Most money managers would leap at the chance to manage $37.6 billion. And yet no one seems particularly eager to do it for Harvard University. Ever since Jack Meyer left the world’s richest university endowment to launch a hedge fund—where he has done somewhat less well and has been reduced to running the equivalent of Cornell’s measly $6 billion endowment—it’s been hard for Harvard to attract and retain some first-class talent. After just two years, Mohammed El-Erian decided it’d be better to work for Bill Gross. The most recent Harvard Management Co. CEO, Stephen Blyth, couldn’t even make it that long before his body gave out on him. And the person bridging the gap between them, Jane Mendillo, made it through only six years, although, given that her tenure began in 2008, those were some years. By contrast, Yale’s legendary endowment chief David Swensen’s been on the job for 31 years, Princeton’s had the same money manager for 21 and Columbia for 14.
The latter is, unless Harvard has something to say about it: America’s first university has its eye on Columbia’s Narv Narvekar, as well as Rockefeller University’s Amy Falls. One thing, though: Neither is very big on Harvard’s system of running its money in house, preferring Swensen’s innovation of letting people with enough talent to get better-paying hedge and private equity fund jobs do it. And alums are getting plum sick of having to make up the difference by pulling out their checkbooks.
Both prospects have relatively small staffs and farm out their money to the best managers they can find, the approach favored by Yale endowment chief David Swensen, whose investment performance has outstripped Harvard’s….
“Yale has been the pillar of stability and Harvard has been plagued by turnover,” said Tim Keating, a Harvard alumnus and president of Keating Wealth Management near Denver. “It’s inexcusable that this debate over how to best manage the money has been going on for ten years.”