Morehouse's commencement speaker shocks graduates by announcing he's paying off their loans

Robert F. Smith gave a commencement speech on Sunday that won't ever be forgotten by Morehouse College's Class of 2019.

The billionaire founder of investment firm Vista Equity Partners announced that he is creating a grant that will cover the cost of every single student loan held by all 396 graduating seniors. "On behalf of the eight generations of my family who have been in this country, we're going to put a little fuel in your bus," he said.

The graduates erupted in cheers and gave Smith a standing ovation. Morehouse President David A. Thomas told CNN Smith's "liberation gift" will cover about $40 million worth of loans. "When you have to service debt, the choices about what you can go do in the world are constrained," he said, adding that Smith's generosity "gives them the liberty to follow their dreams, their passions." Smith encouraged the graduates to pay it forward, so other students can benefit and "have all the opportunities of the American dream."

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After commencement, students — and their parents — were still in a daze. Graduate Elijah Nesly Dormeus is the first of nine siblings to graduate from college, and he told CNN that after his dad died when he was a kid, his mother sacrificed and worked hard to provide for her family. He has $90,000 in student loans, and his mother also took out a loan to help him. Smith's gift benefits both tremendously, and "all of her serving, all her giving was not in vain," Dormeus said. Catherine Garcia