Nonprofit gives black students key financial skills
Harvard University junior Angel Onuoha spent his adolescence anticipating a career as a doctor. He worked hard, skipped two grades, and was poised to receive acceptance letters from prestigious premed programs.
But the life plan his mother carved out for him never came to fruition. Instead of getting ready to scrub up, Onuoha has cofounded an education-focused, nonprofit capital management firm called BLK Capital Management Corp.
After noticing a lack of people of color during his 2017 summer internship at a New York City investment bank, Onuoha, along with Harvard junior Drew Tucker and Princeton University junior Menelik Graham, decided to start an organization focused on managing a long-short equity portfolio and teaching black students about the world of finance. The trio opened a rolling application and soon started raising capital with 30 Ivy league members.
BLK gives its members — black college students from across the country that it calls analysts — a chance to research and pitch promising stocks for the firm to invest in. Big banks such as Goldman Sachs and Morgan Stanley have sponsored the fund’s small pot of gold — $100,000 — but Onuoha says it’s about more than money. The real-life investment experience teaches members valuable skills that they may not get in their early college courses, he said. Harvard alumni serve as mentors, but students who make it through the three-step application process fill all positions at BLK, right up to Onuoha as chief executive.
Earlier this month, the firm’s 160 analysts decided to invest 7 percent of its fund in Garrett Motion, an automotive technology spinoff of manufacturing conglomerate Honeywell. The move came after students pitched prospective companies in a competition, during the organization’s second conference at Morgan Stanley’s New York City office.
Onuoha said he wants to give marginalized individuals access to high-paying jobs in the finance industry that often exclude people of color and women.
Harvard alumnus Eric Taylor, founder of financial technology company Trident, says that despite some progress, minority hires still struggle to rise to high-paying leadership roles at companies. Such opportunities often go to students with connections in finance who come into college with a better understanding of the industry, he said.
“If you sit across the table from someone at Thanksgiving every year for 15 years and they work at Goldman [Sachs], you’re going to learn something,” said Taylor, who serves as a mentor for BLK. “If they know about an internship opportunity, you’re going to hear about it.”
Onuoha, 19, said a conversation with his brother convinced him to pursue something he was passionate about. It wasn’t medicine.
“When I look back I would absolutely not expect that I would be studying economics or in finance at all,” he said. “A lot of minorities similar to me don’t know anyone in the financial industry. There’s just not a lot of information or opportunity around that space.”
Taylor said BLK stands out from similar financial organizations not only because of its mission to increase financial literacy, but also because it makes students responsible for clients’ money.
In addition to buying and selling stocks, BLK students participate in a six-month education program to learn investing fundamentals. They complete readings, submit assignments, and convene for a virtual conference every Sunday.
“Students on my campus often times just think of investment banking; I credit BLK with introducing me to other divisions,” said Morgan Ogryzek, the organization’s chief marketing officer and a Harvard sophomore.
“Whether I end up pursuing finance or I don’t, just to see someone [who looks like me] in a position of power is so important,” Ogryzek said.
By giving black students key financial skills and experiences, BLK targets a vital need for the investment industry, said Jonathan Jones, head of investment talent development for Stamford, Conn.-based hedge fund Point72 Asset Management, which signed on as a founding sponsor in March.
“You can make an argument that one of the biggest challenges facing the hedge fund industry is sameness, people from similar backgrounds producing investment ideas that are too similar,” he said. “Difference makes a difference.”
Onuoha says the firm is looking to invest more of its capital, but he’s more excited to see BLK analysts graduate college and enter the industry.
“Not only are we connecting our students to jobs and internships,” he said, “we’re also going to be able to talk to [BLK] alumni who can speak to the values and network that they’ve gained from it.”