Tag Archives: african americans

2013’s 25 Highest Paid Hedge Fund Managers – No African Americans

By William A. Foster, IV

Wealth will set us fucking free, okay? ‘Cause wealth is empowering, wealth can uplift communities from poverty, okay? – Chris Rock

This past week Institutional Investor’s released its annual ‘Rich List’ of highest paid hedge fund managers of 2013. These 25 gentleman earned a combined $14.14 billion in 2012. Yes, that was billion with a B. Just to make the list a hedge fund manager had to make $200 million in the recorded fiscal year. The median earning according to Institutional Investor was $350 million. The king of the list was David Tepper, the hedge fund manager who once in 2011 accidentally left his ATM receipt (shown below) showing $100 million in his savings account, earned $2.2 billion. Yes, in one year David Tepper earned more money than what is in the combined coffers of all 100 plus HBCU endowments. Yet, the list in its twelve years has never had an African American present on the list.

TepperATM_receipt

What is a hedge fund? According to Investopedia, it is an aggressively managed portfolio of investments that uses advanced investment strategies such as leveraged, long, short and derivative positions in both domestic and international markets with the goal of generating high returns. Legally, hedge funds are most often set up as private investment partnerships that are open to a limited number of investors and require a very large initial minimum investment. Investments in hedge funds are illiquid as they often require investors keep their money in the fund for at least one year.

The minimum investment most hedge funds require varies between $500 000 to $1 million. More established hedge funds can have even higher minimums. Hedge fund managers are able to make a tremendous amount of money because of the industry unwritten rule called 2 and 20. This refers to hedge fund managers charging a 2 percent fee on investments in the hedge fund and receiving a 20 percent cut of all profits generated by the fund. To say this is a lucrative rule, one only needs to look at the list of earning by the top hedge fund managers. If a hedge fund gets 10 investors (individuals or institutions) to invest $1 million each to create a $10 million pool before any investments are even made the 2 percent rule has generated $200 000 in fees for the manager. Assuming the fund turns than $10 million into $110 million then the hedge fund manager would receive $20 million for a total of $20.2 million in earnings. As long as the hedge fund produces its promised returns then investors will continue to pour money into it.

African America’s top ten earners from 2012 were in the fields of sports and entertainment combing to earn approximately $700 million or an average of $70 million a piece. Meanwhile, the top ten earners for hedge fund managers over that same period earned a combined $10.1 billion or an average of $1 billion a piece. This means that the income gap that exist between African America exist even in the upper echelons. In this case, African America’s top ten earned $0.07 for every $1.00 European America’s top ten earned.

The reality that all of African America’s top earners are still represented by being labor of the sports and entertainment industry (minus Oprah Winfrey) continues to highlight some very disturbing social trends and economic miseducation of what really constitutes wealth and power. Hedge fund managers not only control their own wealth but often the wealth of families, other wealthy individuals, institutions (like college endowments), and the ability to dictate the actions and operations of entire companies. If they miss a proverbial “shot” it can wipe out entire communities and families. Therefore, they are afforded a great deal of power within the realms of finance and society. On the other hand if LeBron James misses the game winning shot in the 7th game of the NBA championship its impact is minute at best.

It is time we become more strategic and provocative about our placement of our intellectual capital versus physical capital. We promote education and intellectual development as our upliftment and yet at the apex we continue to see those who will entertain in different forms and fashions reaping rewards whose ripple in terms of power for the African American community is miniscule at best. If there is an assumption that we are closing the gap it is because we would rather put on rose colored glasses than look at the reality – one man makes 300 percent of our ten highest earners. Unfortunately, even roses have thorns.

Student Debt Profile By Conference (School By School) – The CIAA

CIAA

Bowie State University

Average debt of graduates, 2011 – $24 291

Proportion of graduates with debt, 2011 – 76%

Nonfederal debt, % of total debt of graduates, 2011 – 9%

2010-11 Pell Grant recipients – 52%

Elizabeth City State University

Average debt of graduates, 2011 – $3 846

Proportion of graduates with debt, 2011 – 44%

Nonfederal debt, % of total debt of graduates, 2011 – 49%

2010-11 Pell Grant recipients – 66%

Fayetteville State University

Average debt of graduates, 2011 – N/A

Proportion of graduates with debt, 2011 – N/A

Nonfederal debt, % of total debt of graduates, 2011 – N/A

2010-11 Pell Grant recipients – 72%

Johnson C. Smith University

Average debt of graduates, 2011 – $46 673

Proportion of graduates with debt, 2011 – 100%

Nonfederal debt, % of total debt of graduates, 2011 – 5%

2010-11 Pell Grant recipients – 58%

Lincoln (PA) University

Average debt of graduates, 2011 – N/A

Proportion of graduates with debt, 2011 – N/A

Nonfederal debt, % of total debt of graduates, 2011 – N/A

2010-11 Pell Grant recipients – 64%

Livingstone College

Average debt of graduates, 2011 – N/A

Proportion of graduates with debt, 2011 – N/A

Nonfederal debt, % of total debt of graduates, 2011 – N/A

2010-11 Pell Grant recipients – 84%

Saint Augustine’s University

Average debt of graduates, 2011 – $12 652

Proportion of graduates with debt, 2011 – 93%

Nonfederal debt, % of total debt of graduates, 2011 – 8%

2010-11 Pell Grant recipients – 74%

Shaw University

Average debt of graduates, 2011 – N/A

Proportion of graduates with debt, 2011 – N/A

Nonfederal debt, % of total debt of graduates, 2011 – N/A

2010-11 Pell Grant recipients – 75%

Virginia State University

Average debt of graduates, 2011 – $28 250

Proportion of graduates with debt, 2011 – 90%

Nonfederal debt, % of total debt of graduates, 2011 – 24%

2010-11 Pell Grant recipients – 71%

Virginia Union University

Average debt of graduates, 2011 – N/A

Proportion of graduates with debt, 2011 – N/A

Nonfederal debt, % of total debt of graduates, 2011 – N/A

2010-11 Pell Grant recipients – 67%

Winston-Salem State University

Average debt of graduates, 2011 – N/A

Proportion of graduates with debt, 2011 – N/A

Nonfederal debt, % of total debt of graduates, 2011 – N/A

2010-11 Pell Grant recipients – 53%

Source: The Project on Student Debt

The HBCUpreneur Corner – North Carolina A&T’s Asaad Thorne & Urban Argyle, LLC

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Name: Mr. Asaad Thorne

Alma Mater: North Carolina A&T State University

Business Name & Description: Urban Argyle, LLC. We use clothing as a innovative means to create socially conscious statements.

What year did you found your company? January of 2009

What was the most exciting and/or fearful moment during your HBCUpreneur career? The most exciting moments were my first time launching a blog and online store. Oh, and also seeing something I created on national television. The most fearful moments come ironically when I get closer to my goals. It’s scary sometimes when you’re about to get something you’ve been working for.

What made you want to start your own company? I wanted to start my own company because I wanted to create and develop something that was at one time just completely an idea. The fact that something as small as a thought can undoubtedly become a reality (no matter what) is crazy to me. To me, entrepreneurship is truly the strongest way to create anything there is you’d like to create.

Who was the most influential person/people for you during your time in college? The most influential people to me was a close friend who was also SGA President at the time who consistently broke barriers. Terrence J is a huge inspiration to me because our backgrounds are similar with high school, college, and NCA&T SGA. Lastly would be my two very close friends Adrianne Stevens (pictured below) and Alexandria Pierce. During a hard time they let me live with them and monopolize their laptops to actually create my business. They believed in me when I didn’t believe in myself and were the reason I could start a business eventhough I was a homeless student with no internet. They were murdered two years ago but I always make it a point when I feel tired or lazy to honor the faith they had in me.

dotadrian

How do you handle complex problems? The worst thing you can do is shut down. I start with reminding myself that this situation is going to be here whether I choose to deal with it now or later. Then if it’s really bad I consider the worst way it could potentially turn out and accept it. Then, I think of the best potential way it could turn out and make it my reality. Then it’s just a matter of breaking it down to simpler parts until it starts to make sense.

What is something you wish you had known prior to starting your company? I wish that I’d known that there is no secret formula to running a business. Every “best” business practice can be challenged and proven to be a “worst” business practice. I spent a lot of time looking for the “secret” to entrepreneurship but it’s nothing more than staying committed to a purpose until it’s sought through. There is no way possible to know exactly the twists, turns, and opportunities that come your way so it’s best to make a couple broad, short-term goals and many, many, many small and basic short term goals as you go along.

What do you believe HBCUs can do to spur more innovation and entrepreneurship while their students are in school either as undergraduate or graduate students? I believe that internships with alumni who are entrepreneurs would be genius. In the fashion industry, there are many unpaid interns who pay their dues as a means of respect to grow. If HBCUs could mirror this concept, alumni would have access to more resources in support and undergrads would get experience so both would grow. Experience is the only way to grow in entrepreneurship because it is more competitive than any other field.

How do you deal with rejection? I find another way. One of the first things you have to understand is that business is not a game and it’s not personal. It’s business. If you haven’t been rejected then you haven’t done anything. In fact entrepreneurship is all about finding a “way around the no’s”.

When you have down time how do you like to spend it? Trying to shut my brain down. It’s hard not to think or work on things sometimes but you also don’t want to burn out. It all depends on working styles. Sometimes I lock myself away for a little while, maybe a weekend and just work. But if I do I make sure to take a few days off after. Life would be great if I could spread my productivity a little more evenly but I haven’t mastered that yet.

What was your most memorable HBCU memory? I organized a commemorative march using clothing to fund raise for the International Civil Rights Museum in Greensboro, NC. Hundreds of people came and there was news coverage. That’s when I realized any idea is possible.

In leaving is there any advice you have for budding HBCUpreneurs? The best piece of advice I’ve been given by one of my mentors is to “Grow slowly”. Sometimes we want to do a million different things because we see the long term goal we want but growing extremely fast is almost always followed with falling completely fast. It takes time, dedication, and commitment to start to see lasting results. Think of it a seed planted. No matter if I water it 5 times a day or 50 times a day there’s still some growth that has to happen completely independent of my influence.

But most importantly, enjoy the small victories. Celebrate everything, it keeps the motivation going. Be able to say “Made a million dollars today!” with the same level of excitement as saying “Responded to an email! Woo!”

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Visit Urban Argyle’s flagship Proud Product at http://www.proudproduct.com or head straight to their store at http://proudhbcuproduct.bigcartel.com/  to see the latest offerings.

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The Uninsured Rates By HBCU State

They always say when America catches cold, African America catches pneumonia. So while the uninsured rate nationally for all Americans is 15.6 percent, the percentage of African America uninsured is approximately 20 percent. An almost 30 percent premium over the national average. The rates below are the overall state’s uninsured and not specifically for African Americans. However, in parentheses we have put the rate for a 30 percent increase to potentially show what the African American uninsured rate could be. It should be noted that this number is not definitive as it is just based on using the national numbers as an estimating base.

hbcustates

State      Uninsured Rate   (Estimated African American Uninsured Rate)

Massachusetts – 3.3% (4.3%)

Washington D.C. – 8.4% (11%)

Delaware – 9.9% (13%)

Pennsylvania – 10.8% (14%)

New York – 12.1% (15.7%)

Michigan – 12.2% (15.9%)

Alabama – 12.9% (16.8%)

Tennessee – 13.1% (17%)

Virginia – 13.2% (17.2%)

Ohio – 13.4% (17.4%)

Maryland – 13.8% (18%)

Kentucky – 14.2% (18.5%)

Illinois – 14.6% (19%)

Missouri – 14.6% (19%)

Mississippi – 16% (20.8%)

North Carolina – 16.1% (21%)

Oklahoma – 16.8% (21.9%)

Arkansas – 17.3% (22.5%)

South Carolina – 18.7% (24.3%)

Georgia – 19% (24.7%)

Florida – 19.8% (25.8%)

Louisiana – 20.5% (26.7%)

Texas – 23.7% (30.8%)

Notes:

Overall 14 out of 24  mainland states and territory where HBCUs are located fall below the national uninsured rate.

Only 4 out of 24 mainland states and territory where HBCUs are located have the estimated African American uninsured rate below the national average.

The average overall uninsured rate for the 24 mainland states and territory where HBCUs are located is 14.8 percent while the median is 14.4 percent.

The average estimated African American uninsured rate for the 24 mainland states and territory where HBCUs are located is 19.2 percent while the median is 18.8 percent.

Source: Bloomberg Visual Data (December 2012); States used as designated by HBCUs recognized by HBCU Endowment Foundation