African American billionaire wipes out student debt of 400 graduates
A billionaire technology investor and philanthropist says he will provide grants to wipe out the student debt of an entire graduating class, at Morehouse College in the US - an estimated $40m.
The investor, Robert F Smith, was the school’s commencement speaker this year, and made the announcement on Sunday morning whilst addressing nearly 400 graduating seniors of the all-male historically black college in Atlanta.
Mr Smith is the Founder and CEO of Vista Equity Partners, a private equity firm that invests in software, data and technology driven companies.
“On behalf of the eight generations of my family that that have been in this country, we’re gonna put a little fuel in your bus,” Smith told the graduates.
“This is my class, 2019. And my family is making a grant to eliminate their student loans.”
The announcement elicited stunned looks from faculty and students alike, before the graduates broke into the biggest cheers of the morning. Morehouse said it was the single largest gift to the college.
Smith, who received an honour doctorate from Morehouse during the ceremony, has already announced a $1.5m gift to the school.
Smith said he expected the receipt ants to “pay it forward” and said he hoped that “every class has the same opportunity going forward.”
In the weeks before graduating from Morehouse on Sunday, 22 year old finance major Aron Mitchum drew up a spreadsheet to calculate how long it would take to pay him back his $200,000 in student loans - 25 years at half his monthly salary, per his calculations.
In an instant that number vanished. Mitchom, sitting in the crowd, wept.
“I can delete that spreadsheet,” he said in an interview after the commencement.
“I don’t have to live off peanut butter and jelly sandwiches. I was shocked. My heart dropped. We all cries. In the moment it was like a burden had been taken off.”
His mother, Tina Mitchom, was also shocked. Eight family members, including Mitchom’s 76 year old grandmother, took turns over four years co-signing on the loans that got him across the finishing line.
Morehouse College President David A Thomas said the gift would have a profound effect on the students’ futures. “In some ways, it it a liberation gift for these young men that just opened up their choices.”
Mr Smith, whose fortune is estimated at $2.5 billion, was relatively unknown before making headlines as the second largest private donor to the National Museum of African American History and Culture in Washington. His gift of $20 million was beaten only by Oprah Winfrey’s of $21 million.
Student loan debt in the USA reached its highest level in history in 2019, totalling about $1.5 trillion among 44 million borrowers in the US.
