The Art of Sharing the Wealth

The Art of Sharing the Wealth

The Art of Sharing the Wealth

The world's richest African-American, Robert F. Smith may also be the most generous, and he's made making lives better an integral part of his personal success.

     
The Art of Sharing the Wealth
image by: Vista Equity Partners

You can call Robert F. Smith a self-made man. He grew up in a middle-class Denver neighborhood. As a high-school junior, through sheer persistence⎯calling every single day for five straight months⎯he landed a Bell Labs internship technically reserved for college students. After obtaining a degree in chemical engineering from Cornell and working for Kraft General Foods, he decided to switch gears and earned an MBA at Columbia. After a four-year stint at investment firm Goldman Sachs, in 2000 Smith founded Vista Equity Partners, which today holds $46 billion in cumulative capital commitments, success that has made its CEO the world's richest African-American, with a personal net worth of approximately $5 billion.

But all that self-made success has not led Smith to believe everyone else can simply pull themselves up by their bootstraps. If anything, his actions show he knows it's not that simple, especially for African-Americans, who on average hold only about one-tenth the wealth of their White counterparts. This is even worse than it sounds when you plug in concrete numbers, as Christian Weller did for Forbes earlier this year: "At the median, non-retired African-Americans had $13,460 in wealth in 2016 or only 9.5% of the median wealth of $142,180 that whites had at that time."

Not surprisingly, such financial inequity can be seen in regards to student debt. As Christopher Rim notes in a separate Forbes article, "[B]lack students are uniquely impacted by the student debt crisis [...] tak[ing] on 85% more debt than white students and repay[ing] it more slowly."

But thanks to Smith, 396 recent graduates from Morehouse College will have no such hinderances as they set out on their career paths. "We're going to put a little fuel in your bus," he said during his May 19 commencement address, before announcing that he will personally pay off every penny of the student debt for the entire 2019 class, a commitment that may cost his as much as $40 million. This on top of $1.5 million he gave to Morehouse earlier this year to fund scholarships and the construction of an outdoor campus study area.

It's merely the most recent example of Smith's philanthropic efforts to improve the lives of Black people in America. Previous gifts include $20 million to the National Museum of African American History and Culture and $50 million to Cornell (part of which is directly targeted to assist Black and female students). The Chronicle of Philanthropy reports that in 2016 alone he donated over $42 million to charity, among his 2018 donations include $500,000 to the City of Hope (half of which is earmarked for prostate cancer treatment for black men and for breast cancer research for black women), $2.5 million to the Prostate Cancer Foundation, and $1 million to Harlem's Cultural Performance Center.

Such generosity is simply par for the long philanthropic course Smith is playing. In May 2017, Smith signed the Giving Pledge, "a global, multi-generational initiative designed to help address society’s most pressing problems by encouraging the wealthiest individuals and families to give the majority of their wealth to philanthropic causes." By doing so, he has committed to donate half his net worth⎯during his lifetime⎯to charitable ends. And for Smith, those ends are about equal opportunity for all.

"[... P]otential is no guarantee of progress," he wrote when he took the pledge. "We will only grasp the staggering potential of our time if we create onramps that empower ALL people to participate, regardless of background, country of origin, religious practice, gender, or color of skin."

As if such charity were not enough, Smith also donates his time to organizations that help further these ends. For example, he serves as chair of Robert F. Kennedy Human Rights, a nonprofit whose programs "have pursued strategic litigation on key human rights issues, educated millions of students in human rights advocacy and fostered a social good approach to business and investment."

Smith is also founding director and president of the Fund II Foundation, which in 2014 came into being with a mission to "preserve the African-American experience; safeguard human rights; provide music education; preserve the environment while promoting the benefits of the outdoors; and sustain critical American values such as entrepreneurialism." To date the foundation as donated over $150 million to nonprofits, including a $27 million grant to the Susan G. Komen Breast Cancer Foundation "in support of efforts to reduce racial disparities in breast cancer mortality rates," noting that at present Black women are almost 40 percent more likely to die of breast cancer than White women.

Apropos of Smith's creativity in finding ways to help level the playing field for African-Americans, the Fund II Foundation went beyond giving money late last year when it launched InternX, a digital platform designed to help people of color obtain the same access to job opportunities as enjoyed by their wealthier White peers, a change that Smith says will benefit society as a whole. "[... I]f America is going to remain competitive in the global economy age of the digital disruption, business and academia must collaborate on engaging the best and brightest talent from underrepresented communities of color," he said during the InternX launch announcement in October 2018.

“We are only bound by the limits of our own conviction,” Smith told students at American University in 2015. “We can transcend the script of a pre-defined story, and pave the way for the future that we design. We just need to tap that power, that conviction, that determination within us.”

If it wasn't then, surely these last four years have proven Smith to be a man who practices what he preaches.

 

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Last Updated : Tuesday, June 25, 2019