Texas program is turning thousands of ex-cons into entrepreneurs

Inside the Texas-based Prison Entrepreneurship Program.

In May, it will be eight years since Charles Hearne made a mistake that sent him to prison for four years in Texas.

Two years later, an older gentleman told him he'd be making another big mistake if he didn't go through with an application to the Prison Entrepreneurship Program.

Hearne and 49 other prisoners, all dressed in white, showed up to a classroom where they learned more about a MBA-style program intended to teach them how to start a business once they were released from prison.

The major selling point for Hearne? The image of a black man, not unlike himself, walking across the stage upon graduating. Hearne, whose plans to attend college were cut short by imprisonment, was convinced.

"I knew I had to have this," he says.

Six years after having made that decision, he is Executive Relations Manager for PEP in Houston. Hearne is also on track to graduate in 2018 from the University of Houston with a bachelor's degree in business administration in finance.

The nine-month program changed his life.


PEP, an independent nonprofit, is run from two main facilities in Texas under the leadership of Bert Smith, a former investor who started volunteering for the program in 2005.

The people he met in the program were part of the reason he decided to stay involved. "I met men who were intelligent and very committed to changing their lives, very interesting and in many cases creative," he says. "I found myself taking insights and ideas that were helpful to me in my day job."

I met men who were intelligent and very committed to changing their lives.
Bert Smith

Inmates from almost all of Texas' 110 prisons can be eligible. Applicants go through a rigorous application process including a 20-page application and a series of interviews. Of those who are accepted, one-third are African-American and one-third are white. Thirty percent are Hispanic and three percent are mixed race.

Students spend three months on character assessment and development. Then, six months are dedicated to preparing a complete business plan, perfecting elevator pitches and presenting to a panel of business professionals, "Shark Tank"-fashion. Hearne proposed a sustainable paper business.

From an early stage, students are also expected to think of four attendees they would like to be present at their graduation in an effort to begin healing some relationships between inmates and members of their families.

Inside the Texas-based Prison Entrepreneurship Program.

"Everyone realizes PEP is not a handout. You have to put work in," Hearne says.

The hard work often pays off. On average, 60 percent of students graduate from PEP and went from prison release to paycheck in 21 days last year, says Smith.

Since the program's founding in 2004, it has graduated more than 30 classes and 1,450 students.

Hearne says being a part of PEP has opened "all kinds of doors" by offering resources like classes, support and access to professionals in the industry.

"People incarcerated made decisions, [but it's] some product of a condition," he says. "[They] realize the mistake they made but need a push in the right direction."

[Former prisoners] realize the mistake they made but need a push in the right direction.
Charles Hearne
executive relations manager for PEP

The recidivism rate for program graduates, or their tendency to be incarcerated again within three years of release, is only seven percent. That's a lot lower than the state's three-year rate, which is closer to 25 percent, says Smith. The national recidivism rate is 50 percent, according to the Brennan Center for Justice.

Nationally, these numbers haven't changed much, senior counsel at the Brennan Center Lauren-Brooke Eisen says. More than 2.2 million people are incarcerated in America, which means 25 percent of all of the world's prisoners are behind bars in this country. Improving the U.S.' recidivism rate and rehabilitation are crucial goals.

With its success rate, the PEP has considered helping others who want to launch similar programs elsewhere. For now, though, since there are 150,000 men imprisoned in Texas alone, the non-profit is focusing its energies within the state.

The next class will graduate in early June.

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