Odd Lots - The Harvard Endowment Is on the Verge of Losing Its Crown

Episode Date: November 22, 2024

For years, the Harvard Endowment has easily been the largest endowment of any university. But as of right now, it's at risk of losing its crown to the University of Texas. So what happened? It's a combination of things including organizational tumult, external controversies over the university, controversy about the endowment's model itself, and other factors. And of course, Texas has unique tailwinds -- including a huge energy windfall -- that aren't easily replicated elsewhere. On this episode we speak with Bloomberg's higher education reporter Janet Lorin about what's changed at this huge source of capital.Become a Bloomberg.com subscriber using our special intro offer at bloomberg.com/podcastoffer. You’ll get episodes of this podcast ad-free and exclusive access to our daily Odd Lots newsletter. Already a subscriber? Connect your account on the Bloomberg channel page in Apple Podcasts to listen ad-free.See omnystudio.com/listener for privacy information.

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That's vanguard.com slash audio. All investing is subject to risk vanguard marketing corporation distributor. Podcasts Radio News. Hello and welcome to another episode of the Odd Lots podcast. I'm Joe Wisenthal. And I'm Tracy Allaway. Tracy, we talk about investing all the time on the show. We talk about private credit.

We talk about hedge funds. We talk about the market itself. But, you know, there are like a few of these gigantic institutional players out there. One of them is insurance that, like, just don't get a lot of attention. These huge pools of capital. Yeah. Yeah. You're right.

So, you know, we've talked about, we want to talk about insurance more. We should probably talk about family offices more, too. Like, that's this whole world that I don't think we've ever really explored, but just this massive and booming source of capital, like what the deal is with those. Yeah, I remember right around the time that I left Hong Kong, that was such a big story, especially in Singapore, everyone opening family offices. But there's another category of massive pools of capital that we need to talk about. Absolutely. And that one, of course, is endowments. They're huge and they have, you know, they're distinct. They're distinct from banks. They're distinct from insurance companies. They have their own funding needs and their own funding profiles and the schedules with which they need to withdraw and disperse their money. And if you're a hedge fund or if you're anyone else looking for money for your investment, at the end of the end of the endowment, at the end up the endowment.

Yeah, so I'm really interested in kind of how that became a thing because, of course, university endowments nowadays are known for making investments in things like private equity and hedge funds and stuff like that. And I'm curious how all of that began and then obviously how it's been working out. So you know what another cool thing, Tracy is? At least when it comes to university endowments, I believe the endowment of my alma mater, University of Texas, is on the first. I knew that was coming. Yeah, yeah, is on the verge of becoming the biggest university endowment in the country. Right. So for years, Harvard was the biggest, right? But it looks like it might be superseded by Joe's college. Congratulations, Joe. Thank you. Have you been donating? Is this all you? Can I just say, I don't, I've never donated. They have so much money already. They don't need my donation. I probably should. I don't want to talk about how I avoid the calls from my university. And I don't know. I feel. a little bad about it. I think in this case, well, we'll get into why, but maybe it's okay not to donate.

We'll talk about it. I don't really want to talk about it. You know, and even talking about how big UT is versus, I think there's actually like 22 universities or something served by the Texas Endowment and other things. So I don't even know if it's a true apples to apples comparison because, you know, the student body of Texas is so gigantic. Nonetheless, if we're just looking at, okay, which university the endowment is the biggest. At least current, there's a very good chance it looks like the Texas could eclipse Harvard on that front. So we got to understand what's going on more in endowment world. And then the other thing is not just that Texas has grown and that's great and I love to see it, but that Harvard's performance has been a little bit mediocre in recent years, even compared to

just other ivies, the rest of which sort of smaller. The Yale Endowment is sort of famous, actually not necessarily due to its size, but because of its longtime manager's approach to endowment. investing. So we've got to learn more about what's going on with Harvard and what's how these big institutional pools of capital, how they're performing and what they're doing. Yeah, it is kind of funny that the Harvard endowment, which presumably employs a lot of highly paid smart people. I think it was up about 9.6% in 2024. That's the preliminary fiscal year. But of course, the S&P 500 is up like 22% so far. So, yeah, what's going on? Just buy SPY.

No, like people will say, oh, you can't really compare. People love to say you can't compare things. Oh, you can't compare hedge funds return to the S&P. You can't compare an endowment funds return to S&P. Maybe that's true. I don't totally get why. Anyway, should we learn more? Let's do it.

Well, I'm really excited to say we do have the perfect guest, someone here at Bloomberg, who I've wanted to speak to on the podcast for a long time. We're going to be speaking with Janet Lauren, higher education finance reporter for Bloomberg. Janet, thank you so much for coming on Odd Lots. Thanks for having me. How do you get to be the higher ed finance reporter of Bloomberg? And also it's like we just have one, like, what's the deal? These institutions are so important. We probably have, you know, 20 people covering hedge funds. We just have a higher education finance reporter. Well, I've been writing about university finances for almost 17 years here at Bloomberg. And it's not just endowments, but I used to write a lot about student loans back when they were only about a trillion dollars in outstanding debt and college admissions and endowments. And And it's just a fun job.

And there's a lot of money involved. And there's a lot of nuance that most people have no idea about. And it's, I'm thrilled to talk about Harvard as well as the University of Texas. It has an amazing story. Great. Okay. So talk to us a little bit more about how significant the spaces. Like how much money are we actually talking about?

Off the top of my head, I mean, we're talking about several hundred billion dollars. The universe is, you know, there aren't too many college endowments that have over a billion. Maybe it's around 50. I can get you the exact number. But there certainly aren't that many the size of Harvard and Yale and the University of Texas. In Harvard, I include in many stories, is the oldest and richest university. You know, it goes back to the 1600s and Harvard was actually founded, you know, through a donation. And as, you know, donors, alumni, rich people in Boston gave them money over hundreds of years. You know about that thing called compounding interest. Yeah, imagine if you just bought Spy on 1600. Sorry, keep going. So that has certainly helped them. But in the 1960s, college endowment started doing something different. Instead of having a traditional 60-40 split, you know, with a lot of plain vanilla-type U.S. equities, bonds, they pursued a different model.

And the Ford Foundation actually presented this strategy in schools like Harvard and Yale started using it because they're, time horizon is literally in the hundreds of years. So they, liquidity for them is okay because, you know, they have a very long-term horizon. So they started moving things into illiquid assets over time, private equity, hedge funds, you know, eventually venture capital, real estate, you know, now private credit. But at the time, that was a pretty new strategy. Harvard and Yale did things a little bit differently. So Harvard management company, which runs the endowment is 50 years old this year. They actually operate not in Cambridge, but in downtown Boston in the Federal Reserve Building. It's actually very close to our Bloomberg office in Boston.

And they employed traders. And it was over 200 people working there. They were extremely good at their job. Their strategy was literally the envy of the world. They made a ton of money. A guy by the name of Jack Meyer, ran the fund, and there was some outcry by a group of alumni and people who thought their managers were being paid too much because they just consistently exceeded the market. And one year, there was a manager who tried to remember paid $35 million, and people were just aghast at that because they made too much money. So after a lot of criticism, long story short, that model was disbanded. Jack left in 2005. They went through a succession of managers. Seven CEOs of the Harvard Management Company. Some only stayed a short term. There were two,

less than two years. Several interims. Changing strategies, selling off assets. For a while, they were big into agriculture and real assets. Those perform well, but then they didn't perform well. and the current CEO has been there since December 2016. He eventually sold a lot of those natural resources, you know, I think writing off like a billion dollars in, you know, change of strategy, not at the greatest time. They didn't have a lot of private equity, and they've ramped that up now. That was a great potted history of Harvard's endowment.

I ought to say, Joe, I started rewatching, did you ever watch the Gilmore Girls? Probably not. No, I never did. I started rewatching Gilmore Girls. How are you going to tie this in? Well, so it's all about rich people in Boston, basically, and one of the main characters has to decide between Harvard and Yale. She eventually goes to Yale. I guess she was lured by the performance of the endowment.

So, Janet, you gave us the broad history of Harvard's endowment. And I want to talk about actually, like, what happened in those years from, like, how you have one stable management company that goes all the way to two. 2005, more or less, and then you run through, I think, what did you say, like seven CEOs since then or something? And then Tracy mentioned the Yale Endowment with their famous endowment manager for several years, David Swenson. Can you talk about like the sort of compare and contrast between the strategic volatility, and I'm not even talking about price volatility, but the strategic management volatility of Harvard versus the Yale model that I think David wrote a whole book about? So Harvard management company files a tax return. And because of their nonprofit status, they have

to disclose how much they pay their top people. And Yale, the investment office is part of Yale University. They employ outside managers and they have a much smaller number of employees and only a handful of listed in the tax return. And because they're using outside managers, you know, you think of the two and 20 model, that's not showing up in the tax return. Whereas Harvard, you know, you could see how much they were getting paid and people read that and it was a big deal how much they were getting paid. And, you know, that's really a simple explanation of why Harvard's managers got so much more scrutiny. So you talked about the criticism of, you know, how much they're getting paid. What's the benchmark for Harvard's performance? Like, what are they actually comparing themselves to?

Well, many endowments create their own benchmark. Surprise. So I don't know. You know, they come up with it. And one of the big criticisms of Harvard's pay was the managers who did extremely. well in their own asset class would get paid based on their own performance, not the overall performance of the endowment. So if they had a middling return, which they have, some of these managers still got paid quite a lot of money. Well, then let me ask you another question. Let's say, okay, we don't really know what the benchmark is. So you wrote this piece for Bloomberg a few weeks ago talking about like issues and the performance. What has it been? Why now are people saying, look, Harvard's performance is not that great. There's some reason to be concerned.

There's some falling off in what they're able to generate for the university. Well, I think some insiders, especially, you know, some of their really famous economists, they know what's going on. But in the last year, the performance was overshadowed by some other issues, especially, you know, their president being thrown before Congress. You know, the president resigned. There was a plagiarism scandal. People have been very upset about how Harvard has handled anti-Semitism. The story I had last week said their fundraising was down. You know, their cash gifts was the lowest in fell 15%.

It was the lowest since 2015. You know, they famously raise a huge amount of money. You know, they're known for the endowment, but they're also known for being prolific fundraisers. And, you know, they did get to a billion dollars last year, but I'm sure it wasn't easy considering people are upset. Len Blavatnik, Ken Griffin, both alum said they're not giving money. They've paused their gifts to Harvard because of the way.

things are going there. Today's show is brought to you by Vanguard. To all the financial advisors listening, let's talk bonds for a minute. Capturing value and fixed income is not easy. Bond markets are massive, murky, and let's be real. Lots of firms throw a couple flashy funds your way and call it a day. But not Vanguard. At Vanguard, institutional quality isn't a tagline.

It's a commitment to your clients. We're talking top-grade products across the board of over 80 bond funds, actively managed by a 200-person global squad of sector specialists, analysts, and traders. These folks live and breathe fixed income. So if you're looking to give your clients consistent results year in and year out, go see the record for yourself at vanguard.com slash audio. That's vanguard.com slash audio.

All investing in subject to risk vanguard marketing corporation distributor. On April 4, 2023, around 2 in the morning, a man was found stabbed multiple times on a sidewalk in downtown San Francisco. Hey, we did this to you. What happened next turned the story into a political firestorm. Reports have identified the victim as Bob Lee, the founder of Cash App. From Bloomberg Podcasts, this is Foundering, the Killing of Bob Lee, beginning April 16. So one thing I'm trying to wrap my head around is, as we've mentioned, a number of times, Harvard is a huge pot of money.

And I've heard people say stuff like, because of it's. size, it makes it harder to move positions around. It can't be as nimble. But then I think, well, it's huge. So it should be getting like the best deals. It should have some sort of edge. So is size here a net pro or con? I think that's a very fair question. And, you know, Harvard will say it's so big. It's hard to manage $53 billion. Now keep in mind, the size hasn't been that big ever. They had a huge $11 billion gain in fiscal 21, you know, when everybody had a crazy year. You know, some endowments had gains at 50 percent. Harvard was on the low end at 34 percent. And of course, they had a huge decrease during the financial crisis, so they've been

building back up. Now, the school with the best 10-year performance is Brown, and that has the smallest endowment size. And they're definitely more nimble, but they seem to take more risk. You know, they're into, you know, you've heard maybe there's some cryptocurrency or there's some other risk there. And if you go back and read all the Harvard alumni, I'm sorry, the Harvard financial reports as I did, the current CEO talks a lot about risk. He mentions more than once that Harvard takes less risk than its large peers. And, you know, it still could be a vestige from 2008 when they had a huge liquidity problem. Let me ask another way of thinking about the benchmark sitting aside what is a good return in a given year or a good return over five years.

What is the importance of the Harvard endowment to the Harvard University budget? And because there's multiple ways of financing the university, there's tuition, there's alumni giving, there's probably other grants and stuff like that. And then there's the money that the endowment throws off. What does Harvard University need from the Harvard Endowment? Well, the Harvard Endowment is the largest provider of money to the university, 37%. Okay. And that's grown over time. Ten years ago, it was 31%.

And 20 years ago, it was 21%. So, in other words, Harvard University is becoming a lot more reliant on the Harvard Endowment. So you mentioned this idea of investing in Alts. And I think Harvard was like a backer of D.1. in particular, a hedge fund. And I'm curious, the sales pitch from hedge funds is always uncorrelated returns. So what happened in down years for Harvard? Like in 2022, 2023, when markets were like, or sorry, in 2023 when markets were falling, did they manage to post above average returns? So over time, in in 2023, I think they had a 2.9% gain, which was not bad, you know, among the Ivy League schools.

A couple of big endowments had losses. I think it was Duke and MIT. And MIT is really strong in their returns to that we don't sort of use them in their eight schools because, you know, the Ivy League is a sports conference, but it's also a nice group of eight schools that you can easily compare. and Harvard, you know, in the big year where the, in 21, they were below average in the Ivy League. Now, they didn't traditionally have the allocation to private equity in VCs that say Yale did. And Harvard is now at 39% in private equity, but they've ramped up really since 2016. I'm sorry, it was 16% maybe five years ago, six years ago, and now they're at 39%. So they've been ramping up sort of not at the best time. And keep in mind that Yale has been investing in some of these private equity firms and VC for years and years and years. And people really want to be Yale's partner.

And Harvard sort of has a reputation of not being the greatest partner because, as you saw in the D1 example, you know, they sell. And, you know, they had to unload, you know, a billion dollars worth of natural resources assets. So people clamor to be, you know, in the Yale and the Princeton Endowment because they're seen as just amazing partners. and Harvard doesn't seem to have that same reputation lately. Yeah, I mean, I don't know that much about the Yale Endowment Model, and I probably should read David Swinson's book at some point and all that and really learn about it. But I do get the impression that it's designed to just be, not set it and forget it, but like truly it's all about that sort of all cycle portfolio, right?

That really can just, is designed to ultimately work across a long cycle of whatever's in and out. Well, they will look at firms for years before they may make an investment. So they tend to do their homework for a long time. And I think I remember in one report, they said the average tenure of their outside managers is something like 13 years. So it's, you know, if you think getting into a school like Yale or Princeton is hard, try getting to be one of their managers. Well, just actually, and I want to get into this more, but just a very quick question. Does Harvard have hedge fund allocation? Of course.

Oh, yeah, you're already talking about. Yeah. Okay, got it. They do. Okay. And it's the second largest allocation. Now it's at 32%. The largest allocation is private equity at 39%.

And just a very, very short question, if Tracy and I are starting a hedge fund, and it's like a multi-strategy hedge fund and all that stuff, would Harvard definitely be one of our stops when we're trying to look at raising money? Did you go to Harvard? I'm just kidding. I don't know. It just depends. They like nichey, really nichey stuff. Got it. So if you're peddling something like a Japanese something fun that is really nichey that nobody else is doing, maybe.

So you mentioned the sort of turmoil at the upper levels of the Harvard Endowment. And I think we're on the fifth CEO in like 11 years, something like that. Can you describe the new CEO? Like where does he come from? And is his style different to predecessors? I think he's done some restructuring of the company and things like that. Yes. So he came in December 2016 from Columbia where he had excellent performance.

And that was one of the reasons why he was hired because, you know, the performance at Columbia used to be pretty good. But he came in and had to steer a very large ship and a ship that's very scrutinized. Everybody wants to know how Harvard is doing. And as I mentioned before, they used to employ more than 200 people traders. And they had a different model than Yale because they had a huge internal, you know, presence. And they slashed that. He also reversed course on natural resources where that had been a huge interest of Jane Mandillo, the previous longer-term CEO of Harvard Management, but they didn't do as well.

So he sold a lot of those off. they restructured pay. Again, we talked about, you know, if you're a manager and you did great in your own asset class, you would get handsomely rewarded. But if the endowment as a whole was not performing well, that didn't really matter. So he made a lot of changes. Let's talk about actually, you mentioned natural resources, which could be code for a few things. So I seem to recall, I just remembered another thing that I remembered about David Swenson, which is I think he was like really into timber for a while. And it was like sort of like famous. into timber. But then there's another natural resource issue, and this will eventually allow us to

talk about what I really want to talk about, which is the University of Texas. But of course, resource politics and resource investing is always controversial when it comes to, you know, carbon fuels like oil and stuff like that. So before we get into Texas and all their oil money, what is the status of Harvard's own investments in things like oil and et cetera? And how does like the sort of unique politics of Harvard effect? those choices. So for a long time, most schools, you know, were asked by their students to divest from anything related to fossil fuels. Harvard did not divest from anything. I think sometimes that's not understood well. Divest means selling things. And Harvard said we're not going to make new

investments. So you know what it means to allow things to roll off. You're not going to make, you know, when this next private equity fund is raising money, that means they may not go into it. They're not selling on the secondary market. You know, typically endowments don't have direct holdings, or, you know, maybe they have a tiny amount. Maybe it was a gift and they still have held on to it. But typically endowments today do not have direct holdings and companies. That's how they used to in, you know, in the 70s and 80s. And in the 80s, when you heard about schools divesting from, you know, investments related to apartheid. They were literally selling U.S. companies that operated in South Africa. So that's it. that's a huge change. So they stopped making new fossil fuel investments, and Narve wrote in one of the

reports in 22 when they had a loss. The CEO said Harvard had missed out on strong returns in the energy sector, and that decision contributed, you know, marginally to the loss that year. But at the same time, you look at a place like Texas, which has huge amounts of cash coming in because of oil. And is this a good time to bring up their history? Yeah, yeah. Yeah, there's a good point. Yeah. Where does the, how did the oil money kind of start?

So it was kind of a fluke in a lucky stroke of history. In the late 1870s, the state of Texas set aside land for higher education. And it was supposed to be near the railroad, but it was too valuable. And it got moved to West Texas. And eventually higher education in Texas was allotted something like two. 1 million acres in West Texas, and they were supposed to generate money by agriculture or grazing rights. And the plan was eventually to sell it.

But then in 1923, something happened. Joe, do you know what happened? Well, black gold. Yes. No, there's a, they're at the University of Texas campus. There's this little, I don't know if it's still there. It is still there. Yeah, 20 years ago, there's this little like sort of, I don't know, exhibit.

And they play this audio. I was like spindle top black gold. And it has like with this like really like exaggerated Texas accent. And there's like a fake oil derrick or oil well or something like that. It sort of shows like where it all came from. So in 1923, they literally started getting all this revenue from oil. And I did a story a couple of years ago. I went down to Midland and I went on on the land.

And that year they got something like $2 billion in cash. And it's a it's completely separate from. their endowment. It's not generated from investments. It's just cash that comes in. And the crazy thing about it is, you know, you hear, oh, well, at some point energy is not going to be, you know, is not going to be as valuable, which, you know, it's still going to be around for 20, 30 years, generating a lot of money for Texas. But they're in the best position for wind and solar also, which is a really, you know, nascent industry there. But, you know, when you're ready for that, they're going to make a lot of money too.

It is kind of crazy to think that that decision to set aside land in like the 1800s is really paying off now. So every once in a while, Joe will tweet something about the Texas Longhorns, the football team. And so one thing I'm curious about is we're talking about all this money that's flowing into universities. What's the breakdown of like where colleges get their money? So I imagine it's a mix of donations, returns from endowments. Are sports like part of that too?

I don't think it's a huge amount. I mean, unless you're, you know, one of the schools like Texas, it actually makes money on sports. But it's a very small number of schools actually collect, you know, somewhat of a, I don't want to say a profit, but generate revenue. But, you know, many schools have weird histories of how they made their money. Like Emory, for example, in Atlanta, they're one of the. richest schools. And part of the reason is because of the Coke stock that was given to them.

And they eventually sold. Northwestern is one of the richest schools because a drug called Lyrica was developed in the chemistry department. One of their presidents, a few years, a few presidents back, decided to sell half of the royalties. And that's, you know, why they became one of the richest schools. Sorry, I'm just thinking more about that little exhibit on the Texas campus campus. But there's the other thing. They're like, black gold, Texas T, which they also said, I love that Texas T. Why didn't we go see that exhibit when you were there? Yeah, I don't know.

But it's like one of those things where it's like if you're a college student, you're like walking around and you may be like drunk at 11 p.m. at night and you're like walking through campus. Like you stopped there. And the audio is playing, if I recall like 24-7 next to this pump. I'm sure you're not speaking from personal experience here. Not really. But that's like a thing that you do. Okay. I get like Texas has this big advantage because of this flu.

gift from over 100 years ago and they discovered all the oil and, you know, and the wind and solar coming up. But like, it's not just that. They've done a good job too, right? Well, they're huge. I mean, it's a huge campus. And initially, that money only funded two campuses, U.T. Austin, and we can't forget about Texas A&M in College Station. They share that land. Two-thirds goes to University of Texas at Austin. One-third goes to Texas A&M. And they pool that money together and it's invested in a company called UTIMCO. Yeah. They followed the Harvard management company model and they created a separate company.

And UTIMCO is based in Austin. And, you know, if you're a hedge fund and you're visiting, you know, the big Texas pension funds, UTIMCO is there in Austin. So it would just be another place. So, Tracy, because of my Texas roots and we're starting our odd lots, multi-strategy hedge fund, we would stop at U-TIMCO rather than Harvard. That would be our first stop rather than Harvard, it sounds like. You just want to go to Texas.

Yeah, but I also want the money. Yeah, okay. One thing I'm wondering is, so endowments are invested heavily in private equity, which we talked about. And it feels to me like there's a little bit more criticism of private equity right now than there used to be. There was a big piece in The Guardian about how private equity is like ruining the economy and things like that. Do you think there's going to be any pressure to divest for? from P. Well, I don't know that they would want to sell anything on a secondary market, but they,

you know, perhaps, you know, they may not want to re-up and increase their allocation because at this point they're quite large. You know, Harvard and Yale and Princeton, they're all around the 39%ish percentage. And part of the reason is, again, I keep going back to 2021 when they had these crazy returns, but, you know, the value of their private equity books just really increased with those returns. So, you know, it's just a, it's a bigger share of their endowment. And plus, you know, they've had great returns up until recently. And, you know, when you think of when David Swenson started investing in private equity decades ago, there wasn't that much money. So it was

easier to get crazy returns as they did. A lot of short daily news podcasts focus on just one story. But right now, you probably need more. On Up First from NPR, we bring you three of the world's top headlines every day in under 15 minutes because no one's story can capture all that's happening in this big, crazy world of ours on any given morning. Listen now to the Up First podcast from NPR. What separates good leaders from transformational ones? I'm Jessica Chen, and in season two of Leading By Example, we'll sit down with executives like Grace Chen of Bertie Gray to find out. It's important to understand. It's important to understand. where you spike, but also really acknowledge where you don't and find people who can fill those gaps.

Listen to leading by example, executives making an impact on the IHeart radio app, Apple Podcast, or wherever you get your podcasts. So where are we in terms of the biggest? How close are we towards my Eutimco eclipsing Harvard management company? What do we talk about here? Well, it's hard to tell. I mean, if you look at how Harvard did in the last 10 years in their annualized returns in the year that ended 20, 23, they were in the bottom 20%.

So it's hard to tell. I mean, if you get another banner year with energy and they keep getting, you know, a couple billion dollars in cash. But like, how much literally is the gap? Like, what do we know in terms of their size? I don't know if I've seen what UTIMCO's size is right now. But, you know, a couple billion here and there. So we're close.

Okay. So the other thing that's going on, speaking of public criticism, is some of the Israel Palestine controversy that's happened at Harvard over the past year. Talk to us about that and what impact that's been having on donations. So Harvard has been at the forefront of protests on campus. Like many schools, they had encampments. Theirs ended in the spring without police arrests. I think everybody was very happy about that. But there was a tremendous amount of criticism over the last year about how they've handled anti-Semitism on campus, protests, encampments, and alumni really mobilized and said, we're not donating and, you know, in alumni, very wealthy ones like Len Blavatnik, and just sort of

your average Harvard alum, you know, said, we're not going to do this. And they're known for being amazing fundraisers. They've raised over a billion dollars every year since 2014. They usually raised the most, although Stanford has raised more in some years. And donations were down 15% in the year ended in June. And when you think about when they were in the news so much at the end of December, remember there was that congressional hearing in December 5th with the presidents of Penn, MIT, and Harvard, they were, you know, in the news nonstop until the end of December. She ultimately stepped down Claudine Gay, the president, on January 2nd. But when do most people make their gifts to colleges?

They make their gifts at the end of the calendar year. And that was not a great time for Harvard. I just have one last question, and it's a little bit philosophical. Am I bad for not donating to my college? I had an amazing time at Texas. I mean, seriously, I had an amazing time at Texas. Nothing I actually learned led directly to a job, but it was a formative experience. I look back on it fondly.

I've been very fortunate in my career since then. Many good things that have happened in my life or roughly from that time that I spent there. Like, should I like think about this differently? Because when I look at it, like, they have tons of money. They don't really need any more. Like, pitch me that it's like a good idea. Well, do you want to help students have a similar experience that you do?

Yeah, but they have tons of money. I don't know. Maybe there's something in particular. You can tailor your donation to something specifically. I mean, and that's one of the things. The podcast course. Yeah. Well, that's one of the things that Harvard, you know, complains about is a lot of their money is, they say it's restricted.

Oh, yeah, right. So if you give money to the crew team, they can't spend it in theory on the tennis team. Right. So you could say, I want to, you know, I want to give it to something. And then there you go. It could be named after you if you want. Yeah. Maybe a little podcast studio at the J-School.

There you go. Joe Wisenthall podcast. Yeah, all right. There you go. Maybe that could work. And they, you know, one thing about these gifts is, you know, they're multi-year, so you could make up pledge over 10 years or whatever the case. But I'm open to changing my mind on this.

So I just, but, you know, I wrestle with it because I'm just between the three of us here in the room. Like, I think I have the number that, like, they call me on. Like, I either haven't blocked or like I have like it says, like, do not answer. I'm open to, I'm open to like. That's kind of cruel. That's kind of. I know. That's what I'm saying.

I have a little issue. I have some misgivings and I'm open to rethinking this question at this stage of my life. Janet Lauren, thank you so much for coming on. I really appreciate it. Thanks for having me. That was a lot of fun. Thank you so much. Tracy, I am going to use this podcast for the most nakedly egregious self-serving purpose ever right now.

And I just want everyone to be aware of that, okay? Wait. Is it urging listeners to continue to support the pod so that you can make donations to students? No, no, no, no. I'm like open to rethinking my philosophy on donations because I probably when I blocked the number, I was like, you know, much younger and earlier in my career. No, you know what I've thought? I can't believe I'm going to say this out loud. I've thought that a nice, I quote, retirement job for me would be being some sort of adjunct professor at the journalism school at UT and like, you know, I've done a lot in digital media. And like maybe through donations or something, find a way back into that community. Yeah, start laying the groundwork now. Basically, I start prepaying my salary. Make a bunch of donations so that, you know, 20 years from now, when we stop doing odd lots, there's like this pool of money that can fund my adjunct degree.

Yeah, absolutely. But maybe someone will hear that and like reach out. I'm just saying. Don't go to Texas, Joe. No, I'm not going to. Yeah, no, I won't. Okay. But yeah, maybe someone will listen at the University of Texas Journalism School and hear about my

In 20 years, hopefully. Yeah. You know one other thing, though, for real, though I think it's really interesting about this, and I hadn't realized, is the difference in the corporate structure between the Harvard Endowment and the Yale Endowment. And so anyone can just look at the Harvard Endowment, why are you paying all these people so much? Have you heard passive is the future, all these fees? And yet you could have another institution that's doing fantastically,

and no one sees how much they're paying managers or how much individual star traders are getting because those independent star traders are at the hedge funds that no one actually gets to see because they don't file some independent return. You know, speaking of transparency, I saw this really great chart in the Harvard Crimson, the student newspaper, and it's the word count of the annual message from the Harvard management company CEO, the endowment CEO. And I think it used to be like over 3,000 words typically, and now it's gone down to a little over 1,000. Oh, interesting.

That's where a lot of the criticism of lack of transparency at Harvard comes from. Yeah, well, you just get rid of all, you know, don't have any in-house traders talking a thing. And you just, you let the third party managers, the hedge funds be, let them write the words in the letters. That's their job is to write words in the letters. That's right. Shall we leave it there? Let's leave it there. All right.

This has been another episode of the All Thoughts podcast. I'm Tracy Alloway. You can follow me at Tracy Allaway. And I'm Jill Wisenthall. You can follow me at the stalwart. Follow our guest, Janet Lauren, at Janet Lauren. And check out her recent big take on the Harvard Endowment on Bloomberg.com. Follow our producers.

Carmen Rodriguez at Carmen Armin, Dashel Bennett at Dashbot and Kail Brooks at Kail Brooks. And thank you to our producer, Moses, Andam. For more OddLod's content, go to Bloomberg.com slash oddlots. transcripts, a blog, and a newsletter. And you can chat about all of these topics 24-7 in our Discord. Discord.g.g. slash oddlots.

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