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UNPRECEDENTED: MacKenzie Scott Transforms HBCU Endowments With A Flurry Of Million Dollar Gifts In 2020

Guilt: the gift that keeps on giving. – Erma Bombeck

The year of George Floyd’s death and the European American guilt that accompanied it can be argued was the catalyst that led to the largest flurry of million dollar plus donations to HBCUs ever seen and it was led almost solely by one woman – MacKenzie Scott, the quietly known co-founder of Amazon who has emerged as a powerhouse in the world of philanthropy. Of the reported 37 donations of $1 million or more as reported by the Chronicle of Philanthropy to HBCUs, Ms. Scott is responsible for 22 of them. Her donation to Prairie View A&M University was the largest in the school’s history and the largest ever to a public HBCU. Questions of where the money actually ends up and who is managing it given Prairie View’s relationship to Texas A&M are worth investigation by PVAMU alumni. All the same, HBCU endowments began 2020 standing at approximately $2.1 billion combined. 2020’s million dollar plus donations to HBCUs are equivalent to roughly 33 percent of that – in one year. To put in perspective, these donations to HBCUs in 2020 were greater than Howard University’s 150 plus year old endowment and would be the equivalent of someone donating approximately $15 billion to Harvard’s endowment, which Ms. Scott actually could do. Again, unprecedented.

We have expanded our review of the data collected to include more information regarding those major donations to HBCUs as well as their presence in the overall landscape of major donations to all colleges and universities. Are HBCUs getting their share? Although HBCUs make up three percent of the United States higher education ecosystem, they do not tend to receive three percent of the philanthropic donations or value. This year breaks the mold with HBCUs receiving over 11 percent of the major donations and over 15 percent of the major donation value. Unprecedented is putting it mildly. While this infusion is beyond needed and could not come at a better time as many higher education institutions across the country are having real questions of future and long-term fiscal viability, those with well position endowments have far less to worry about in their ability to have the resources necessary to pivot in an ever changing education landscape. Despite this landslide of donations, there are still no HBCUs with a $1 billion endowment or more. Howard University is still leading the way and looking like the inevitable first, but after Howard and Spelman, there are a myriad of questions and concerns as to the endowment health of every other HBCU.

Despite no African American having the wealth to give at the scale of MacKenzie Scott, it still begs the question of where are the African American wealthy in making major donations to HBCUs on a more consistent and sustainable basis. Only 4 of the 37 donations on 2020’s list come from African American families. George Floyd’s death was clearly a catalyst for much of this giving to African American institutions in 2020, but relying on Black death as a means to spur major giving is morally problematic and acutely unsustainable. There is no reason that this list every year is not made up of predominantly African Diaspora and African American households. For reasons that are complex though, that has still yet to happen. It is also worth noting which schools received donations. While the usual suspects of Morehouse College, Spelman College, and Howard University are there, one-third of the donations went to public HBCUs whom rarely find themselves in the philanthropic spotlight. Lesser known, but just as important HBCUs like Claflin University, Lincoln University (PA), and Xavier University (LA) also showed up. A vital need is for the smaller HBCUs to receive major gifts, HBCUs like Texas College, Florida Memorial University, Virginia University at Lynchburg also badly need to receive major gifts to shore up their fiscal futures. African American households must be the one to lead that charge if major giving to HBCUs is to be burning bright tomorrow and not just a firecracker today.

$1 Million Plus Donations To All Colleges: 329

$100 Million Plus Donations To All Colleges: 7

$1 Million Plus Donations Value To All Colleges: $4.7 Billion

$1 Million Plus Median Donation To All Colleges: $6.0 Million

$1 Million Plus Average Donation To All Colleges: $14.4 Million

$1 Million Plus Donations To HBCUs: 37*

$100 Million Plus Donations To HBCUs: 0

$1 Million Plus Donations Value To HBCUs: $716.7 Million

$1 Million Plus Median Donation To HBCUs: $20.0 Million

$1 Million Plus Average Donation To HBCUs: $19.4 Million

HBCU Percentage of Donations To All Colleges: 11.2%

HBCU Percentage of Donation Value To All Colleges: 15.2%

1. MacKenzie Scott (pictured) – $50 million
Recipient: Prairie View A&M University
Source of Wealth: Technology, Retail

2. MacKenzie Scott – $45 million
Recipient: North Carolina A&T State University
Source of Wealth: Technology, Retail

3. Reed Hastings & Patty Quillin  – $40 million
Recipient: Morehouse College
Source of Wealth: Technology

4. Reed Hastings & Patty Quillin – $40 million
Recipient: Spelman College
Source of Wealth: Technology

5. Reed Hastings & Patty Quillin – $40 million
Recipient: United Negro College Fund
Source of Wealth: Technology

6. MacKenzie Scott – $40 million
Recipient: Morgan State University
Source of Wealth: Technology, Retail

7. MacKenzie Scott – $40 million
Recipient: Norfolk State University
Source of Wealth: Technology, Retail

8. MacKenzie Scott – $40 million
Recipient: Howard University
Source of Wealth: Technology, Retail

9. MacKenzie Scott – $30 million
Recipient: Virginia State University
Source of Wealth: Technology, Retail

10. MacKenzie Scott– $30 million
Recipient: Winston-Salem State University
Source of Wealth: Technology, Retail

11. MacKenzie Scott – $30 million
Recipient: Hampton University
Source of Wealth: Technology, Retail

12. MacKenzie Scott – $25 million
Recipient: Alcorn State University
Source of Wealth: Technology, Retail

13. MacKenzie Scott – $25 million
Recipient: Bowie State University
Source of Wealth: Technology, Retail

14. MacKenzie Scott  – $20 million
Recipient: Claflin University
Source of Wealth: Technology, Retail

15. MacKenzie Scott – $20 million
Recipient: Delaware State University
Source of Wealth: Technology, Retail

16. MacKenzie Scott – $20 million
Recipient: Lincoln University (PA)
Source of Wealth: Technology, Retail

17. MacKenzie Scott – $20 million
Recipient: Tuskegee University
Source of Wealth: Technology, Retail

18. MacKenzie Scott – $20 million
Recipient: Xavier University (Louisiana)
Source of Wealth: Technology, Retail

19. MacKenzie Scott – $20 million
Recipient: Morehouse College
Source of Wealth: Technology, Retail

20. MacKenzie Scott – $20 million
Recipient: University of Maryland-Eastern Shore
Source of Wealth: Technology, Retail

21. MacKenzie Scott – $20 million
Recipient: Spelman College
Source of Wealth: Technology, Retail

22. MacKenzie Scot– $15 million
Recipient: Clark Atlanta University
Source of Wealth: Technology, Retail

23. MacKenzie Scott – $15 million
Recipient: Elizabeth City State University
Source of Wealth: Technology, Retail

24. Anonymous Donor – $10 million
Recipient: Prairie View A&M University
Source of Wealth: N/A

25. Bruce Karsh and Martha Karsh  – $10 million
Recipient: Howard University
Source of Wealth: Finance

26. Seth Klarman and Beth Klarman – $10 million
Recipient: Spelman College
Source of Wealth: Finance

27. MacKenzie Scott – $6 million
Recipient: Tougaloo College
Source of Wealth: Technology, Retail

28. MacKenzie Scott – $5 million
Recipient: Dillard University
Source of Wealth: Technology, Retail

29. Oprah Winfrey – $2 million
Recipient: Tennessee State University
Source of Wealth: Media & Entertainment

30. Matthew Cullinan and Anna Reilly – $1.7 million
Recipient: Winston-Salem State University
Source of Wealth: Education

31. Jim Murren and Heather Murren – $1 million
Recipient: Howard University
Source of Wealth: Finance

32. Charles Butt – $1 million
Recipient: Prairie View A&M University
Source of Wealth: Retail

33. Charles Barkley – $1 million
Recipient: Miles College
Source of Wealth: Entertainment

34. Kenneth Chenault and Kathryn Chenault – $1 million
Recipient: Morehouse College
Source of Wealth: Finance

35. Joan Johnson – $1 million
Recipient: Spelman College
Source of Wealth: Retail

36. Frank Baker & Laura Day  – $1 million
Recipient: Spelman College
Source of Wealth: Finance

37. Charles Barkley – $1 million
Recipient: Tuskegee University
Source of Wealth: Entertainment

Source: Chronicle of Philanthropy

*Michael Bloomberg’s pledge of $100 million in 2020 to the 4 HBCU medical schools was not included in our list which was sourced strictly from the Chronicle of Philanthropy.

The 2019-2020 SWAC/MEAC Athletic Financial Review

In the fourth HBCU Money report on the SWAC/MEAC’s athletic finances, there has been one trend that is consistent – an acute amount of red on the balance sheet of each respective HBCU as it pertains to their athletic departments and it continues to grow redder and redder. Since HBCU Money first began reporting the SWAC/MEAC Athletic Financial Review, there have been losses of $128.6 million (2014-2015), $147.1 million (2016-2017), $150.7 million (2017-2018), and this year they continue their trend of the athletic black hole with losses over $161 million through athletics with no correction in sight. Not exactly the cash generating juggernauts that HBCU alumni have in mind when it comes to how deeply many believe that athletics can be the financial savior to HBCU financial prosperity. Instead, athletics seems to be potentially at the crux of many HBCU financial woes. Almost unfathomable is that many in the SWAC/MEAC have athletic budgets higher than their research budgets.

The harsh reality is that even with all the popularity buzz generated by Jackson State University’s head football coach, Deion Sanders, the factors working against HBCU athletics ever achieving real profitability remains a pipe dream at best. To land a major television contract, which is the only reason on mass that the SEC and Big 10 are the profitable athletic programs they are requires something that HBCU alumni bases severely lack. Large fan bases that have high incomes and an affluence. The harsh reality that HBCUs have small alumni bases, a reality that has been exacerbated post-desegregation where now HBCUs only get 9 percent of African Americans in college, combined with African America having both the lowest median income and wealth do not make for a recipe for advertisers to pay top dollar to television stations who would then healthily compensate HBCU institutions. HBCU athletics can be profitable, but it requires a completely different business model than our PWI counterparts. See, “The 5 Steps To HBCU Athletic Profitability”.

HBCU athletic revenues went down while expenses and subsidies went up in 2019-2020. That is usually a trend all would prefer be flipped. Students continue to bear the brunt of generating HBCU athletic revenues. This year’s review shows that approximately 73 percent of HBCU athletic revenues are generated through subsidies, up from 70 percent the year prior. Something to consider when 90 percent of HBCU students graduate with student loan debt.

REVENUES (in millions)

Total: $200.4 (down 1.2% from 2017-2018)

Median: $10.3 (down 4.6% from 2017-2018)

Average: $10.6  (up 5.0% from 2017-2018)

Highest revenue: Prairie View A&M University  $18.7 million

Lowest revenue: Coppin State University  $2.8 million

EXPENSES (in millions)

Total: $213.0 (up 0.5% from 2017-2018)

Median: $12.5 (up 15.7% from 2017-2018)

Average: $11.2 (up 5.7% from 2017-2018)

Highest expenses: Prairie View A&M University  $18.7 million

Lowest expenses: Mississippi Valley State University  $3.9 million

SUBSIDY

Total: $148.4 (up 4.9% from 2017-2018)

Median: $6.4 (down 18.4% from 2017-2018)

Average: $7.1 (unchanged from 2017-2018)

Highest subsidy: Prairie View A&M University $15.5 million

Lowest subsidy: Coppin State University $1.7 million

Highest % of revenues: Delaware State University: 92.0%

Lowest % of revenues: Florida A&M University: 37.0%

PROFIT/LOSS (W/ SUBSIDY)

Total: $-12.7 million (down 40.0% from 2017-2018)

Median: $0 (up 100.0% from 2017-2018)

Average: $-666,295 (down 46.3% from 2017-2018)

Highest profit/loss: North Carolina A&T State University  $615,094

Lowest profit/loss: North Carolina Central University  $-6,264,082

PROFIT/LOSS (W/O SUBSIDY)

Total: $-161.0 million (down 6.8% from 2017-2018)

Median: $-9.8 million (down 40.0% from 2017-2018)

Average: $-8.5 million (down 13.3% from 2017-2018)

Highest profit/loss: Mississippi Valley State University  $-2,177,123

Lowest profit/loss: Prairie View A&M University  $-15,417,471

CONCLUSION: At current, it would take an approximately $4.3 billion endowment dedicated to athletics to ween the SWAC/MEAC off of these subsidies onto a sustainable path. A sum greater than all HBCU endowments combined. Perhaps through merchandise sales, Jackson State could see its way to profitability without subsidies. Perhaps, but as former HBCU alumnus and NFL Hall of Famer Shannon Sharpe recently said, “There is only one Deion Sanders”. One thing is for certain, HBCUs have not done a proper cost-benefit analysis for the money they spend and subsidize to their athletic departments nor have they explored potential alternative models.

Editor’s Note: Howard and Bethune-Cookman are excluded in this report because they are private institutions and their athletic finances were not included in this report.

Source: USA Today

Internet Services Startup Launched By Three HBCUpreneurs – Who Have Never Met

“Great things in business are never done by one person. They’re done by a team of people.” – Steve Jobs

It is a business story worthy of Hollywood. Mainly because it seems to be a storyline that you only find in movies. However, the story is very real and very powerful. Not only because of its potential, but also because of the possibilities that it presents. Three HBCUpreneurs from three different HBCUs start a business, but have never actually met each other in person. The power of the internet, the power of Twitter and most importantly, the power of the HBCU community.

The company, HBCU Real Estate, is an internet services company that seeks to help the HBCU community (but not limited too) find and use HBCU real estate service providers. Everything from real estate agents, mortgage brokers, interior designers, and more. The founders hope that it will even lead to business creation in the spaces of real estate that the HBCU community may have little to no presence. HBCU Money is aware of only one title company* owned by an HBCU alumnus. HBCU Real Estate’s mission is to help facilitate circulation of the HBCU community’s dollars and keep them in the HBCU community. If successful, it could potentially keep tens of billions of dollars within the HBCU community. The fact that none of the founders have ever met in person makes what they are trying to accomplish even more astounding.

For two years it sat on the proverbial shelf according to organizer, cofounder, and HBCU Real Estate’s Director of Product Development, William A. Foster, IV, a Livingstone College, Virginia State University, and Prairie View A&M University alumnus. “I am a multipreneur and have learned that more hands and brains on deck is almost always a good thing. I needed to meet and find the right people who could understand, compliment, add value, and who could see the potential just as much as I could. Also, I promised myself no more solo projects. When you are involved in as many businesses and organizations as I am, being able to spread the load is vital to success – and sanity.”

Enter Christen Turner, Spelman College and Southern University alumnus, and Marcus King, an alumnus of Prairie View A&M University, both HBCUpreneurs themselves. Ms. Turner, HBCU Real Estate’s Chief Technology Officer, also owns Janelle T. Designs, a graphic designs firm, as well as Forever Femme, an accessories company. Mr. King, HBCU Real Estate’s Chief Marketing Officer, owns Hardly Home, a clothing line that is catered towards travel that was featured on HBCU Money’s The HBCUpreneur Corner in 2015. What does it say to you (King) about the potential of collaboration for HBCUpreneurs that 5 different HBCUs are represented among the 3 cofounders? King answered, “The motto at my alma maters is that “PV produces productive people” and I think that can be said about HBCUs across the board. For years HBCUs have been producing top talent and should continue to do so as we seek to move forward and provide solutions to the problems our community faces.”

The three have followed each other on Twitter for years, although no one can remember for how long. It was towards the end of 2020 that Foster said he approached Turner and King about doing a collaboration or tweeted at them rather. “I sent out a tweet and tagged both of them saying that I need to cofound something with the two of them. Having watched them over the years I knew we would click and have the same kind of work ethic. I just needed to find out if they thought the idea had any legs. If it was not this, it was going to be something else.” The work ethic was confirmed when he said he got an email from Turner on Thanksgiving while he himself was working. Turner further drove the point home of the potential of the moment, “This business will be successful because of two reasons, respect and trust. Despite not having met in an ‘official’ capacity, our partnership seems to have a natural fit to it; almost like pieces of a puzzle. With William’s intuition, he was able to unknowingly add the right people to his team who would each be able to add something different. Whether from a professional standpoint or specific personality traits, we all came in with an immediate respect for each other’s talents and skills. This is why the business will be successful. There’s no questioning; there’s only action, openness, and honesty.” Usually in Hollywood the movie ends with and they lived happily ever after – The End, but in this case it is clear that this is just The Beginning.

For more information, visit http://www.hbcurealestate.com

Morehouse, Morehouse, Morehouse: 2019’s Million Dollar Donations To HBCUs Dominated By The Tigers Of The AUC

“As I grow older, I pay less attention to what men say. I just watch what they do.”

–Andrew Carnegie

2019 proved to be a stellar year for HBCUs and million dollar donations. Since HBCU Money began tracking these donors, 2019 has the most million dollar plus donations with eleven, ten to HBCUs directly and one to an HBCU supporting organization. Also in terms of total value of donations 2019 sets the record with $66.1 million. The one hiccup is that the number of donations is still not representative of the percentage of HBCUs to overall colleges and universities. HBCUs accounted for only 2.2 percent of the million dollar plus donations in 2019 (despite accounting for 3 percent of the nation’s colleges). That being said, the sun shined as bright as it ever has in 2019. There will be plenty of complaints that Morehouse College dominates the list with virtually half of the donations, but that also speaks to alumni not investing enough in their HBCU’s development infrastructure which at most HBCUs is an underfunded and understaffed. Endowing positions in the development office is a great place for alumni to see a strong return on investment of their alumni dollars.

High-quality donors (who give consistently and over their lifetime will probably give six to seven figures of donations) continue to show up for HBCUs, but still not representative of HBCUs presence in America’s higher education landscape. While HBCUs represent three percent of the country’s colleges, HBCUs accounted for only 2.2 percent of the million dollar plus donations in 2019. Tranformative donors (who can change the paradigm of an entire institution with one donation) continue to elude HBCUs all together, while PWI/HWCUs landed 10 donations of $100 million plus in 2019. CalTech, a private research focused university in Pasadena, CA, landed an awe inspiring $750 million donation from Stewart & Lynda Resnick.

The gap this year between top eleven PWI/HWCU gifts totaled $2.1 billion while HBCUs as mentioned totaled $66.1 million or a $32 to $1 ratio.

1. Robert F. Smith (pictured) – $34 million
Recipient: Morhouse College
Source of Wealth: Finance

2. Oprah Winfrey – $13 million
Recipient: Morehouse College
Source of Wealth: Media & Entertainment

3. Eugene McGowan, Jr.  – $4.6 million
Recipient: Morehouse College
Source of Wealth: Education

4. Jeffrey Dean & Heidi Hopper – $4 million
Recipient: Howard University
Source of Wealth: Technology

5. Virginia Howerton – $2.5 million
Recipient: Virginia Union College
Source of Wealth: Consulting

6. Shari Griswold – $2 million
Recipient: Prairie View A&M University
Source of Wealth: Oil

7. William Pickard & Judson Pickard, Jr. – $2 million
Recipient: Morehouse College
Source of Wealth: Food & Beverage, Hotels & Casinos

8. Jon Stryker – $2 million
Recipient: Spelman College
Source of Wealth: Family Wealth

9. Robert F. Smith – $1.5 million
Recipient: Morehouse College
Source of Wealth: Finance

10. Oprah Winfrey – $1.5 million
Recipient: UNCF
Source of Wealth: Media & Entertainment

11. Jose Feliciano & Kwanza Jones – $1 million
Recipient: Bennett College
Source of Wealth: Marketing, Finance

Source: Chronicle of Philanthropy

HBCU Money™ Presents: 2019’s HBCU Alumni NFL Players & Salaries

The 6th annual installment of tracking the earnings of HBCU alumni who are NFL players, the University of Arkansas-Pine Bluff’s Terron Armstead retains the crown with a $5.5 million raise over his 2018 salary.

HBCU Money™ FACTS:

  • HBCU NFL players combine for $43.6 million, an almost 13 percent increase from 2018, when HBCU NFL players earned $38.7 million.
  • South Carolina State University & North Carolina A&T are tied with 4 NFL players each.
  • The SWAC has 9 players versus the MEAC’s 12 players in the league.
  • Average salary for HBCU NFL players is $1.9 million, an increase of $100,000 from 2018.
  • Median salary for HBCU NFL players is $930,000.
  • HBCU players account for 1.4 percent of the NFL’s 32 team active roster spots.
  1. Terron Armstead /UAPB / $15.8 million
  2. Antoine Bethea / Howard / $3.625 million
  3. Chester Rogers / Grambling State / $3.095 million
  4. Joe Thomas / South Carolina State / $2.237 million
  5. Tytus Howard (R) / Alabama State / $2.223 million
  6. Javon Hargrave / South Carolina State / $2.198 million
  7. Rodney Gunter / Delaware State / $1.75 million
  8. Ryan Smith / North Carolina Central /$1.697 million
  9. Darius Leonard / South Carolina State / $1.647 million
  10. Isaiah Crowell / Alabama State / $1.25 million
  11. Antonio Hamilton / South Carolina State / $1 million
  12. Brandon Parker / North Carolina A&T / $930,758
  13. Tarik Cohen / North Carolina A&T / $803,914
  14. Grover Stewart / Albany State / $749.912
  15. Tony McRae / North Carolina A&T / $645,000
  16. KhaDarel Hodge / Prairie View A&M / $570,000 (Tied)
  17. Trent Scott / Grambling State / $570,000 (Tied)
  18. Darryl Johnson / North Carolina A&T / $519,522
  19. Joshua Miles / Morgan State / $513,664
  20. Trent Cannon / Virginia State / $511,096
  21. Danny Johnson / Southern / $510,862
  22. Jamie Gillan / UAPB / $498,333
  23. Da’Lance Turner / Alcorn State / $268,235