Tag Archives: HBCU

Will Morehouse’s 2019 Class Be The Greatest Donors In HBCU History? After Robert F. Smith’s Donation, They Better Be


“The results of philanthropy are always beyond calculation.” – Mary R. Beard

By now we have all heard the breaking news, on May 19th in the year of our lord 2019, Robert F. Smith, an angel of God descended upon the sacred grounds of the AUC in Atlanta, Georgia and in his commencement speech to an estimated 400 Morehouse College graduates also pledged to ensure that his family would pay off each and every one of their student loans. The grant is estimated to be a gift valued at $40 million making it the second largest donation to the HBCU community, still trailing Bill and Camille Cosby’s gift of $20 million in 1988 to Spelman College, which adjusted for inflation is valued at $43.2 million today. Stating the obvious, there still has yet to be a gift of $100 million or more in HBCU history, while HWCUs received 13 gifts of $100 million or more in 2018 alone. This is not to take away at all from Mr. Smith’s gift as the reality that the return on investment to HBCUs  on gifts of $10 million or more are often worth a multiplier effect because of the size of our schools, how starved we are for donations of any sort especially major ones, and lastly our schools often being so adept at doing more with less that when we get more it often feels like it maybe overwhelming (it is not, please feel free to give any HBCU $100 million, seriously). But what will this gift mean to the HBCU landscape for the coming generation?

You hear it all the time among recent HBCU graduates and alumni when asked what are some of their primary reasons for not giving back. At the top of the list tends to pertain to the burden of their student loan debt. It is no secret that HBCU students bear a serious burden when it comes to student loan debt in comparison to their HWCU counterparts, especially those counterparts who attend an institution that is among the Top 50 in college endowments. In our 2016-2017 HBCU Graduate Student Loan Report, 86 percent of HBCU graduates finish with student loan debt at a median debt load of $34,131 versus 40 percent of Top 50 college endowment graduates who finish with student loan debt at a median debt load of $24,237. This is due to a mixture of factors, most notably HBCU endowments and familial wealth.

The top 30 college endowments in America control over 50 percent of the nation’s $500 billion college endowment value, while 100 plus HBCUs control less than 1 percent. Combine this with the African/European American wealth gap not moving for 50 years, which according to a Forbes article, “African-Americans had a median wealth of $13,460 in 2016 or only 9.5% of the median wealth of $142,180 of whites”. These major pinpoints make it extremely difficult for HBCU graduates to reduce their student debt loads while matriculating and therefore build wealth after college. The result becomes they are either prolonged before they can become donors or never do and the sword of educated poverty is what they and our institutions fall upon decade after decade with no end in sight.

Morehouse College Class of 2019 though sits in a special position to change the trajectory of not only Morehouse College’s endowment, which we have argued has grossly under performed compared with the likes of Hampton, Spelman, and Howard in its fundraising efforts. This despite the help from the likes of another billionaire, Oprah Winfrey, who herself as put hundreds of Morehouse Men through college as well. To what extent her giving to Morehouse has reduced student loan debt for graduates is unknown, but knowing Ms. Winfrey’s giving history, it has been formidable. However, the Class of 2019 may prove to be worth a longitudinal study in HBCU philanthropy. What happens when an HBCU graduate finishes with little or in this case no student loan debt? Do they see it as an opportunity to be more active donors back to their institution and to other HBCUs. Will their donor rate be higher than other classes? It is no secret that despite the Morehouse pride, the alumni giving rate at the institution has been underwhelming at best. If these 400 young men properly build their wealth and give back to Morehouse and other HBCUs, then have we potentially unlocked one of the keys to making our institutions sustainable? We have also long argued what it would look like if African Americans supported HBCUs in a major way, even if they did not attend an HBCU. Giving because a strong African American institution of any sort is a reflection of themselves in society and that our fates are always intertwined. That a people are ultimately only as strong as the institutions that represent their interest.

However, to do what Robert F. Smith did on an institutional level is going to require more than just one billionaire (or even two), but it is definitely a pivotal step in the right direction – hopefully. After all, it has been over three decades since a donation of this size for HBCUs. The lack of multimillion dollar gifts to HBCUs and African American educational institutions in general has been, continues to be, and is problematic systemically. For instance, if we extrapolated the notion of helping HBCU graduates be debt free, endowments at our institutions would have to be exponentially greater than what they are now. Howard University, Spelman College, and Hampton University, the three largest HBCU endowments, which have current endowments of $688 million, $389 million, and $285 million, respectively, would need endowments exceeding $6 billion, $1.7 billion, and $2.5 billion, respectively. In other words, they currently have a combined endowment value of $1.4 billion but need $10.2 billion, which is a margin of $8.8 billion, greater than Robert F. Smith and Oprah Winfrey’s wealth combined, an estimated $7.6 billion. This of course speaks nothing of and to the number of HBCUs who are hanging on for dear financial life and whose endowments if they even exist are paltry at best. Like many small and state colleges, lesser known HBCUs struggle to attract major donors, but the Morehouse 400 does/should know who they are and should take the vanguard in being integral over the next 50-60 years of ensuring that all HBCUs drink from the fountain of opportunity that they have been granted access too. These young men have a chance to alter the trajectory of the HBCU universe and we hope with this great opportunity they have been gifted that they also know comes a great responsibility. Will they become the greatest HBCU donors in HBCU history? Only time will tell.

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HBCU Money™ Turns 7 Years Old


By William A. Foster, IV

“Every great dream begins with a dreamer. Always remember, you have within you the strength, the patience, and the passion to reach for the stars to change the world.”

Seven years strong with so much more to do. The past two years have been a test of mettle for HBCU Money and HBCU journalism as a whole. As journalism and media as a whole are becoming an even more complicated business with much of larger media being purchased by a small class of people who can afford to pour resources into it without needing it to make any money, yet leveraging the benefits of shaping public opinion it leaves an industry in flux. This dynamic leaves many smaller imprints with less external resources in a precarious position. Making enough money to keep the doors open, grow, and still able to put some Ramen noodles on the table for our families.

HBCU media ownership has, is, and will continue to be a labor of love certainly, but if we want it to scale to the level of influence we need in our community we need to have real conversations about just how and what needs to happen for that scale to take place. The importance of HBCU owned media can not afford to have all chiefs and no warriors.

At HBCU Money, I am excited for some of the things ahead that have been in the works for quite a few years on the drawing board finally getting off the board. Unfortunately, some of it maybe the leap of faith more than the resources available. Seven years into this though, faith is certainly something never to take for granted. I thank everyone who has restored it when it has been shaken and filled up the bucket when it was running low. There are too many to name, but you are appreciated. It is my hope that HBCU Money can continue to be worthy of your support and faith.

 

A Patent Created Is A Million Earned: HBCUs Are Not Keeping Pace In The Intellectual Property Arms Race Among American Colleges


“Necessity…the mother of invention.” – Plato

How did David beat Goliath, then go on to become a “Goliath” himself? With a rock, pebble, or stone depending on who is telling the story. However, it is truly what that piece of Earth hurling towards his enemy from his cache represented that is often most lost in the story. After all, most stories in the Bible are parables and in this case, while David gets all of the glory, it was truly the slingshot that was the star. The slingshot represented an idea, ingenuity, and research all at the same time. It was a representation of how even the smallest solutions can tackle the biggest problems and for David, the riches represent what is awarded to those who dare go after them.

What is a patent? According to the definition provided by the World Intellectual Property Organization, “A patent is an exclusive right granted for an invention, which is a product or a process that provides, in general, a new way of doing something, or offers a new technical solution to a problem. To get a patent, technical information about the invention must be disclosed to the public in a patent application.”

From 1969 to 2012, the U.S. Patent & Trademark Office granted 75,353 to America’s colleges and universities. However, during that same period HBCUs were granted an apathetic 101 patents, an amount less than one percent (0.13% to be exact) is a telling story of just one of the factors that hold back HBCUs financial sustainability. In the past twenty years alone since the turn of the 21st century, patents to colleges and universities have increased from 1,307 to 5,898, an almost five fold increase. In the same time period, the value of the revenue from those patents has also seen a meteoric rise to the tune of a 1,700 percent increase in value from $130 million annually to a staggering $2.2 billion annually. This does not even factor in the societal relevance that these institutions beget as a result. Can you imagine the financial and social impact that comes with being the college who invented the seat belt (Cornell University) or an even more well known invention, Gatorade (University of Florida)? The latter has earned the University of Florida over $1 billion in royalties alone. Even more to the point of colleges and universities profiting handsomely from intellectual property, according to an article in IP Watchdog in 2017, “a judge ordered Apple to pay the University of Wisconsin $506 million for infringing one of its tech patents. Last year, Carnegie-Mellon University won $750 million in a patent infringement lawsuit against Marvell Technology Group.” Those two settlements alone are worth fifty percent of all HBCU endowments combined. Needless to say, this is an arena that HBCUs need to make inroads into if survival and sustainability are long-term goals for our institutions.

PATENTS BY HBCU (1969-2012)

  1. Howard University – 18
  2. Morehouse School of Medicine – 17
  3. Florida A&M University – 16
  4. North Carolina A&T State University – 12
  5. Hampton University – 10
  6. Spelman College – 6
  7. Jackson State University – 4
  8. North Carolina Central University – 4
  9. Meharry Medical College – 3
  10. Tuskegee University – 2
  11. Alabama A&M University – 1
  12. Alabama A&M University Institute – 1
  13. Alcorn State University – 1
  14. Charles R. Drew University of Medicine – 1
  15. Claflin University – 1
  16. Delaware State University Foundation – 1
  17. Fort Valley State College – 1
  18. Shaw University – 1
  19. Virginia State University – 1
  20. Bowie State University – 1*

For all of the creativity that our culture has and exist on our campuses from faculty to students and more, there is little if any at times from administrations and alumni when it comes to finding creative solutions to our financial issues. Since desegregation took root in our institutions and began to gut them, a financial crisis has been brewing and its presence shows up every time we see another HBCU close its doors and even more starkly today in the amount of student loan debt HBCU graduates finish with as a result of poor endowments. HBCUs have taken on a what has seemingly become a check to check mentality in dealing with its financial viability. Instead of investments in R&D and entrepreneurship (Can HBCUs Produce Billionaires?), which is where the nation’s wealth has truly been generated for colleges and their alumni, we have seen far too many HBCUs and their alumni seemingly double down on being dependent on tuition revenue, make poor investments in athletics with no real return possible, focusing their students on getting jobs not creating them, and at times a feeling of lip service in relation to developing stronger pre-alumni and alumni programs that would strengthen giving.

It begs the question where do we go from here? How do we get administrations to ensure that intellectual property & patent development is a stronger part of its focus and how do we get alumni to give their time and money in a way that compliments and assist HBCUs in the infrastructure needed for said development? And ultimately, how do we turn our campuses into intellectual property machines? Let us examine, just a few points (but certainly not limited too) what HBCUs and their alumni could do to unleash its intellectual prowess:

First and foremost, we have to look at our research, patent development, and the like from a holistic viewpoint, meaning that anyone and any department on campus can be engaged in this process. That means everyone from the traditional route of professors and researchers to students to staff to cafeteria workers or lawn and building maintenance. Everyone must be part of this and everyone must be mentally engaged and present. A patent can come from anywhere and for us it needs too. For example, Paul Quinn a few years ago eliminated salt and pork from its campus, but what if a cafeteria worker created a way to still “salt” a product or their farm created a method by which you could raise a pig that does not adversely impact a human’s health. This would become an extremely valuable intellectual property that could be commercialized into a company that the school had an ownership stake in or licensing it out to major food companies and receiving royalties the way the University of Florida does with Gatorade to this very day.

Second, campuses need an intellectual property czar and department. Yes, create a position whose only job it is to promote, oversee, and help develop intellectual property. Their job would be to help ease the process, especially for the likes of students and staff who may not be as familiar with the process as professors, but even with professors helping ease the burden of the process would go a long way. The czar and department would be charged with identifying potential customers and creating commercial relationships where the intellectual property maybe of value. They would also assist in bringing in intellectual help if an idea is being developed but the technology or expertise to bring it to bear is not available on the campus. Perhaps, a relationship with a local software company or factory lends itself to the completion of the patent or intellectual property. Also finding opportunities where intellectual focus can financially benefit the school. An example of this would be the X Prize Foundation, where in 1996 for instance a businessman and entrepreneur offered a $10 million prize to the first privately financed team that could build and fly a three-passenger vehicle 100 kilometers into space twice within two weeks. Participating in these not only has potential financial benefits, but also raises the profile of the institution.

Thirdly, community and alumni access. Allowing the use of this broadens the probability that ideas and opportunities will come to the schools themselves and serve as a potential repository. Imagine for instance had Tuskegee been setup in such a way that when Lonnie Johnson, the Tuskegee alum who invented the Super Soaker, was able to come back to the school, use some of its resources, get assistance, etc. in exchange for a percentage of future or potential royalties. In 2013, he was awarded almost $75 million alone in royalties from Hasbro. An amount that is well over half of Tuskegee’s assumed endowment. Community access would also include summer camps to engage K-12 children in thinking as problem solvers. In other words, also developing the pipeline of intellectual property creators of tomorrow is integral.

Lastly, alumni must donate to create time for this all to be possible. How many HBCU professors can sit on campus for a semester, not teach, and simply focus on research? Very few, if any. How many students could stay on campus over the summer and experiment? Again, very few, if any. In fact, one of the primary problems that HBCU campuses have over summers is shutting down facilities in an effort to save money instead of opening them up for use to their professors, staff, students, and even the community. Those summer camps for K-12, which can lead to future HBCU students. Again, they need support and funds. Alumni must supply the funds to keep the lights on. Summertime is not a time to shutdown, but a time to have an opportunity to do the out of the box things that perhaps the semester schedules bog down. That can not happen without a targeted focus and strategic giving by alumni.

Patents, intellectual property, and the financial benefits that come with them currently are largely aligned with some of the nation’s largest endowments should come to no surprise to anyone who follows higher education finance. The top five producing patent colleges and universities between 1969-2012 (2018 endowment rank in parentheses), University of California (12) has 7,488 patents, MIT (6) has 4,017 patents, Stanford University (4) has 2,403 patents, CIT (34) has 2,365 patents, and the University of Texas (3) has 2,321 patents. In fact, these five schools have a combined endowment value of $51.5 billion as of 2018. Is there primary revenue from patents? Certainly not, but is the money insignificant? Also, certainly not. For HBCUs though, it could be life saving.

Even the way we engage this process may need to be outside of the normal box. For a lot of schools, even with alumni support, it maybe difficult to implement a program like this. However, one solution could be that the five HBCU conferences take the lead to allow for scale and best use of resources or HBCUs partner with other HBCUs and create a IP consortium and they profit-share. Stronger together. However it has to come together, it must. The financial future of HBCUs is rooted in becoming the problem solvers of today and tomorrow. It is time we focus, harness, and unleash the brilliant minds that constitute our institutions. Our bodies were used to build wealth for others for centuries, it is time to let our minds be the slingshot to our own (financial) freedom.

*Bowie State University was awarded its first patent in 2018.

The 2016-2017 HBCU Graduate Student Loan Report


There is scarcely anything that drags a person down like debt. – P.T. Barnum

The most recent study on HBCU student loan debt by HBCU Money shows a continued trend in this our third installment of tracking the crisis at our nation’s Historically Black Colleges & Universities. Whatever the nation thinks of the overall student loan crisis, it pales in comparison to what is happening at HBCUs. America’s student loan flu is African America’s student loan pneumonia with no insurance.

To put it mildly, the HBCU student loan crisis continues to be complicated. Overall, less HBCU students are graduating with debt as a percentage, which is a positive thing. Although the cause of why that number continues to drop is very unclear. The other piece of the puzzle though is the amount of student loan debt HBCU students are graduating with is skyrocketing. In the five years since our original report, the median student loan debt for an HBCU graduate is up twenty percent. Over that same period, median student loan debt for those graduating from a Top 50 endowed college or university is up only six percent.

The results are paired against America’s 50 largest universities by endowment which varied by geography, public and private status, and school size similar to that of HBCUs. The Project on Student Debt by The Institute for College Access and Success reports that in America overall, “New data show that the average student debt for college graduates continues to climb but at a slower pace, according to a report released by the Institute for College Access & Success. Nationally, about two in three (65 percent) college seniors who graduated from public and private nonprofit colleges in 2017 had student loan debt. These borrowers owed an average of $28,650, 1 percent higher than the 2016 average.”

Numbers in parentheses shows the comparative results from the universities of the 50 largest endowments:

Median Debt of an HBCU Graduate – $34,131 ($24,237)

Proportion of HBCU Graduates with debt – 86% (40%)

Nonfederal debt, % of total debt of graduates – 4% (26%)

Pell Grant Recipients  – 71% (15%)

Statistics show that HBCU graduates are almost 32 percent more likely to graduate with debt than the national average, this number is up from 28 percent a few years ago. As the nation continues to increase the percentage of graduates with debt, HBCUs are actually decreasing its percentage is a canary in the coal mine. Again, it is unclear what is causing the drop. HBCU graduates are an astonishing 115 percent more likely to graduate with debt than those graduating from a Top 50 endowed college or university, by far the worst number in our report’s history with the previous being 96 percent more likely three years ago and 93 percent more likely five years ago. A disturbing trend upwards if there ever was one. The percentage of HBCU graduates finishing with debt is down over four percent in the past five years, while Top 50 endowed college or university graduates have seen the percentage of graduates graduating with debt down over eleven percent.

In terms of the debt itself, as mentioned the median student loan debt is up over twenty percent since our inaugural report five years ago. Disparagingly, student loan debt for HBCU graduates is more than 40 percent greater than Top 50 endowed college and university graduates. This creates a number of socieoeconomic issues  for HBCUs themselves and for the graduates they hope will be able to benefit from education’s upward mobility in wealth accumulation.

Median Total Cost of Attendance – $22,866 ($66,623)

The cost of attending an HBCU should be an advantage for African Americans, but poor endowments and lack of familial wealth continue to negate the one primary advantage HBCUs have, cost. Despite costing almost three times more over a four year period, Top 50 endowed colleges and universities are managing to graduate those who finish with debt at about 9 percent of the total cost of attendance over that four year period. In contrast, for HBCU graduates, they are finishing with 37 percent of the total cost of attendance over the same period.

Three years ago in our second report we said this and it remains true here in our third report as well, “Unfortunately, HBCUs are caught between a rock and hard place in needing to desperately raise tuition to generate more revenue because of weak endowments, but doing so increases an already over-sized burden on their graduates long-term and making it even less likely they will become the donors that the institutions desperately need. It has become a vicious cycle and with so much of African America and America invested in the demise of HBCUs that it seems only a miracle will keep us from perishing.” Without transformative donations of the eight and nine figure variety on a more consistent basis, then it is hard to see the student loan debt load decreasing or even plateauing at this point. A somber reality in a world where education is becoming increasingly vital for upward mobility for individuals, families, and communities.

Alabama A&M University Students Standout At APA’s 2018 National Planning Conference In New Orleans


“Without leaps of imagination or dreaming, we lose the excitement of possibilities. Dreaming, after all is a form of planning.” – Gloria Steinem

This year’s American Planning Association in New Orleans was a success for both the organization and for the exposure that a set of Alabama A&M University students (pictured above) received who were in attendance.

American Planning Association’s history dates back to 1978 when the American Institute of Planners and the American Society of Planning Officials merged and decided to move forward under a united banner with the aim of, “organized exclusively for charitable, educational, literary and scientific purposes to advance the art and science of planning and the activity of planning — physical, economic, and social — at the local, regional, state and national levels.” Today, the website states that the organization’s current vision revolves around, “provides leadership in the development of vital communities by advocating excellence in planning, promoting education and citizen empowerment, and providing our members with the tools and support necessary to meet the challenges of growth and change.” Something that is a vital exploration of HBCU towns and surrounding communities who are often highly undeveloped.

Alabama A&M, located in Huntsville, Alabama, like many rural HBCUs is a flagship institution in the halo geography of its location. Huntsville is home to almost 200 000 residents along with a strong NASA presence. affordable housing, the future for Huntsville could be extremely bright – and therefore Alabama A&M impact on the area could also be . However, who will ultimately play a role in shaping Huntsville’s future? Hopefully, with a strong planning program like the one being developed at AAMU, it will be their alumni who will sit in public office and private firms and shaping the future and influence of the city. Ultimately, a benefit to the institutional capital of Alabama A&M University.

The APA annual conferences and workshops provide intellectual discourse on what is shaping communities is often attended by the who is who among public and private interests looking to get a glimpse into the future of how to provide the assets that will allow them to continue to grow and flourish. Given that HBCUs and the towns they reside in, especially in rural areas, maybe the last bastion of fighting gentrification and building sustainable African American communities, it is vitally important for HBCUs, their professors, and students especially continue to be present.

We were able to catch up with Tayla Solomon, a rising junior at Alabama A&M and Urban Planning major with a minor in Political Science,  who was one of the Bulldogs in attendance at the conference and got her to share her thoughts on attending:

What made you decide to major in Urban Planning? I decided to major in urban planning when I visited spring ‘16. My college counselor, Paula Dofat, made it possible for me and another classmate to drive to AAMU from Baltimore. I knew I wanted to major in something that not only caught my attention but would be if a great impact to the world in many ways.

Was this your first time attending the APA conference? Yes, this was my first planning conference. I’m excited to start fundraising for the next one.

Was Alabama A&M University the only HBCU present that you are aware of? If so, do you think it is important for more HBCUs to be present in the organization and conference? If so, why? AAMU was not the only HBCU at the conference. But there are a limited amount of HBCU’s that are accredited in urban planning. HBCU’s make up a small number in most conferences and most do not have the funds to participate.

What was the most important take away for you from this conference? The most important thing I took away from the conference was to network. There are thousands of people who share the same interest in you and they are also willing to help you and work with you. Once you step out of your comfort zone you will become unstoppable in whatever you put your mind to.

Did you have a favorite workshop that you attended and what was it on? I cannot remember my favorite one exactly but it talked about making vacation area sustainable for long term housing.

Lastly, what is your dream pursuit within the field of planning? My dream is to ensure better living conditions in impoverished cities. I hope to get a chance to work in every field of planning, mainly housing, environmental, and transportation.

If you want to donate to Tayla Solomon and the other Urban Planning students to attend more conferences, please contact: Ms. Heidi Weaver, Secretary, Tel: 256-372-5426, heidi.weaver@aamu.edu