47. How to Set Up a Scholarship

Here’s this week’s letter:
I was just watching a video of billionaire Robert Smith giving a commencement speech at Morehouse and then surprising the graduates at the end by announcing that he is paying off their student loans. I watched the video three times, the looks on those students’ faces was something I’ll never forget. They looked so surprised and then elated and it just really was an amazing moment. So. I’m not a billionaire, but I am a thousandaire. And I want to know if I could do something like that too. Any ideas?

Thanks for sending in your letter, I’ve seen that video too! I also watched it multiple times. The students just seemed so stunned. Honestly, I remember being so wired and yet exhausted when I graduated from college that I’m not sure I would have been able to process exactly what he was saying. But yes, Robert Smith, I want to say he made his money doing private equity, but don’t quote me on that. In fact, I was just reading about a month ago that he is now starting a scholarship at his alma mater Cornell for underrepresented students in engineering. He is giving $15M towards that scholarship.

And that’s the direction I was thinking for you. You mentioned paying off student loans for others, but let me know what you’re hearing, many many people with student loans that I follow online are saying that they are pausing contributions in hopes that the government is going to write them off. As for me, I dunno, maybe I’m not as optimistic, I’m still making the monthly payments. You could try to identify people to help them with their student loans, but I dunno, the path to helping students avoid future debt is more clear to me.

There are a few ways you can set up a scholarship fund. You can contact a school and work with them to set it up. They’re going to work with you to figure out what students you want to help- maybe you are focusing on a particular hometown or particular student identity. You might be focused on a particular field of study. The school will help you think through all of that. And then of course, the amount of money that you want to put into the scholarship fund. From my preliminary research, it seems like, if you want to give an annual scholarship that gives $1,000 you will need to be ready or have a plan to give the university or college about $20,000 or $25,000. I’m going to link a Kiplinger article that gives the example of San Diego State University, for example, requires $50,000 to endow a $2,000 annual scholarship. Or let’s say you don’t have the money all at once, or you can commit to giving $5,000 a year over three years to finance three $5,000 scholarships for one year.

After you figure out the scholarship amount and the focus, then the school will work with you to figure out selection criteria and your level of involvement in picking who gets the scholarship.

That’s the more traditional way of setting up a scholarship fund that I am aware of. But in researching your question, I’m seeing that there is another route that is available, working with a scholarship manager rather than directly with a school.

The specific one that I have been studying is called bold dot org. You can set up a scholarship on your own or you can set up a scholarship fund so that you can crowdsource enough money to create the scholarship and then it is exactly what you’d expect for a tech solution to this challenge. Donors set up the scholarship, again you can fund it yourself or crowdsource it, then students create profiles and apply for the scholarships, but there’s a heavy social media aspect to it. Students who are using this platform have profiles with their photos and essays that they have submitted for each scholarship. They have a LinkedIn style resume. They also have high level information relating to their school finances. So, how much is their tuition. How much are they paying? How much are their parents paying, if any? How much are they getting in grants and loans. There’s also a list of their interests and goals.

Two things jumped out at me, actually three. I really liked that you could reach, presumably a lot more students by using their platform rather than trying to somehow create and advertise a scholarship on your own. I liked that you wouldn’t have to limit your scholarship to a particular school. For example, I saw a scholarship on bold dot org that any Native American woman can apply for who wants to study anything at any school. There’s something to that. So that’s the first thing, there’s a potentially wide reach for this site.

Maybe it’s the geriatric millennial in me, but I did find myself surprised at just how much personal information these students were being required to divulge online. I’m not even a registered user of the site and I was able to access student profiles that I just didn’t quite expect. One of the student profiles I was looking at was for a high school sophomore that has been applying to various scholarships.

And then the last thing that I noticed was that the social media aspect of it made it feel like the students were being made to present in such a social media type way that I just wondered about students who don’t present well in this type of platform. A couple of months ago there was an episode on this show called Etsy for Ukraine, that was episode # 35 and there was a discussion about the Ukrainian vendors on Etsy and Ebay and Airbnb who were receiving bookings from Americans who wanted to somehow transfer money directly to people who need it. And I understand this instinctual need that many of us feel to connect with a specific human and to help them, rather than writing a check to a big faceless organization. I very much get the desire to cut out the middle man and give directly, but in that discussion I couldn’t help but wonder about the Ukrainians who don’t present well on Etsy or Ebay or Airbnb for whatever reason, language limitations, they don’t have the right photos, they just don’t have that “it” factor that makes people pop online. Or maybe they aren’t online at all for one reason or another.

Something about seeing these students with their ring light camera photos kind of reminded me of that feeling. I dunno. I’d be curious to hear from you all about what you think. Are young people nowadays just born social media ready? Is that a requirement to get into school or get a job nowadays? Do you think this aspect of the scholarship platform will hold some students back?

Anyway, I’m here to present thoughts and options. So I do want to encourage you to check out a scholarship manager like bold dot org and decide for yourself what you think.

Either way, I love the idea of helping students avoid student loan debt. It is a huge issue. For some students it is an inconvenience, for many many other students it is a real burden, sometimes it is a crisis. I can’t wait to hear what you decide to do, check back in.

https://www.kiplinger.com/article/college/t042-c001-s003-setting-up-a-scholarship-fund.html
https://bold.org/

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