Netflix CEO Reed Hastings speaking at the Mobile World Congress in Barcelona. catwalker/shutterstock
Netflix CEO Reed Hastings speaking at the Mobile World Congress in Barcelona. catwalker/shutterstock

On May 19, I wondered if other funders would follow the lead of the Andrew W. Mellon Foundation and support historically black colleges and universities disproportionately impacted by the coronavirus crisis. Marybeth Gasman, professor of education at Rutgers University, wasn’t optimistic. “Some big donors and foundations give to HBCUs, but not in a way that will help them survive the crisis,” she said.

Gasman’s prediction held until May 25, when George Floyd was killed by police during an arrest for allegedly using a counterfeit bill. The deaths of Floyd, Breonna Taylor and others at the hands of police have set off a historic national reckoning with racial injustice ever since.

A few days ago, Netflix founder Reed Hastings and wife, philanthropist Patty Quillin, announced a $120 million commitment to be distributed equally between Spelman and Morehouse Colleges and the United Negro College Fund (UNCF). The couple said they initially had plans to give $1 million each to each school, but Floyd’s killing and the outrage that followed were “the straw that broke the camel’s back, I think, for the size of the donation,” Hastings told the New York Times’ Andrew Ross Sorkin.

The Giving Pledge signatories’ gift is the largest ever earmarked for scholarships at HBCUs, and the single biggest donation by a couple or an individual toward racial justice in the aftermath of Floyd’s death.

Here are six quick takeaways from this historic gift, which came a few days after Netflix itself announced a $5 million commitment to causes supporting the black community.

1. It’s the Next Logical Step for Hastings and Quillin

Education has been a huge priority area for Quillin and Hastings, whose net worth stands at $5.3 billion. In 2016, the couple launched the $100 million Hastings Fund, through the Silicon Valley Community Foundation, to “partner with communities to significantly increase the number of students who have access to rich and holistic educational experiences.” The fund launched with two initial grantees, the Hispanic Foundation of Silicon Valley, and in a preview of what was to come, the UNCF, with the aim of providing students of color “exceptional post-secondary educational experiences.”

By centering on college scholarships, the commitment marked an intriguing shift in giving from a couple best known for supporting K-12 reform and charter schools, prompting my colleague Ade Adeniji to wonder if Hastings would “start to think more broadly about his approach to education.”

A year later, we received an answer when Hastings made a $5 million gift to his alma mater, Bowdoin College, to fund a program called THRIVE, to “substantially transform the college experience and improve the graduation rates of low-income students, first-generation students and those students traditionally underrepresented on college campuses.”

2. The Gift Was Years in the Making

“Generally, white capital flows to predominantly white institutions, perpetuating capital isolation,” Hastings and Quillin stated upon announcing the HBCU gift. One reason for this is the fact that HBCUs don’t have the same deep bench of well-connected and affluent alumni that collectively give billions to the Ivies and big state schools.

“The reality is that our alumni have done quite well. But I don’t think we have billionaires,” said David A. Thomas, president of Morehouse. Referring to Harvard Business School, where he previously taught, and Georgetown University’s business school, where he was dean, Thomas said, “There, you had much more wealth within the alumni base, so you don’t have to go out as much.”

So how did Morehouse, Spelman and the UNCF, which funds scholarships for 37 HBCUs, net these massive gifts?

The answer involves Hastings’ relationship with UNCF president Michael Lomax. Roughly 10 years ago, Hastings and Lomax both served on the board of the Knowledge Is Power Program (KIPP), one of the largest and best-known charter school chains in the country. In this capacity, Hastings saw how many charter school students couldn’t afford to attend an HBCU. According to the Atlanta Journal-Constitution’s Ty Tagami, it was around this time the couple first gave the UNCF $100,000.

The couple’s Hastings Fund went on to support the UNCF in 2016. Last year, Lomax gave Hastings and Quillin a tour of HBCU campuses in the Atlanta area. After visiting Spelman and Morehouse, Hastings and Quillin decided to give $1 million a year to each of them and the UNCF.

“Then, George Floyd died, and everything changed,” wrote Tagami. “The second $1 million installment had already been paid when, on June 7, the couple sent Lomax an email saying they had decided to give $20 million to each college and to the UNCF. Two days later, Lomax awoke at 3 a.m. to another email from Quillin: The couple wanted to double the amount.”

3. The Couple Hopes the Gift Spurs More Support

The Hastings/Quillin gift underscores the yawning gaps in wealth between HBCUs and other universities. Spelman’s endowment is $390 million; Morehouse’s is $145 million; UNCF’s is $100 million. “We’ve done as much as any small liberal arts college in the country, and most of those colleges have 10 times the endowment that Morehouse has,” Thomas told the AJC.

Thomas told the Times that Morehouse will use the gift as a springboard to expand its donor base by cultivating new relationships with people who may not have been aware of the school or HBCUs overall. His ultimate goal is to raise enough money so Morehouse can admit students without considering their family’s economic status. To reach this point of “need blindness,” he estimates they’d require an endowment of roughly $1.2 billion.

Lomax said the UNCF hopes to raise $1 billion to combat the effects of COVID-19. They’re currently at $60 million, he told the Times, with $40 million from Hastings and Quillin, meaning they need almost 20 times that amount.

Hastings echoed that sentiment, telling “CBS This Morning,” “as wonderful as this gift is, it’s a drop in the bucket compared to the need.” Fortunately, Lomax said the money is already stirring interest from other donors.

The couple hopes their gift will specifically compel white donors to step up. In his conversations with Lomax, the UNCF president attributed HBCUs’ lack of support to “social [isolation]. So white people generally give to predominantly white institutions. It’s natural, but it’s not healthy.”

Lomax told him, “‘We need to do a better job of kind of getting to know each other and cross-investing,’” Hastings recalled to the Los Angeles Times.

4. There’s Potential for Real Impact

One analog to the Hastings/Quillin mega-gift is Michael Bloomberg’s $1.8 billion Johns Hopkins University commitment, as both gifts found billionaires digging deep for financial aid. But the similarities end there. For starters, Bloomberg, unlike Hastings and Quillin, attended the recipient institution.

Moreover, if the aim here is to boost access and drive economic mobility, the Hastings and Quillin gift has the potential to move the dial more effectively than Bloomberg’s much larger commitment.

Bloomberg’s gift was earmarked for financial aid to help Hopkins raise its share of Pell Grant students to at least 20% by 2023. Back-of-the-envelope calculations suggest that the gift would ultimately provide scholarships for approximately 66 Pell Grant students over five years. This is why many commentators concerned with “impact at scale” called Bloomberg’s gift, for all its good intentions, a “wasted opportunity.”

Contrast this with the recipients of the Hastings/Quillin gift. Sixty percent of Spelman students and 48% percent of Morehouse students are Pell Grant-eligible. And Hastings and Quillin’s money will also go a lot further than Bloomberg’s will at Hopkins, where tuition plus room and board tops off at $72,000 per year.

The math doesn’t lie: At a fraction of the amount of Bloomberg’s gift, the couple’s $120 commitment will give at least 400 incoming students over the next decade—20 a year at each school—full-ride scholarships.

5. There are Concerns about “The Usual Suspects”

The gift generated some pushback across the Twitterverse. American Federation of Teachers President and vocal charter school opponent Randi Weingarten tweeted, “Notice… he doesn’t help educators.. he does this.. [sic] Why isn’t @reedhastings trying to use his fortune to help us fund public schools or help pass the #HeroesAct.”

Perhaps the most salient line of criticism, however muted, came from HBCU proponents themselves. While Spelman and Morehouse’s endowments are relatively small, they still dwarf the median endowments of HBCUs ($15.7 million) and non-HBCUs ($36.8 million), for that matter.

Both schools have formidable fundraising operations. In 2018, Spelman received a $30 million gift from Ronda Stryker and William Johnson. Prior to the Hastings/Quillin commitment, it was the largest gift ever earmarked for an HBCU. In May, businessman Frank Baker and his wife Laura Day Baker gave the school $1 million to pay for the existing spring tuition balances of nearly 50 members of Spelman’s 2020 graduating class. At 35%, its alumni giving rate exceeds that of the average university, which hovers around 12%.

In 2019, Robert F. Smith famously pledged to pay off approximately $34 million in student loans for Morehouse’s graduating class. Soon after, the school netted a $13 million donation from Oprah Winfrey, bringing her total giving to the school to $25 million. And this January, it received a $1 million gift from former American Express CEO and chairman Kenneth Chenault and his wife Kathryn.

Speaking to the AJC’s Tagami, entertainment executive and Clark Atlanta graduate Jamal Coleman said “Giving in general just seems to go to two or three institutions,” referring to Spelman, Morehouse and Howard University, which has a $693 million endowment and received $10 million from the Karsh Family Foundation to endow its STEM program earlier this year.

Coleman said he appreciates that Quillin and Hastings acknowledged the importance of black colleges and universities, “but it’s also important to dig a little bit deeper than what’s known on the surface.”

6. It Opens the Door for Tech Donors Concerned About Equity

Coleman has a point, and so one big question moving forward is whether donors will ramp up support for some of the smaller HBCUs that have also been devastated by COVID-19. The Hastings/Quillin gift provides some cause for optimism, as a third of the sum will go to the UNCF, which will allocate 20 scholarships to students, most of whom, presumably, will not attend Morehouse or Spelman.

Hastings and Quillin are also taking messaging cues—consciously or otherwise—from Bloomberg, who, upon announcing his gift to Hopkins in 2018, said, “We need more graduates to direct their alumni giving to financial aid.” While Hopkins may not have been the ideal recipient for a gift focused on bending the mobility curve, Bloomberg’s billions, at the very least, changed the conversation by pushing affluent donors and their elite alma maters to strengthen their support for first-generation and low-income students.

Hastings and Quillin’s gift may have a similar effect at a time when tech billionaires are grappling with ways to address systemic inequities in the wake of Floyd’s murder and the calls for action that followed. Hastings told the New York Times he hoped that the donation would lead other wealthy individuals to give to HBCUs. “I think white people in our nation need to accept that it’s a collective responsibility.”

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