Mellody Hobson, an American investor, businesswoman, and financial educator, emerged from poverty with a mission to succeed and aid others in better money management. From a young age, she grasped financial stability’s significance. Throughout her distinguished career, she has shared this knowledge, aiming to spare other families the insecurity and anxiety that marked her childhood.
Early Life and Financial Awakening
The youngest of six children, Hobson grew up with a single mother; her father left before she was born. Her path to finance began amid childhood financial struggles. Witnessing her mother’s poor financial decisions, which led to frequent evictions, disconnected phones, and power outages, deeply affected her. This adversity fueled Hobson’s drive for financial security and freedom, steering her away from fiscal missteps and toward global recognition as a thought leader.
A Journey Toward Financial Freedom
Hobson’s drive for financial independence steered her toward frugality. Even though she was brilliant, her family could not afford to pay her tuition fee to study at Princeton. Despite this, Hobson was resolute in her pursuit of education because she believed it was her way out of poverty. She eventually borrowed money to study at Princeton. After graduating and joining Ariel Investments in Chicago, she continued to live on her initial salary despite earning more. Rather than upgrading her lifestyle, she focused on paying off her student loans and purchasing her first apartment, which cost $155,000. Hobson cleared her student loans in just a few years, marking the start of her journey toward financial independence.
Another tactic she employed was calculating her daily earnings. This perspective helped her assess purchases regarding the work required to afford them, enhancing her understanding of the effort needed for each acquisition.
On her path to financial freedom, Hobson consistently increased her 401(k) contributions with each raise, setting a target date to maximize her 401(k) contributions annually.
Hobson’s careful financial strategies and dedication to teaching others the same have made her a prominent figure in global finance. Known for her expertise in financial services, she has been recognized for advancing financial literacy and inclusion. She regularly discusses financial topics on “CBS This Morning” and was a spokesperson for the annual Ariel-Schwab Black Investor Survey. Hobson has contributed to financial segments on “Good Morning America,” offers weekly money tips on the “Tom Joyner Morning Show,” and writes a column for Black Enterprise magazine.
In May 2009, Hobson created and hosted an ABC show titled “Unbroke: What You Need to Know About Money,” featuring celebrities such as the Jonas Brothers, Oscar the Grouch, and Samuel L. Jackson.
Career Milestones and Achievements
Hobson interned at Ariel Capital Management and T. Rowe Price Associates in college, both investment firms. After graduating from Princeton, she joined Ariel Investments in Chicago, Illinois, as an intern, focusing on client service and strategic planning. Ariel Investments, with offices in New York City and Sydney, Australia, manages $16.8 billion in assets, including retirement plans, college savings accounts, and personal investment accounts. The firm emphasizes making investing accessible to all, allowing individuals to invest as little as $1,000 in its mutual funds.
Hobson advanced to become the firm’s senior vice president and director of marketing. In 2000, she was named president, a position she held for nearly two decades. In 2019, she became co-CEO of Ariel Investments, overseeing the firm’s business operations, development, and strategic initiatives. In 2023, Ariel Investments raised $1.45 Billion for its debut private equity fund
Hobson was drawn to Ariel Investments because of its founder, John Rogers. She saw in Rogers a source of the knowledge she sought for long-term financial security. Additionally, Ariel’s status as the nation’s first Black-owned money management firm was a significant factor in her decision to work there.
Leadership Roles and Corporate Influence
Throughout her distinguished career, Hobson has been a pioneer in promoting diversity in boardrooms and business leadership roles. In 2017, she became the first African-American woman to lead the Economic Club of Chicago. In 2020, she was appointed chair of the board of directors of Starbucks, establishing her as one of the most prominent corporate directors in the U.S. Also in 2020, Forbes ranked her 94th on its list of the world’s most powerful women.
Hobson also serves on several boards, including those of JPMorgan Chase & Co., the Chicago Public Education Fund, the Lucas Museum of Narrative Art, and the Sundance Institute. She formerly served on the board of The Estée Lauder Companies, Inc. Her past directorships include The Estée Lauder Companies, Inc., from 2005 to 2018, and DreamWorks Animation SKG, Inc., from 2004 to 2016.
Recognition and Contribution to Society
Hobson has earned recognition on several prestigious lists, including Time magazine’s 2015 list of the 100 most influential people in the world, Ebony magazine’s “20 under 30” in 1992, the World Economic Forum’s “Global Leaders of Tomorrow” in 2001, Esquire’s “America’s Best and Brightest” in 2002, and The Wall Street Journal’s “50 Women to Watch” in 2004.
In October 2020, Hobson made a significant donation to Princeton University, her alma mater, for the establishment of a new residential college. Originally named for President Woodrow Wilson, the college will be the first at Princeton named after a Black woman.
In an interview with Harper’s Bazaar, Hobson discussed the challenges she has faced in her career. “Throughout my career, I’ve been consistently underestimated because of my race and gender, but that underestimation has fueled me,” she said. Hobson cited a motivating quote: “Are you bitter or better?” She emphasized her commitment to excellence and acknowledged the pain and anguish she has experienced. “There’s a bigger task at hand, which is helping others overcome it too,” she added.
Hobson also spoke about her focus on creating opportunities for others. “Ariel is a symbol, and I need that symbol to be successful so that maybe others will want to be in the business we’re in,” she said. “They’ll see us and say, ‘They did it; I can do it.’ I want to make sure that wherever I am, I share power.”