Given his estimated $5 billion fortune, Robert F. Smith is the wealthiest African American in the U.S. (As a side note, I would point out that being “wealthy” is not the same as simply being “rich.” Idris Elba is rich; Robert Smith is wealthy.) Smith has held that title for several years — a fact will come as a surprise to the majority of Americans (of all races) who assume that Oprah Winfrey sits at the top of that pyramid. Smith’s recent act of philanthropy left most people stunned — and most Black folks beaming with pride.
For those who live on the moon, Robert Smith — while delivering this year’s commencement address at Atlanta’s Morehouse College — pledged to pay off the student loans for the class of 2019. The entire class of 2019. (Some have speculated that Smith’s gesture was spontaneous.) The total value of this gift is estimated to be approximately $40 million.
To keep things in perspective, Jeff Bezos’ net worth is roughly 20 times that of Smith. (Well, at least before Bezos’ recent divorce settlement.) Still, given his humble beginnings, Smith’s stunning financial success is truly a wonder to behold. He is the chairman and CEO of VISTA Equity Partners, which he founded in 2000. VISTA is a private equity and venture capital firm that has nearly $50 billion in what are called “capital commitments.” (In short, he buys and sells companies — and parts of companies — as well as gives money to those who would like to create their own businesses.) Smith’s story is an object lesson in the power of understanding, and taking charge of, the world of finance. Further, his generosity is widespread. Those who know Smith say that he frequently donates, mostly quietly, to several causes. (His $20 million gift to the Smithsonian’s Museum of African-American History was the second largest private gift — next to Winfrey’s $21 million donation.)
While Smith’s largess to the Morehouse grads is massive, it should be considered in the broader context of African American generosity. Several studies have shown that African Americans are the most philanthropic racial group in the U.S. That is, while our incomes and net worth relative (especially) to white Americans is quite low, we donate a higher percentage of said income to charitable purposes as compared to other racial groups. (The older and more southern we are, the more we give to church and faith-based causes; that is somewhat less true for younger and more northern Black folk.) Indianapolis has had its share of local philanthropic heroes and sheroes. Among them are the late businessman Bill Mays, attorney Lacy Johnson, and tech guru Robert Reed. Still, haircare pioneer Madam C.J. Walker (born Sarah Breedlove) is the standard by which all subsequent Black philanthropists in this city will be measured.
Mr. Smith’s generosity speaks to one of the greatest challenges to young (and not-so-young) people’s future financial success, namely, crushing debt from college loans. I should note that, unlike other types of major debt, most college loans cannot be discharged via bankruptcy — which many people belatedly learn. Sadly, the estimated aggregate college debt in this country is $1.5 trillion. That’s nearly 10% of America’s annual GDP. It is not hyperbolic to label that reality a genuine — and ever growing — financial crisis. This level of debt prevents many Americans from buying homes, being able to take care of their family adequately, or save for their children’s education. Thus, I pray that these young men truly understand that Smith did more than simply write a check; he gave them a new lease on life.
And, yes, I’m trying to find out whether I am a third or fourth cousin to Mr. Smith. Can’t you see the resemblance?
Larry Smith is a community leader. Contact him at firstname.lastname@example.org.