“Note: These data are based on colleges, universities, affiliated foundations, and related nonprofit organizations that volunteered to participate in NACUBO’s endowment study series.” – NACUBO
With a looming enrollment crisis for all America’s colleges and universities, we are at a time where endowments are not only going to matter more they are going to matter the most. The building of endowments, cutting of some overweight athletic expenses that allow you to invest more, aggressive fundraising efforts, joint investing with other HBCUs, everything should be on the table. This is an arms race for survival. We have been at alert level red for awhile but apparently the sound of the siren has been broken. Now it is fixed and it is blaring. HBCU endowments are a key and integral component to African American wealth building both individually and institutionally. Their importance to African America’s economic survivability, sustainability, and empowerment cannot be overstated enough. That HBCU endowments continue to be that is a matter of conversation about who at HBCUs should be benefitting and prioritized most by our endowments.
HBCU endowment analysis from 2023 will not reflect that Spelman College kicked off 2024 with HBCUs largest ever donation and the first ever nine figure donation with its $100 million donation from Ronda Stryker and William Johnston. We will see how much of the $100 million makes it into Spelman’s actual endowment coffers this time next year, but even without it Spelman leads all HBCUs in NACUBO’s new category of endowment value per full-time equivalent (FTE) student with $197,713 per Spelmanite versus Florida A&M University’s worrisome $6,044 endowment value per full-time equivalent student. This arguably is a more accurate of how healthy a college or university’s endowment is performing to some degree which we covered in ‘Without Hyperactive Alumni, HBCUs Will Bear The Brunt Of The Building Tsunami Of College Closures And The End Of Their Blackness’. Only Spelman College and Meharry Medical College have endowment value per FTE above $100,000. The national average is $174,499 among all college and universities and median is $47,287. HBCUs reporting have an average of $63,861 and median of $19,256.
On the good news from 2023 is Morgan State University and Virginia State University breaking into the $100 million endowment club as only the ninth and tenth HBCUs to do so. It is assumed that Tuskegee University (not reported) based on their FY 2018 Fact Book also has an endowment above $100 million. This means that roughly 10 percent of the remaining HBCUs have endowments above $100 million. Unfortunately, the gap between that group and those below is staggering with there being questions of a larger percentage of HBCUs potentially having no endowment as a possibility. Lastly, unless Spelman comes through with another jaw-dropping donation (it is certainly possible), then at some point in 2024 Howard University’s endowment will cross the $1 billion mark making it the first HBCU to do so.
The PWI-HBCU NACUBO Top 10 Endowment Gap for 2023 stands at $128.7 to $1, which is an increase from 2022’s $127.5 to $1.*
HIGHLIGHTS:
- Top 10 HBCU Endowment Total – $2.2 billion
- Top 10 PWI Endowment Total – $321.6 billion
- Number of PWIs Above $2 billion – 74
- Number of PWIs Above $1 billion – 139
- Number of HBCUs Above $1 billion – 0
- Number of HBCUs Above $100 million – 9
- 688 colleges, universities, and education-related foundations completed NACUBO’s FY23 survey and those institutions hold $839 billion of endowment assets with an average endowment of $1.2 billion and median endowment of $209.1 million.
- HBCUs comprised 1.4 percent of NACUBO’s reporting institutions and 0.3 percent of the reporting endowment assets.
- PWI endowments (30) with endowments over $5 billion hold 58 percent of the $839 billion in endowment assets.
All values are in millions ($000)**
1. Howard University – $926,633 (7.4%)
Endowment Value Per Full-Time Student – $81,341
2. Spelman College – $474,907 (3.4%)
Endowment Value Per Full-Time Student – $197,713
3. Meharry Medical College – $179,287 (6.0%)
Endowment Value Per Full-Time Student – $165,394
4. North Carolina A&T State University – $164,720 (0.1%)
Endowment Value Per Full-Time Student – N/A
5. Florida A&M University – $113,378 (1.7%)
Endowment Value Per Full-Time Student – $6,044
6. Morgan State University – $101,037 (12.9%)
Endowment Value Per Full-Time Student – N/A
7. Virginia State University – $100,935 (45.1%)
Endowment Value Per Full-Time Student – $22,903
8. Norfolk State University – $83,525 (17.4%)
Endowment Value Per Full-Time Student – $16,149
9. Fayetteville State University – $31,280 (-2.2%)
Endowment Value Per Full-Time Student – $5,479
10. Kentucky State University – $20,238 (6.3%)
Endowment Value Per Full-Time Student – $15,861
*Due to Hampton University and Morehouse College not participating this year significantly altered the Top 10 HBCUs endowment combined total. Therefore, HBCU Money took the editorial liberty of calculating the PWI-HBCU endowment gap based on 2022’s HBCU endowment total of $2.5 billion.
**The change in market value does NOT represent the rate of return for the institution’s investments. Rather, the change in the market value of an endowment from FY21 to FY22 reflects the net impact of:
1) withdrawals to fund institutional operations and capital expenses;
2) the payment of endowment management and investment fees;
3) additions from donor gifts and other contributions; and
4) investment gains or losses.
SOURCE: NACUBO
Take a look at how an endowment works. Not only scholarships to reduce the student debt burden but research, recruiting talented faculty & students, faculty salaries, and a host of other things can be paid for through a strong endowment. It ultimately is the lifeblood of a college or university to ensure its success generation after generation.
HBCU Money 