Tag Archives: Black institutional wealth

The “Real World” Myth: How Sending African American Children to PWIs Undermines African American Institutional Power

“When you control a man’s thinking you do not have to worry about his actions. He will find his ‘proper place’ and will stay in it. You do not need to send him to the back door. He will go without being told; in fact, if there is no back door, he will cut one for his special benefit.”
Carter G. Woodson, The Mis-Education of the Negro

For generations, African American families have been told a myth that has become so pervasive it often passes without challenge: the idea that sending their children to predominantly white institutions (PWIs) of higher education better prepares them for the “real world.” On its surface, the reasoning sounds practical. Parents believe that if their child learns how to navigate white spaces, acquires the habits and codes of those spaces, and builds networks with white peers, they will be more successful in corporate America and society at large. It is a calculation born of centuries of survival in a society structured against African Americans.

But this calculation, when examined deeply, does not hold up to scrutiny. Instead of preparing African American students for the “real world,” the widespread preference for PWIs undermines the institutional power of African Americans and deprives HBCUs of the very human and financial capital they need to thrive.

The “real world” itself is not a fixed entity. It is not a monolith that African Americans must prepare to join on white terms. The real world is what a group of people make it. White Americans have defined their world and fortified it through their institutions such as universities, banks, hospitals, corporations, and foundations. Asian Americans, Jewish Americans, and other groups have done similarly, leveraging their educational and economic institutions to shape their reality. Yet, African America, too often, has internalized the belief that its institutions are insufficient, opting instead to send its brightest students and most valuable tuition dollars into the coffers of PWIs.

This is not simply a matter of personal choice. It is a collective decision with collective consequences. The more African American families buy into the “real world” myth, the weaker HBCUs become, and the less capable African America is of shaping its own real world.

The PWI Path and Its Assumptions

African American parents who choose PWIs for their children often do so with good intentions. They want their children to access elite resources, prestigious networks, and the perceived stamp of approval that comes with a degree from a PWI. They assume that because the U.S. labor market is majority white, exposure to that environment early on is critical to future success.

But these assumptions reveal several contradictions. White students do not consider attending an HBCU to balance their cultural experiences. They do not think, “I’ve had too much whiteness; I need a more balanced education.” Instead, they progress from a PWI undergraduate degree to a PWI graduate school, then into PWI-dominated corporate and institutional spaces. Their cultural immersion is never questioned, because their institutions define normalcy.

Meanwhile, African Americans alone have been conditioned to believe that too much African American immersion is dangerous, insular, or unrepresentative of the “real world.” The irony is sharp: a student may attend an HBCU, which is itself a diverse universe of African American culture, class, geography, and ideology, and still be told they have not had enough “exposure.” Yet a white student who grows up in an all-white town, attends an all-white PWI, and joins all-white firms is never told they lack “diversity of experience.”

This asymmetry is not accidental. It is a reflection of who controls institutional narratives in America. African Americans who absorb the “real world” myth are effectively outsourcing their children’s futures to white institutions, all while their own institutions wither from neglect.

The Diversity Within HBCUs

Another overlooked dimension of this myth is the assumption that HBCUs are homogeneous, insular spaces. This could not be further from the truth. The African American experience itself is vast. It includes children of Caribbean immigrants, descendants of enslaved Africans, first-generation college students from rural Mississippi, affluent families from Washington, D.C., African students from Nigeria and Ghana, Afro-Latinx students from Puerto Rico and the Dominican Republic, and more.

To attend an HBCU is not to encounter “less” diversity; it is to engage with the broad spectrum of the African Diaspora in concentrated form. These institutions are living laboratories of cultural exchange, intellectual competition, and class interaction.

By contrast, a PWI often provides African American students with only a sliver of diversity: they are frequently tokenized, expected to represent their entire race, and shuffled into diversity programming that centers their marginalization. Their peers may never learn about African American life beyond stereotypes, because the institution itself was never designed to illuminate African American experiences.

Thus, the African American student at an HBCU receives not just an education, but an immersion in African American pluralism is a preparation for engaging the world on African American terms. The PWI student, meanwhile, often internalizes the idea that their presence is conditional, exceptional, or peripheral.

Institutional Power and the Capital Flight from HBCUs

Every African American student who chooses a PWI over an HBCU represents more than an individual choice. It is the redirection of tuition dollars, alumni loyalty, and future endowment contributions away from African American institutions.

Imagine if even half of the African American students currently enrolled at PWIs redirected themselves to HBCUs. The financial impact would be transformative. Endowments would grow, faculty recruitment would expand, research capacity would increase, and the prestige of HBCUs would rise proportionally. These gains would compound over decades, creating a feedback loop of institutional strength.

Instead, what we have is a leakage of capital and talent into institutions that do not prioritize African American empowerment. PWIs benefit from African American enrollment statistics, which they parade as evidence of diversity, while offering little in terms of institutional reciprocity. They gain the reputational boost, while HBCUs lose the enrollment and financial stability they desperately need.

The result is predictable: HBCUs remain underfunded, under-endowed, and under-appreciated, not because they lack quality, but because too many African American families believe the myth that their children will be better off elsewhere.

The Real World Is What We Make It

The central flaw in the “real world” argument is the assumption that African Americans must adapt to a world built by others rather than shape their own. The real world is not an objective standard but it is the result of group will, institutional building, and cultural reinforcement.

White Americans shaped their “real world” through the sustained investment in Harvard, Yale, Princeton, and thousands of other institutions that center their history, culture, and power. Jewish Americans created their “real world” through a network of universities, foundations, and cultural centers that prioritize their collective survival. Asian Americans are building their own “real world” through business networks, educational pipelines, and capital flows that stretch across the Pacific.

If African Americans accept the premise that their children must be trained in white institutions to succeed, they have already conceded that they cannot or will not shape their own real world. They have abandoned the project of institutional power in favor of individual adaptation. This is not preparation; it is surrender.

Psychological Implications: Internalizing Inferiority

Beyond the economic impact, the myth has deep psychological consequences. African American students raised on the belief that HBCUs are not “the real world” internalize a subtle but corrosive idea: that their own culture is insufficient. They may carry degrees from elite PWIs, but the cost is often an alienation from African American institutional life.

The psychological message is clear—white spaces are the pinnacle of preparation, while African American spaces are something to escape. This creates a generational feedback loop where each successive cohort of African American parents pushes harder for PWIs, believing they are giving their children an advantage, while in reality they are weakening the very institutions that could make African America self-sufficient.

It also distorts identity. An African American child who grows up believing they must leave their community to succeed will often view their success as individual rather than collective. They may become comfortable being the “only one in the room,” rather than building the rooms where African Americans are not tokens but owners.

The Comparative Case: No Other Group Thinks This Way

No other racial or ethnic group in America sends its children away from its own institutions to gain “real world” experience. White families do not think Harvard students lack preparation because they have spent too much time around other white students. Jewish families do not believe their children need to avoid Jewish institutions to be competitive. Chinese Americans do not view Chinese language schools or cultural institutions as a liability to their children’s preparation.

It is only African Americans who accept this self-defeating logic. This uniqueness underscores the lingering effects of centuries of racial conditioning. From slavery to Jim Crow to modern structural racism, African Americans have been taught that their own institutions are inferior. The “real world” myth is simply the modernized version of this lesson.

By contrast, when other groups send their children to institutions, they do so with the understanding that these institutions will strengthen their cultural identity while equipping them to engage broader society on their own terms. For African Americans, the task must be the same: build HBCUs into the kind of institutions that define, rather than defer to, the real world.

Rethinking the “Preparation” Narrative

If the goal of higher education is preparation, then the question is: preparation for what? For African Americans, preparation should not simply mean being employable in someone else’s institution. It should mean being capable of building, leading, and sustaining African American institutions.

An HBCU graduate is not less prepared for corporate America than a PWI graduate; in many cases, they are more resilient, more culturally grounded, and more aware of systemic barriers. The difference is that the HBCU graduate, if supported by their community, is positioned to reinvest in African American institutional life.

The narrative that PWIs uniquely prepare African Americans for the “real world” ignores the fact that many HBCU alumni have gone on to excel in every imaginable field from politics, science, business, culture while also strengthening the institutions of African America. The preparation HBCUs offer is not narrow; it is holistic, rooted in both academic rigor and cultural affirmation.

A Call to Reclaim Institutional Power

For African Americans to continue believing in the “real world” myth is to ensure that the next century looks much like the last: individual success stories amid collective institutional weakness. To break this cycle, African American families must reorient their thinking.

Sending a child to an HBCU is not a limitation; it is an investment in collective power. It is a statement that African Americans will not only participate in the real world but will define it. It is a recognition that every tuition dollar, every alumni donation, and every student enrollment strengthens the institutional backbone of African America.

The time has come to retire the myth once and for all. The real world is not something African Americans must be prepared for by others. It is something African Americans must build for themselves, through the strengthening of HBCUs and the rejection of narratives that undermine them.

Until that shift happens, African America will remain trapped in a paradox: sending its children to PWIs in search of preparation, only to find that the institutions that could truly empower them are being starved of the very resources they need.

The “real world” is not out there waiting. It is in our hands to create.

 Disclaimer: This article was assisted by ChatGPT.

While Howard Is Chasing Harvard, What Public HBCUs Are Chasing UTIMCO?

“I make no apology for the love of competition.” – John Harbaugh

In the world of higher education finance, few numbers turn heads quite like endowment size. It is the ultimate scoreboard for institutional power—a metric that signals not only a university’s wealth but also its capacity to shape research, drive innovation, support students, and influence national policy. In this rarefied air, Howard University has made history, becoming the first Historically Black College or University (HBCU) to surpass the $1 billion endowment mark. According to HBCU Money’s 2024 rankings, Howard’s endowment now stands at $1.03 billion.

Spelman College, long regarded as Howard’s fiercest private competitor, received a record-setting $100 million donation in 2023. Yet even with that windfall, its endowment reached $506.7 million—leaving it more than $500 million behind Howard. Nevertheless, Spelman’s donor base remains one of the strongest in Black higher education, and it may still overtake Howard in the race to $2 billion. But the $1 billion baton has already been passed.

If Howard is chasing Harvard, and Spelman is setting its sights on Yale, then who among public HBCUs dares to chase the Goliath of public university endowments—UTIMCO?

The Silent Behemoth in Texas

UTIMCO—the University of Texas/Texas A&M Investment Management Company—is not just large; it is colossal. As of 2024, UTIMCO manages a staggering $64.3 billion in assets across the University of Texas and Texas A&M university systems. That figure is nearly $15 billion more than Harvard’s own endowment and more than three times the size of the second-largest public university endowment at the University of Michigan.

This financial empire is largely invisible to the public eye. Few outside of elite Texas financial and political circles are even aware of UTIMCO’s existence, let alone its scale. It quietly funds a wide spectrum of research, real estate development, and private equity plays that influence state and national agendas.

If an HBCU—or group of HBCUs—is ever to rival that level of public endowment control, it will not happen by accident. It must be built. And it will most likely be built collectively.

HBCUs and the Endowment Gap

The endowment disparity between HBCUs and Predominantly White Institutions (PWIs) has been well-documented. HBCUs represent around 3% of America’s colleges, yet account for less than 1% of total U.S. endowment wealth. According to a McKinsey report, HBCUs would need $12.5 billion in incremental funding to achieve endowment parity with similarly sized PWIs.

While private HBCUs like Howard and Spelman appear to be making some headway, public HBCUs remain largely behind. Most of them are tethered to state systems that have historically underfunded them and which rarely—if ever—extend the full benefits of their system-wide endowment strategies.

Consider the University of North Carolina System. It includes North Carolina A&T, the largest HBCU by enrollment, and North Carolina Central University. Yet both institutions have endowments under $200 million. Meanwhile, UNC Chapel Hill boasts an endowment exceeding $5.4 billion. Similarly, Florida A&M University has an endowment of less than $200 million, while the University of Florida’s soars above $2 billion.

The Case for a Public HBCU Endowment Challenger

In identifying a public HBCU capable of mounting a challenge to UTIMCO’s financial supremacy, the most promising strategy does not lie in the strength of one institution—but in the collective power of several. States that are home to multiple public HBCUs present the most viable path to establishing a unified, independently managed investment entity that can leverage scale, pooled capital, and institutional collaboration.

Virginia, Alabama, Georgia, North Carolina, South Carolina, and Mississippi all house two or more public HBCUs, each with proud legacies and strategic regional influence. A coordinated financial framework across these schools could form the foundation of a “Black UTIMCO”—a professionally managed, state-based consortium endowment capable of rivaling small PWI systems in both return and influence.

The most likely candidates must share a few key characteristics:

  1. State-Level Endowment Consortium Model – States with two or more public HBCUs, such as Virginia (Virginia State, Norfolk State), Georgia (Albany State, Fort Valley State, Savannah State), or Alabama (Alabama A&M, Alabama State), are uniquely positioned to pioneer a collective endowment strategy. Rather than relying on marginal support from broader university systems, these HBCUs could form a joint investment vehicle modeled on UTIMCO—pooling their endowments under a professionally managed, independent investment company. Such a fund would enable economies of scale, competitive asset management, and unified long-term planning, boosting their ability to generate investment alpha and philanthropic leverage.
  2. Flagship Status Among HBCUs – Institutions with strong alumni networks, national reputations, and federal research capabilities are better positioned to attract major philanthropy.
  3. Strategic Location – HBCUs located in fast-growing economic zones can leverage regional corporate ties for private partnerships.

However, creating such a financial architecture is not purely a technical endeavor. It is inherently political—and often fraught with social resistance.

The Political Geography of Resistance

Many of the states that host multiple public HBCUs are governed by conservative legislatures and state boards of regents that have long resisted equitable funding for Black institutions. Despite proclamations about diversity, equity, and inclusion, these power structures often withhold support from Black-led entities that could challenge traditional hierarchies.

  • Alabama, with Alabama State and Alabama A&M, underfunded its HBCUs by over $527 million between 1987 and 2020, according to the U.S. Department of Education.
  • Georgia’s consolidation of HBCUs like Albany State into broader system structures has often diluted their financial and governance autonomy.
  • Mississippi has repeatedly neglected basic infrastructure and funding needs at its three public HBCUs—Jackson State, Alcorn State, and Mississippi Valley State—despite allocating surpluses elsewhere. It is also no secret that Mississippi has purposely constructed a singular board of trustees for all of its public higher education institutions across the state with Ole Miss and Mississippi State unabashedly dominating the board.

Even in Virginia, perceived as more moderate, a move by Virginia State University and Norfolk State to pool their endowments might be seen as too bold a play in a state that still subtly resists Black institutional consolidation.

Social Impediments and Institutional Fragmentation

Beyond politics, there are intra-HBCU dynamics that complicate collaboration. These institutions have historically been forced to compete for scraps, which can breed a zero-sum mentality. Trustees, alumni, and administrations often prefer complete local control over modest assets rather than shared governance over substantial ones.

Convincing institutions to pool their endowments requires cultural alignment and a long-term vision of shared prosperity. Donors, too, may resist giving to multi-institutional funds, preferring the emotional appeal of a singular alma mater.

Nonetheless, this mindset must change. The math is clear: five public HBCUs each contributing $100 million can produce a $500 million investment base. That scale opens doors to private equity, hedge funds, and other vehicles that outperform the conservative allocations typically used by smaller institutional portfolios.

Institutions Poised for Leadership

  • North Carolina A&T State University, with an endowment of $201.9 million, remains the largest public HBCU endowment. With deep ties to tech and defense industries, it has both alumni momentum and industry leverage.
  • Florida A&M University, despite setbacks surrounding its pledged $237 million donation, has an official endowment of $124.1 million and stands to benefit immensely from partnership with institutions like Bethune-Cookman or Edward Waters.
  • Virginia State University and Norfolk State University, with $96.5 million and $88.2 million respectively, could combine to form the financial cornerstone of a Virginia HBCU Investment Company—managing nearly $185 million in assets at inception.

The Need for a “Black UTIMCO”

Rather than wait for state systems to share the wealth equitably, some in the HBCU policy space are advocating for the creation of a consortium endowment fund — a kind of “Black UTIMCO.” This collective endowment manager would pool assets from willing HBCUs, allowing them to negotiate better investment terms, lower fees, and generate alpha through scale.

Such an initiative would require governance innovation, donor transparency, and trust between institutions that are often underfunded and overburdened. But it may be the only viable path forward for public HBCUs to compete against mega-managers like UTIMCO, MITIMCo, or the Yale Investments Office.

A $5 billion consortium fund, even divided across 25 HBCUs, would be transformational. It could fund scholarships, capital improvements, faculty chairs, and technology upgrades, while giving HBCUs the financial leverage to attract major federal research grants.

A New Competitive Mindset

In American higher education, the metaphorical arms race is very real. Endowments are the stockpiles. Harvard and Yale are the gold standard in the private arena. UTIMCO is the titan in the public sector. And HBCUs, despite their contributions to Black excellence, continue to be locked out of the upper tier.

John Harbaugh’s quote about competition resonates because it points to a deeper truth: love of competition does not require parity at the outset, only the will to chase. Howard is in the final lap toward $1 billion, setting a new bar for Black institutional capital. Spelman may outdistance them on the next lap to $2 billion. But in the public sphere, the silence is deafening.

Where is the public HBCU that dares to dream of beating Michigan, surpassing UNC, or even challenging UTIMCO?

The Race Begins with Vision

Howard is chasing Harvard. Spelman is perhaps chasing Yale.

But no single public HBCU can chase UTIMCO. The scale is too vast, the machinery too entrenched, and the rules too uneven.

What public HBCUs can do, however, is combine. They can look across their borders, past their rivals, and toward a shared future. They can imagine a world where collective African American endowment power reshapes not just education, but the broader economy and policy landscape.

It is not a failure of ambition that no public HBCU has reached $1 billion. It is a failure of coordination and imagination.

The first African American UTIMCO will not be built by a single school. It will be built by a desire for compeition. A desire to win.

Debt Fit for a Queen (and Her King): Why Beyoncé and Jay-Z’s $110 Million Mortgage Is a Lesson in Black Wealth Strategy

“The wealthy don’t fear debt they master it. While others pay to own, they borrow to control.” — HBCU Money

In the hills of Bel Air, where the gates are high and the price of privacy even higher, a royal couple reigns not with crowns or thrones, but with compound interest, limited liability companies, and a mastery of capital structuring. This month, Beyoncé and Jay-Z made headlines again, not for a new album or tour, but for a second mortgage. The couple whose combined net worth now exceeds $3 billion, per Forbes secured an additional $57.8 million mortgage on their $88 million Bel Air estate. This raises their total mortgage debt on the property to $110.6 million. For many, it triggered confusion: Why would billionaires take out debt especially this much? They own the intellectual property rights to chart-topping albums, entire music catalogs, clothing lines, venture funds, and streaming services. They’re not short on liquidity. But for those fluent in institutional wealth-building, the move is textbook. It’s what banks do. What private equity does. What families like the Rockefellers, Rothschilds, and yes, now the Carters, do: they leverage good debt to expand their control over assets, preserve liquidity, and legally reduce taxes. As the headlines obsess over the couple’s $637,244 monthly burn rate including mortgage and property taxes we must step back and understand the real play at work.

The Structure of Power: Debt as a Wealth Instrument

There are two kinds of debt in America, debt you drown in, and debt you climb on. The former is predatory and suffocating: payday loans, credit card interest, subprime mortgages. The latter is engineered and liberating: investment real estate, operating capital, bridge financing. This second category, good debt is what powers Wall Street, Silicon Valley, and, increasingly, the portfolios of Black billionaires. When Beyoncé and Jay-Z financed their Bel Air estate rather than pay in cash, it wasn’t a lack of funds it was a maximization of strategy. With interest rates still historically low by long-term standards, the effective cost of borrowing is cheaper than the opportunity cost of deploying equity elsewhere. That $110 million in borrowed capital is likely earning multiples elsewhere in touring infrastructure, private equity ventures, tech startups, and, of course, real estate. The Carter empire does not rely on liquidating assets to make acquisitions. It builds on leverage, like any institution should.

Cash Is King, Debt Is the Horse It Rides

Jay-Z once rapped, “I’m not a businessman. I’m a business, man.” And that business understands that cash flow is oxygen. In a high-inflation, high-yield environment, holding liquidity is more valuable than owning a paid-off house in Bel Air. Let’s model it simply:

  • Suppose the couple borrowed $110 million at a 3.5% interest rate.
  • The annual cost is approximately $3.85 million.
  • That same $110 million deployed into touring, film production, or venture investments yielding 10% generates $11 million annually.

Net result? Over $7 million in arbitrage.

This is how institutions think. Not in terms of how much they “own,” but in how much capital they control and multiply. African American families and institutions should take note: Being debt-free is not synonymous with being economically powerful. Control, not ownership alone, is the more sophisticated metric of power.

The Bel Air Property: Trophy or Tool?

It’s tempting to dismiss the Bel Air estate as just another status symbol, a personal flex. But that’s the wrong lens.

For the Carters, real estate like music catalogs, business equity, and IP is a balance sheet line item. This home, aside from its lifestyle function, serves several institutional purposes:

  1. Collateralization – The home is a high-value, appreciating asset. It anchors future lending.
  2. Credit Enhancement – With reliable payment performance, it increases the couple’s access to cheap capital.
  3. Tax Optimization – Interest payments on a mortgage of this type can be partially deducted, even under current tax caps.

Moreover, the couple reportedly pays $100,343 monthly in property taxes, more than the annual income of the median U.S. household. But again, context matters. Their global income and asset base far outpace such obligations, and that property tax provides further tax deduction possibilities depending on structure.

A Note to the Emerging Class: Institutional Thinking Required

The divide in America today is less about income and more about how wealth thinks. Many African American households are still taught to see debt as something to eliminate completely often because of the trauma associated with its misuse. The wealth class, by contrast, uses debt as a financial tool.

The Carters didn’t get here by mistake. Their trajectory offers lessons that should be taught in HBCU finance classrooms and African American family wealth summits alike:

  • Leverage is not a vice if it is structured.
  • A mortgage is not debt when the return exceeds the cost.
  • Liquidity is more powerful than ownership in times of economic opportunity.
  • Institutions survive because they think beyond the personal.

This is especially important for HBCU alumni and African American families looking to build dynastic wealth. Too often, debt is only associated with student loans and credit cards. Rarely is it discussed as an accelerant for asset acquisition, tax minimization, or capital scaling.

Building the Empire: What the Rest of Us Can Learn

You don’t need a Bel Air zip code to think like an institution. The Carter model can be scaled:

  1. Buy Investment Property
    Use mortgage debt to buy a duplex, triplex, or quadplex where tenants cover your mortgage and generate passive income.
  2. Preserve Your Capital
    Avoid putting 100% down on assets. Leverage 20–30% and maintain the rest for emergencies or investments.
  3. Learn the Tax Code
    Understand how to deduct interest, depreciate properties, and structure your finances to reduce liability legally.
  4. Think Generationally
    Set up trusts, LLCs, and estate plans. Don’t just buy for today—structure for tomorrow.
  5. Teach the Next Generation
    Share strategies at the dinner table. Incorporate wealth-building into family conversations and HBCU alumni networks.

From Debt-Averse to Debt-Aware: A Cultural Pivot

For African America, there must be a shift from being debt-averse to being debt-aware. Not reckless, but informed. Not afraid, but empowered. Beyoncé and Jay-Z’s move may make for juicy tabloid fodder, but the real story is about capital strategy. With every refinance, with every debt restructuring, they’re deepening their institutional footprint. We often praise their performances, their music, their style. But perhaps we should spend more time studying their moves not just on stage, but on paper. Their empire isn’t built on vibes it’s built on vehicles, vision, and valuation strategy.

The Carter Codex

The narrative shouldn’t be, “Beyoncé and Jay-Z are spending $637,000 a month.” It should be, “Beyoncé and Jay-Z have leveraged a property to unlock hundreds of millions in investment capital while maintaining their lifestyle and optimizing their taxes.” That’s the story HBCU students in finance departments should be analyzing. That’s the story African American financial advisors should be breaking down. That’s the story Black families gathering for holiday dinners should be dissecting. Because wealth isn’t what you show it’s what you can withstand, what you can structure, and what you can scale. In a country that often denies African America the full benefits of capitalism, the Carter family is rewriting the playbook. Not with debt as a burden. But with debt as a bridge.

Disclaimer: This article was assisted by ChatGPT.