How a $90M HBCU investment is paying big dividends for Atlanta students

The AltFinance program began two years ago at Clark Atlanta, Howard, Morehouse and Spelman
Kareem Michel, an economics major at Morehouse, poses for a portrait during the Morehouse College commencement ceremony on Sunday, May 21, 2023, on Century Campus in Atlanta. Michel is part of AltFinance's first cohort to graduate. CHRISTINA MATACOTTA FOR THE ATLANTA JOURNAL-CONSTITUTION

Kareem Michel, an economics major at Morehouse, poses for a portrait during the Morehouse College commencement ceremony on Sunday, May 21, 2023, on Century Campus in Atlanta. Michel is part of AltFinance's first cohort to graduate. CHRISTINA MATACOTTA FOR THE ATLANTA JOURNAL-CONSTITUTION

Kareem Michel has had an itch to work and earn money since he was a kid. Born in Haiti, he moved at the age of 4 to Marietta, where his father drives for Uber and his mother runs a cleaning business.

When he was younger, Michel used to save the money he got as presents and sell water bottles on the corner. Now, the new Morehouse College graduate is moving to Los Angeles to work in private equity — a dream he achieved thanks to a multimillion-dollar program.

In June 2021, three investment firms banded together to launch the $90 million AltFinance project to open more pathways for students from Historically Black Colleges and Universities to enter the alternative investment industry.

Two years later, the fruits of that effort are starting to show through Michel and 13 other young men and women, the first group of students to go through the program and graduate.

“I think AltFinance really is where the bulk of my knowledge about the (alternative) industry overall came from,” Michel told The Atlanta Journal-Constitution. He said he was able to be exposed to an area of finance that is not often talked about, particularly in the Black communities where he comes from.

Kareem Michel, an economics major at Morehouse, poses for a portrait before his Morehouse College commencement ceremony Sunday, May 21, 2023, on Century Campus in Atlanta. Michel is part of AltFinance's first cohort to graduate. CHRISTINA MATACOTTA FOR THE ATLANTA JOURNAL-CONSTITUTION

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The graduates in this first AltFinance class are from Morehouse, Spelman College and Howard University. Before leaving school last month, all but one of the students had jobs lined up at alternatives firms, in consulting or investment banking. The fourteenth is going to graduate school.

The investment firms behind the initiative are Apollo Global Management, Ares Management (co-founded by Atlanta Hawks principal owner Tony Ressler), and Oaktree Capital Management. Each pledged to give $3 million a year for 10 years to fund the program, a contribution that represents less than 0.02% of their respective assets under management.

AltFinance initially launched at Clark Atlanta University, Howard, Morehouse and Spelman. It has since expanded to multiple other HBCUs across the country.

Education, exposure and experience

When most people think of investing, they likely think of traditional stocks and bonds. Alternative investments is everything outside of that, like private equity, real estate, hedge funds, venture capital and more.

Like most areas of finance, prospective candidates must have connections, study outside of the classroom and have real-world experience to get a foot in the door. And it’s all three of those things that AltFinance aims to provide.

“The playbook that we think about is one around co-curricular education, exposure and experience,” said Marcus Shaw, CEO and president of AltFinance.

AltFinance fellows get weekly virtual lessons on the finance industry, in-person workshops in different cities and a mentor from one of partner firms. They also participate in case studies, have access to merit and need-based scholarships, and get help preparing for interviews for internships and full-time jobs.

Shaw said less than 5% of the students had a real understanding of alternative investments when they joined AltFinance, which makes this level of training and support particularly important for HBCU students.

Alex Jenkins, one of the first AltFinance beneficiaries, graduated from  Spelman College in commencement ceremonies on Sunday, May 21, 2023, at the Georgia International Convention Center.  (Jenni Girtman for The Atlanta Journal-Constitution)

Credit: Jenni Girtman

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Credit: Jenni Girtman

“AltFinance is hands-down the best program that I’ve been a part of during my college career,” said Alex Jenkins, who graduated from Spelman in May with a degree in economics.

Next month, she will be joining an investment banking firm in New York, where she had interned before joining AltFinance. However, she said she only had a basic familiarity with alternatives before joining the program.

For Jenkins, “the support system that the program has is just outstanding,” from the mentors to AltFinance leadership and the rest of her cohort.

For Michel, AltFinance helped him network with the firm he will be working with before he even applied. Once he was in the interview process, he had help preparing. But one of the bigger takeaways for Michel is the confidence he built through the skills training.

The program has also had an impact on Atlanta’s HBCUs themselves. AltFinance has committed $500,000 each to the business and economic departments of Clark Atlanta, Howard, Morehouse and Spelman.

Beyond the funding to the schools, prospective students who are considering going into finance can see a robust program for alternative investments at the Atlanta University Center, which may sway them to attend, Shaw said.

Next fall, AltFinance will have more than 100 students across the partner HBCUs and the program will continue building on the lessons and wins from this first group of graduates.

“It gives me great comfort and excitement that we have proven the thesis in our very first cohort,” Shaw said.

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Assets under management of the three firms backing AltFinance, as of March 31:

Apollo Global Management: $598 billion

Ares Management: $360 billion

Oaktree Capital Management: $172 billion

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