Babson College expects a ripple effect in fundraising and enrollment after alumnus Arthur Blank, co-founder of Home Depot, donated $50 million to its leadership school.
The grant will establish the Arthur M. Blank School for Entrepreneurial Leadership at the Wellesley, Massachusetts, private, not-for-profit college 17 miles west of Boston, which is capping its centennial year.
“We selected Babson for the largest grant we have ever given since 1995 when we started our foundation, not really because I went to college there, but because Babson has earned it,” said
“Couldn’t think of a better partner than Babson College. I look forward to being on campus, and spending some time with students and working with them.”
According to college president Stephen Spinelli, the gift from Blank, who owns the National Football League’s Atlanta Falcons and Major League Soccer’s Atlanta United, further validates the accomplishments at his school, whose numbers are bucking negative trends nationally and within Massachusetts while operating in one of the country’s most competitive college markets.
Spinelli said the school has raised a further $21 million and estimated that enrollment applications have increased around 12%.
“People want to give to a winner,” said Spinelli, who became the college’s 14th president on Jan. 1.
Babson enrolled 3,084 full-time equivalent students as of fall 2018. According to Moody’s Investors Service, the school generated operating revenue of $221 million in FY18.
The school originated on Sept. 3, 1919 as the Babson Institute with 27 students. It held its first classes in the former home of Roger and Grace Babson on Abbott Road in Wellesley Hills. Roger Babson, which emphasized a business environment, combined class time with actual workforce training, while faculty consisted of veteran business leaders.
“Babson College's credit strengths include healthy undergraduate student demand and improved fundraising in conjunction with a comprehensive campaign, driving consistently positive operating performance,” Moody’s said in an October commentary.
Also, said Moody’s, Babson’s appeal to international students continues to increase, counter to the national trend. Moody’s rates Babson A2 with a stable outlook.
The school’s business leadership focus is a magnet, Spinelli said in an interview.
“That what makes Babson unique. Once you graduate from college — and I tell this to my son, who’s a music major — every person is a business major,” he said. “What is my income? How do I create value?”
Moody’s A2 rating also incorporates college's small size and high reliance on student charges and market niche in business education.
Babson has thrived amid choppy sailing for many Massachusetts colleges.
A rash of abrupt small-college closures, part of a nationwide trend, prompted Gov. Charlie Baker and state lawmakers to enact stress-testing and early warning legislation in November requiring increased financial disclosure for all colleges and universities throughout the commonwealth.
“We’re worried that our delivery systems aren’t meeting the demand, so we have to change our delivery systems,” Spinelli said of higher education in general.
Spinelli co-founded oil-change company Jiffy Lube International and was later president of Philadelphia University, then became chancellor of Thomas Jefferson University following its merger with Philadelphia. Babson inducted him into its Alumni Entrepreneur Hall of Fame in 2011.
He cited a study by Brown University — “not a business-friendly school” — that ranked Babson first in Massachusetts and seventh nationally in mobility among lower-income students.
“The Blank contribution underscores Babson’s success in this new, disruptive higher education environment,” said Katherine Craven, Babson’s chief administrative and financial officer since 2014.
“It’s a transformational gift for Babson and for higher education. We’re so excited about our business model.”
The Harvard-educated Craven, a former commonwealth first deputy treasurer who early in her career ran point on the state budget under then-House Speaker Thomas Finneran, was chief executive of the Massachusetts School Building Authority from 2004 to 2011, where she overhauled a debt-and-patronage-riddled financing operation.
Later she was assistant vice president for capital finance for the University of Massachusetts and executive director of the UMass Building Authority.
Baker in March appointed her chairwoman of the Massachusetts Board of Elementary and Secondary Education.
The partnership between Babson and the Blank Family Foundation will provide need-based scholarships to increase access and affordability for promising entrepreneurial leaders who otherwise could not afford college, the school said.
It will also cover a newly endowed faculty position, the Blank chair in values-based entrepreneurial leadership; new experiential opportunities where learners will problem solve in rapidly changing, technology-driven conditions; and an “entrepreneurial village,” a dedicated campus space for collaboration.
It also includes enhanced access to Babson’s entrepreneurial centers and institutes, including co-curricular activities and global networks; and funding for applied research.
Spinelli has spent the past year meeting with students and faculty, and expects board approval on a new strategic plan for the college. He said his Babson experience is a big plus.
“A lot of presidents have to fight to get a meeting,” he said. “I didn’t have to fight for a meeting. I was welcomed as part of an exciting community.”
As a Babson undergraduate, Blank, now 77, ran a landscaping business and a laundry pickup service. He graduated in three years. According to Spinelli, Blank, a native of New York City’s Queens borough, is as thorough and demanding as he is generous.
He and Bernie Marcus founded Home Depot in 1978 after losing their jobs at a regional hardware store. Forbes has estimated his net worth at $5.3 billion.
“He is a world-class philanthropist,” Spinelli said. “He will never be rude to you, but he won’t give you the money unless there’s a return. You had better articulate your plan.
“He has transformed the home products business and has been a major force in Major League Soccer. And he has had a big impact on the National Football League.”
