(CNN) -- Morehouse College seniors got a surprise Sunday when billionaire investor Robert F. Smith announced during his commencement speech that he would pay off the student loan debt for the historically black college's graduating class.
"My family is going to create a grant to eliminate your student loans," he told the newly minted graduates in Atlanta.
The sum among the more than 300 students adds up to about $40 million, Morehouse spokeswoman Aileen Dodd told CNN.
Smith on Sunday also received an honorary degree, along with actor Angela Bassett and psychologist Edmund Gordon.
The entrepreneur, founder of the investment firm Vista Equity Partners, is worth about $5 billion, according to Forbes.
The 56-year-old was a chemical engineer for Goodyear and Kraft before attending business school. He worked for Goldman Sachs, specializing in technology investments, before starting Vista Equity in 2000.
Vista Equity invests solely in software, data, and technology companies and boasts capital commitments of $46 billion, the company's website says.
Smith has quite the generous streak. In 2016, Cornell University, one of his alma maters, renamed its chemical and biomolecular engineering school in honor of the Austin, Texas, investor after he committed to donating $50 million to the school. He's also donated millions to cancer research and the arts.
His Fund II Foundation provides grants under five pillars: preserving the African-American experience, safeguarding human rights, conserving the environment, providing music education and sustaining "critical American values such as entrepreneurialism," the organization says.
In 2017, Smith signed the Giving Pledge, an effort spearheaded by billionaires Warren Buffett and Bill and Melinda Gates to convince wealthy Americans to give away half of their fortunes.
In signing the pledge, Smith said he would focus on causes that support equality for black Americans and the environment. His wife, model Hope Dworaczyk Smith, will focus on helping children, he wrote.
"I will never forget that my path was paved by my parents, grandparents and generations of African-Americans whose names I will never know," Smith said. "Their struggles, their courage, and their progress allowed me to strive and achieve. My story would only be possible in America, and it is incumbent on all of us to pay this inheritance forward."