Robert F. Smith Commits $50 million to support STEM students at HBCUs

Billionaire, chairman and CEO of Vista Equity Partners Robert F. Smith is donating $50 million to the Student Freedom Initiative at Historically Black Colleges and Universities (HBCUs).

The Student Freedom Initiative is a non-profit organization that helps students at HBCUs and other minority institutions settle student debts and loans. The Initiative was created to provide onramps to jobs of the 21st century. It offers students an income-based alternative to taking high-cost loans and offers students internship and study options.

“Each year, thousands of Black graduates from HBCUs across America enter the workforce with a crushing debt burden that stunts future decisions and prevents opportunities and choices,” said Mr. Smith. “A college education should empower and prepare our next generation for a limitless future.”

“The student Freedom Initiative is a culmination of work that followed my gift to the Morehouse College Class of 2019. The $1.6 trillion student debt crisis. The Initiative is purposefully built to redress historic economic and social inequities and to offer a sustainable, scalable platform to invest in the education of future Black leaders.”

With the current rate of the average student loan debt being $30,000 and the average loan interest being 5.8%, it may take some students nearly a decade to repay their loans. 65% Black wealth is consumed by the unbearable burden of paying off student loan debt, according to Business Wire.

“This is the only structure that we know of that has been built for HBCUs to support students at scale and that does not depend on the endowment of a university or funding by for-profit funders,” said the CEO of UNCF and Board Member of the Student Freedom Initiative, Dr. Michael Lomax. “Robert F. Smith’s extraordinary philanthropy is a giant first step toward a self-sustaining pool of funds that we can invest in promising students, particularly those pursuing STEM careers.”

The Initiative will kick off with 11 HBCUs; the names will be announced sometime in November. The program will be available to all qualifying STEM juniors and seniors at all HBCUs starting in the fall of 2021 academic year, until 2026.

In 2019, Smith pledged to pay off the loan debt of Morehouse’s graduating class of 2019. It was discovered by Mr. Smith’s team that the main problem students had with settling loan debts was paying off the full amount. Therefore, most students are limited to Parent PLUS loans and/or private loans.

Although Mr. Smith had made several charitable donations worth millions in recent years, the U.S Department of Justice charged him for hiding funds in overseas accounts, last week. He admitted to the DoJ that he knowingly hid funds in accounts abroad to evade taxes, as a result, he will pay back $130 million in taxes. Mr. Smith will have to abandon $180 million worth of charitable donations as he pledged.