Philanthropist Robert Smith took the podium at Morehouse College’s commencement ceremony to accept an honorary doctorate, but the billionaire investor surprised everyone during his speech when he bestowed his own gift to the Class of 2019.
Smith said he would pay off the student loans of the roughly 400 graduates.
"You have the power within to be great, be you, be unstoppable, be undeniable, and accomplish the things that people thought you never would," he told the crowd that gathered Sunday on the Atlanta campus of the all-male historically black college.
Smith urged the crowd to "treat all people with dignity even if you can't see how they're going to help you," and then made an announcement no one saw coming.
"This is my class, 2019. My family is making a grant to eliminate their student loans," he said to a stunned crowd.
"It was a moment of disbelief," said Morehouse graduate Ernest Holmes. "And then it went right into cheers and laughs and hugs and crying because, like, it really is going to change the lives of many students."
Smith said his only condition for the gift, which could be worth about $40 million, is that each student pay it forward.
"Let's make sure every class has the same opportunity going forward because we are enough to take care of our own community," he told students. "We are enough to ensure we have all the opportunities of the American Dream, and we will show it to each other through our actions and through our words and through our deeds."
Smith, an entrepreneur who founded the investment firm Vista Equity Partners, is worth an estimated $5 billion and considered the nation's richest black man. He made his decision to help graduates after speaking with some of them the day before his speech.
"Robert Smith essentially said to our students, 'I'm going to make you free to follow your passions,'" said Morehouse President David Thomas, who described Smith's act as a "liberation gift."
In Holmes' case, Smith's generosity will relieve him of $10,000 in school-related debt. The computer science and math major said he definitely plans to make the most of the opportunity.
"I want to inspire future men of Morehouse and I see this as a charge for me to make sure I truly give back," he said.
Smith's surprise gift makes a statement as the nation's student debt crisis reaches a climax. One in 5 adult Americans carry student loan debt, and more than a quarter of borrowers owe between $10,000 and $25,000. According to the Federal Reserve Bank of New York, the total amount of student loan debt was $1.47 trillion as of the end of 2018 — more than credit cards or auto loans.
The issue has a greater impact on students at historically black colleges and universities. A recent analysis by The Wall Street Journal found that graduates from historically black colleges and universities have 32% more federal debt than students of other public and nonprofit four-year schools.