Snap CEO Evan Spiegel and Miranda Kerr paid off art school graduates' student loans
As Sunday's commencement ceremony for the Otis College of Art and Design neared its end, graduates prepared to toss their caps and head out into the professional world. They would be armed with new degrees and, in many cases, saddled with student loans.
Some 77% of the student body identifies as people of color, and over 90% receive financial aid, according to the Los Angeles nonprofit institution. Its president, Charles Hirschhorn, acknowledged from the podium that while the college experience offers many gifts, it also comes at a cost.
"We know that for most of you and your families the shared burden of student debt is a heavy price that you paid for an exceptional Otis College education," he said. "We understand that this debt can compromise your future and limit your creative ambitions. We do not want to see this happen. We want to empower your imagination, your creativity and innovation."
And so, he announced, the school had one more gift for its soon-to-be-alums: It would pay off their outstanding debt.
That's thanks to a generous donation from commencement speakers — Evan Spiegel, the CEO of Snap Inc., and KORA Organics CEO Miranda Kerr, who have been married since 2017. They also received honorary doctorates at Sunday's ceremony, along with Queer Eye design expert Bobby Berk.
Spiegel took design classes at Otis during high school before matriculating to Stanford University, where he co-founded the social media company Snapchat in 2011 (four years later, he became the world's youngest billionaire). Bloomberg estimates the 31-year-old's current net worth to be about $5.05 billion.
Without specifying an amount, the school said in a statement that the donation from the Spiegel Family Fund is the largest in the college's history, and will "allow for the repayment of the outstanding student debt of students in the graduating Class of 2022."
That's 285 people, according to the Los Angeles Times, which also says the college's previous largest gift was $10 million.
As Hirschhorn broke the news, students cheered and leapt out of their seats for a lengthy standing ovation. When he eventually returned to his speech, his voice began to waver.
"People are crying, it's making me cry," he said as he laughed and wiped his face.
Hirschhorn explained that Otis had established two funds: One for full repayment of graduates' existing outstanding debt for loans certified by the college's financial aid office, and one to make charitable gifts to students graduating with similar educational loans secured outside of the college. He said students would get envelopes with more information on their way out of the ceremony.
The U.S. Department of Education scorecard puts the typical total debt for Otis undergraduate borrowers at $27,000 after graduation.
Both the donors and the school hope the debt relief will enable graduates to pursue their ambitions in the worlds of art and design, become leaders in the community and eventually pay it forward.
"It is a privilege for our family to give back and support the Class of 2022, and we hope this gift will empower graduates to pursue their passions, contribute to the world, and inspire humanity for years to come," Spiegel and Kerr said in a statement.
Several students, still in shock, told the Times that the surprise is lifting a huge weight off their shoulders as they begin their careers.
Farhan Fallahifiroozi, whose family emigrated from Iran in 2015, said they had been worried about the more than $60,000 in debt he took on to finance his degree, and that his mom cried upon hearing the news.
"I had so much debt," he said. "If it's really all gone, it puts me so much ahead."
The Biden administration has repeatedly extended the pause on student loan payments, most recently pushing the restart date until Sept. 1. The president is also facing growing pressure from Democrats to eliminate student debt altogether, especially in light of his campaign promise to cancel $10,000 in student debt per borrower.
And in the meantime, as NPR's Cory Turner reports,interest rates on student loans are about go up.
Spiegel and Kerr weren't the only donors hoping to offer some relief this graduation season.
To name a few other examples: Graduates at Wiley College in Marshall, Texas, had their debts cleared by an anonymous donor. And restaurateur Pinky Cole announced at the commencement ceremony of her alma mater, Clark Atlanta University, that she is gifting each of its more than 800 graduates their own limited liability company to kickstart their journeys as entrepreneurs.
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