon to sustain African American agriculture or financial independence. The only realistic path forward is one where HBCUs, alumni associations, and African American banks coordinate their own internal economy of capital, shielded from political manipulation.

This is where the 1890 Foundation becomes indispensable. Established to support the collective mission of the 1890 universities, the Foundation already exists as a neutral, centralized, and professionally managed entity capable of administering joint initiatives on behalf of all 19 institutions. Tasking it with managing the 1890 Fund would provide immediate credibility, legal infrastructure, and continuity. The Foundation could structure the fund as a private, revolving loan pool, capitalized through contributions from university endowments, alumni associations, and strategic partners, while remaining beyond the reach of hostile state legislatures. Governance through the 1890 Foundation would also protect participating universities from political retaliation. Rather than each HBCU appearing to act independently potentially inviting scrutiny from governors or state boards the fund’s activities could be coordinated under the Foundation’s national charter. This collective structure would allow for scale, professional risk management, and a unified investment policy aligned with the long-term interests of African American farmers and institutions.

Nevertheless, challenges remain. Some university boards, especially those with state-appointed trustees, may hesitate to commit endowment dollars to what they perceive as politically sensitive or unconventional investments. The uneven size of endowments ranging from under $50 million at smaller 1890s to more than $200 million at the largest could create tensions over proportional contributions. And while the 1890 Foundation provides an ideal governance structure, it would still need to secure regulatory clarity and investment expertise to manage a multi-million-dollar lending operation through external financial institutions. These risks, however, are outweighed by the opportunity to build economic sovereignty in an era of state hostility. The very conditions meant to weaken HBCUs like political obstruction, financial starvation, and bureaucratic oversight can become the catalysts for collective independence. If the 1890 Fund channels its capital through African American banks and credit unions, it strengthens two institutional pillars simultaneously: HBCUs regain control over how their endowments circulate, and Black-owned financial institutions gain the liquidity and leverage they need to expand.

The political hostility surrounding 1890 HBCUs should not be seen as a deterrent, but as confirmation of why this fund must exist. It demonstrates that African American progress, even in the 21st century, cannot depend on state benevolence. By empowering the 1890 Foundation to manage a private, self-sustaining fund, HBCUs would be acting in the same spirit of independence that defined their creation in 1890 when the federal government forced states to either open their existing land-grant colleges to Black students or create new ones for them. The 1890 Fund would be the modern continuation of that act of defiance transforming exclusion into enterprise. Through the 1890 Foundation’s leadership, African American endowments, farmers, and banks could finally operate in unison, beyond the grasp of state control. In doing so, they would build not just a lending mechanism, but a shield—a financial structure capable of outlasting political hostility and securing the long-term survival of Black agricultural and institutional power.

If the 1890 Fund fulfills its purpose, its long-term success should evolve into something even greater, a joint venture between the 1890 Foundation, African American banks, and African American credit unions that establishes a new national financial institution: one modeled on the Farm Credit System but existing independently from it to preserve full financial sovereignty. The Farm Credit System is a government-sponsored network of cooperative lenders that provides over $400 billion in loans and financial services to farmers, ranchers, and agricultural businesses across the United States. Its reach is vast and influential, covering roughly 40% of all agricultural debt in the country. Yet African American farmers have historically been excluded from its benefits. The FCS, like much of American agricultural policy, was built in an era when Black ownership was being systematically dismantled. It became a backbone for white rural wealth while African American farmers were left to navigate a labyrinth of local banks, discriminatory USDA programs, and predatory lending.

A successful 1890 Fund would prove that African American institutions: universities, banks, and credit unions can design a credit network capable of rivaling the FCS’s effectiveness, without its dependencies or racial exclusions. Over time, this collaboration could be formalized into a joint enterprise: the African American Agricultural Credit Alliance: a cooperative, member-driven, nationwide system built to finance not just farms but the entire food and fiber value chain. Like the FCS, it could be composed of multiple regional lending cooperatives, each capitalized by a blend of HBCU endowment investments, bank deposits, and credit union member capital. At its center would sit a national coordinating body responsible for liquidity management, risk pooling, and bond issuance. But unlike the FCS, this alliance would be entirely private and its governance drawn from the 1890 Foundation, the African American Credit Union Coalition, and the National Black Farmers Association. The goal would not be to replicate the FCS’s structure exactly but to rival its scale, providing affordable credit, insurance, equipment financing, and agri-business investment under the umbrella of Black-owned control.

Refusing to integrate into the existing Farm Credit System is not a rejection of efficiency it is a declaration of sovereignty. The FCS, though cooperative in name, ultimately answers to federal regulators, congressional committees, and a system of oversight that has never prioritized Black agricultural survival. Independence ensures that capital allocation decisions remain rooted in African American priorities—restoring land, building ownership, and sustaining communities rather than maximizing short-term returns. Financial sovereignty also allows for creative lending models that the FCS cannot adopt under federal restrictions, such as cooperative land trusts, heirs’ property buyouts, carbon-credit-backed collateral, or blockchain-based agricultural exchanges.

The evolution from the 1890 Fund to a fully realized agricultural credit system would expand capital from millions into billions. Once the fund demonstrates consistent performance, its track record could attract institutional investors like African American foundations, pension funds, and even sovereign funds from the African diaspora seeking mission-aligned, asset-backed investments. Through securitization and bond issuance, the alliance could channel long-term capital into rural Black communities, funding everything from precision agriculture and agroforestry to food processing and logistics. This would make agriculture once again an attractive sector for young entrepreneurs and HBCU graduates. Over time, the 1890 Fund could thus mature into an ecosystem capable of reindustrializing Black rural America through ownership and control of capital.

The creation of such a system would carry global implications. It could link with agricultural cooperatives in Africa and the Caribbean, forming a transatlantic agricultural finance corridor and positioning African American institutions as both lenders and investors in global food systems. The founding of the 1890 Fund, therefore, would not be an endpoint but the beginning of a long journey toward financial nationhood. The eventual establishment of an independent agricultural credit alliance would mark the institutionalization of economic sovereignty—a transformation from temporary coordination to permanent capacity.

The 1890 Fund embodies the principle that power comes from ownership, not participation. For too long, African American institutions have waited for external validation or federal rescue. The tools for rebuilding agricultural sovereignty already exist: universities with land and research infrastructure, banks with local lending channels, and farmers with generational knowledge. When linked together, these elements form a complete ecosystem capable of restoring both land and leverage. The $1 million commitment from each 1890 HBCU would not be a gift it would be a strategic investment in self-determination. If executed, within a generation the 1890 Fund could help reclaim millions of acres, incubate thousands of Black-owned farms, and expand the asset base of African American financial institutions. It would also serve as a model for other sectors like manufacturing, housing, and technology demonstrating how collective capital deployment transforms a marginalized community into a nation within a nation.

As Dr. Booker T. Washington once observed, “No race can prosper till it learns that there is as much dignity in tilling a field as in writing a poem.” The modern corollary is that no people can be free until they can finance their own fields. The 1890 Fund is not only a mechanism for loans it is a blueprint for liberation through institutional coordination. Its success could lay the groundwork for a sovereign financial architecture that, like the land it seeks to reclaim, will belong entirely to the people who cultivate it.

Disclaimer: This article was assisted by ChatGPT.

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Posted in Banking & Credit Unions

Tagged 1890 hbcus, african american farmers, agricultural finance, black banks, Black economic institutions, Black farm ownership, community development finance, cooperative lending, credit unions, food sovereignty, HBCU alumni associations, hbcu endowments, HBCU investment strategy, land-grant universities, rural empowerment

With So Much Oil In HBCU States – Where Are HBCU Alumni Owned Energy Firms?

Posted on December 12, 2025 by hbcumoney | Leave a comment

“If you can provide the funding and you get the leadership, you’ll have a competitive team.” – T. Boone Pickens

The Southern United States is awash in energy. From Texas to Louisiana, Mississippi to Alabama, these states are responsible for the bulk of America’s oil and gas production. They are also home to the vast majority of Historically Black Colleges and Universities (HBCUs), institutions that have graduated generations of African American engineers, scientists, and business professionals. Yet, despite the geographic overlap and the energy sector’s enormous influence, there is an unmistakable void when it comes to HBCU alumni-founded firms in oil, gas, or even renewables. It is a paradox of proximity without participation—resources in abundance, yet ownership remains out of reach.

This disconnect is not simply a function of chance. It is the product of historical exclusion, structural barriers, and decades of capital disinvestment. The energy industry, especially oil and gas, has long been one of the most capital-intensive and closed sectors of the U.S. economy. The upstream business of exploration and drilling is not built for first-time entrepreneurs without deep-pocketed backers, multigenerational industry ties, or significant institutional support. Most HBCU alumni have none of the above.

For much of the 20th century, Black Americans were excluded from both land ownership in oil-rich regions and the educational infrastructure required to engage in the energy economy. HBCUs historically focused on liberal arts, education, and public service—disciplines that addressed urgent post-emancipation needs and segregation-era employment restrictions. Petroleum engineering, energy policy, and oil finance were simply not part of the curriculum. And while HBCUs today have engineering programs, few have the dedicated energy labs, industry partnerships, or commercialization infrastructure that their predominantly white counterparts enjoy. At places like the University of Texas or Texas A&M, oil research institutes, private equity-backed incubators, and billion-dollar endowments serve as launchpads for energy ventures. No HBCU currently operates at that scale.

Then there is the question of capital. Even if an HBCU graduate had the technical know-how and vision to build an energy company, the financing would almost certainly be out of reach. According to the Federal Reserve’s most recent small business credit survey, Black entrepreneurs are more likely to be denied loans, receive lower funding offers, and face higher interest rates. In oil and gas, where drilling a single exploratory well can cost millions, these hurdles become insurmountable. And in the renewable energy space, which requires less upfront capital but still demands serious investment and regulatory navigation, Black founders are still underrepresented. Less than 2% of clean energy businesses are Black-owned, a figure confirmed by data from the Department of Energy and Brookings Institution.

There are, however, rare examples that offer a blueprint for what could be. Volt Energy, a solar development firm founded by HBCU alumnus Gilbert Campbell, has successfully executed projects for corporate and government clients. Its success is owed not just to entrepreneurial grit, but to strategic positioning in the rapidly growing clean energy sector and the willingness of federal partners to prioritize minority-owned firms. Another example is PEER Consultants, founded by Dr. Lilia Abron, an environmental engineering firm that has spent decades advancing sustainability and energy access in underserved communities. These stories are powerful but isolated.

Public and private efforts to address the imbalance are underway, albeit slowly. The Biden Administration’s Justice40 initiative mandates that 40% of certain federal climate investments benefit disadvantaged communities, opening the door for more HBCU-linked projects. The Department of Energy’s HBCU Clean Energy Education Prize, launched in 2023, is another signal of intent. It provides multi-million-dollar funding to HBCUs for curriculum development, student research, and partnerships in clean energy. But such programs are only as impactful as the ecosystems that surround them. Without access to long-term venture funding, procurement opportunities, and business mentorship, their reach will be limited.

Much of the challenge lies within institutional economics. The endowment gap between HBCUs and wealthier PWIs (predominantly white institutions) is massive. The entire HBCU sector holds less than $6 billion in endowment funds. By contrast, the University of Texas system—heavily funded by state oil revenues—controls more than $30 billion through its UTIMCO investment vehicle. These endowments don’t just fund scholarships; they finance research labs, spinouts, and equity investments in faculty or alumni-founded ventures. HBCUs, without comparable financial arms, cannot deploy the same kind of catalytic capital.

In this environment, oil-rich states like Texas, Louisiana, and Mississippi may continue to generate immense wealth from energy while HBCU alumni remain employees at best and consumers at worst. Ownership, the core driver of generational wealth and political leverage, continues to elude them.

But the renewable transition could offer an inflection point. The barriers to entry are lower, the policies more inclusive, and the urgency to diversify the energy economy is real. Solar and battery storage firms don’t require billion-dollar capex or land acquisition. Distributed energy resources, community solar projects, energy efficiency startups, and green construction ventures are all areas where HBCU alumni could lead—if properly funded and supported.

That shift requires vision, not just from government, but also from philanthropists, Black-owned banks, and corporate ESG programs. Capital alone, however, will not solve the problem. HBCUs must also expand their academic footprint into energy entrepreneurship, clean tech commercialization, and regulatory policy. More importantly, HBCU alumni must begin to see energy not just as an employer, but as a domain in which to build power, both economic and political.

The stakes are higher than ever. Energy is not simply about electricity or gasoline—it is about who owns the infrastructure of the future. Whether it’s solar farms, transmission networks, EV charging corridors, or hydrogen production, the assets being built today will define tomorrow’s winners. If HBCU graduates are not in the room now, they risk being locked out of that ownership for another generation.

The irony of standing on land that produces billions of dollars in oil revenues while holding none of the titles is no longer tolerable. The future energy economy must be diverse not only in technology but in ownership. For HBCUs, the time to act is now—not for symbolic inclusion, but for structural participation.

From fossil fuels to photovoltaics, the opportunity exists to move from resource curse to resource empowerment. Whether that opportunity is seized will depend on whether HBCUs, their alumni, and their partners choose to build ownership into the core of their energy future, or remain content with being near power, but never in control of it.

Supporting Data & Charts

1. Oil Production by HBCU States (2023, million barrels):

State	Production	Number of HBCUs
Texas	20,000	8
Louisiana	446	4
Mississippi	113	6
Alabama	27	14
Oklahoma	1,830	1

2. Black-Owned Firms in Energy (2022):

Sector	% Black Ownership
Oil & Gas Extraction	<1%
Solar Installation	1.3%
Energy Consulting	2.1%
Utility-Scale Renewables	0.5%

3. Endowment Comparison (2024):

Institution/System	Endowment ($B)
Harvard University	53.2
Stanford University	37.6
All HBCUs Combined	5.2
UTIMCO (Texas System)	65.3

Disclaimer: This article was assisted by ChatGPT.

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Posted in Entrepreneurs

Tagged African American oil business, Black-owned energy companies, clean energy equity, endowment gap HBCUs, HBCU alumni business, HBCU energy education, HBCU energy firms, HBCU entrepreneurship, HBCU venture funding, HBCUs and capital access, minority-owned renewables, oil-rich states and inequality, renewable energy HBCU, solar startups Black founders, Volt Energy HBCU

Category Archives: Business

Virginia Union University’s Keller Williams Partnership Exposes HBCU’s Fundamental Misunderstanding of Wealth Building

How India Can Teach HBCUs And African America To Build Its Own Silicon Valley

Sidebar: What HBCUs Can Build Now

Credit Card Rate Caps Could Deepen Financial Inequality for African American Households

Institutional Agriculture: How HBCUs and Black Banks Can Build a Farm Credit System of Our Own

With So Much Oil In HBCU States – Where Are HBCU Alumni Owned Energy Firms?

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