It’s rare that private equity magnates like Marc Rowan, Howard Marks, Bruce Karsh and Michael Arougheti sit around a conference table — or, as it were in the past 18 months, join a conference call — in the spirit of collaboration.
The billionaire and millionaire investors are usually leading their own alternative finance firms, Apollo Global Management (NYSE: APO), Ares Management Corporation (NYSE: ARES) and Oaktree Capital Management (NYSE: OAKA), in competition with each other.
But a year ago, the leaders put that aside and talked through a problem they all felt responsible to address: a glaring lack of inclusion and support for people of color in an industry marked by power, wealth and long-standing networks.
Through a series of weekly phone calls, the four turned an idea into a foundation, and called on more teams from their firm to jump in. AltFinance was created as a decade-long, $90 million commitment, in which the three firms will each invest $3 million per year into Howard University, as well as three other historically Black colleges and universities in Atlanta: Clark Atlanta University, Spelman College and Morehouse College.
"I've always said, 'Mind once expanded will never contract,'" said Jonathan Simon, Apollo's head of diversity, equity and inclusion and leadership development and an advisory board member for Howard's School of Business honors program, in an interview. "We are keeping the student at the center."
The trio's newly formed Alt Finance Corp. nonprofit will determine its headquarters location and first executive director later this summer. Eventually, they said, the goal is to scale up the virtual institute to offer it to all 106 HBCU institutions, which also include Bowie State University and the University of the District of Columbia locally.
“From the very beginning, we wanted this to be truly transformative, knowing that we could do so much together and this is bigger than any of our firms individually,” said Jerilyn McAniff, Oaktree’s global head of diversity and inclusion, who will be one of the firm’s board members, in an interview. “Our vision was to really put something in place that is sustainable, that will benefit the entire industry.”
The new nonprofit's mission is three-pronged, focusing on education, mentorship and scholarship, with plans to launch its first cohort of sophomore students this fall. University of Pennsylvania's The Wharton School will design a curriculum open to students at the four institutions to enroll in online courses.
Bethesda-based Management Leadership for Tomorrow, a national nonprofit that seeks to empower Black, Latinx and Indigenous people for work and leadership in corporate America, will oversee the fellowship program. That will include leadership training, technical skills for job interviews, and an immersion in the nitty-gritty of different alternative investment sectors, such as private equity, real estate, infrastructure and even antiques. Students will also be paired with a mentor from one of the three firms.
Some of the funding will also cover scholarships for students who might otherwise graduate with debt or be weighed down by other financial needs.
“We know how every university, every institution, the way they think through their students and the classes they take each year — they’re different from school to school,” McAniff said. “We didn’t want to just build something and present it to them and say here you go.”
Simon recounted AltFinance's origin story as one devised to sustainably support Black finance leaders — before they get to their first job interview, or even take their first finance class.
"At the end of the day for all of us, this was about, 'How do we have generational impact?'" he said. "We wanted to be ambitious. This is not a flash in the pan — it's not a scholarship we're just announcing, it's not just an internship. We really wanted to do something that would be transformational, and I think what we wanted to signal to the institutions is that we were committed."
Supporting HBCUs is something Simon is keenly passionate about, as a finance alum of Morehouse College himself and someone who has used his various roles in the financial services industry to give back.
His grandmother also attended Spelman College and his wife graduated from Clark Atlanta University. Simon led HBCU strategy at JPMorgan Chase & Co. before he joined New York-based Apollo last August.
"I have a long history of supporting not only my alma mater but other HBCUs," Simon said. "It really is important to me."
This article has been updated to correct the name of Clark Atlanta University.
