Besides asset allocation, manager selection is a key component to managing an endowment.
Day-to-day management of the endowment falls to Martin and her staff. Evaluating and monitoring dozens of managers—whose expertise ranges from U.S. equities and fixed income to real assets, emerging markets, and private equity—is their most important task.
“The process is a bit like dating,” she says. “We prefer to get to know new managers over an extended period of time so we can observe how they operate through different market conditions. We look for a number of characteristics: high integrity, an independent mindset, and great investment judgment.”
“We’ve selected a number of new managers who we would rank among the best in the world,” Martin says, “and we’ve put in place a plan to add to and manage our illiquid asset portfolio where we think we can achieve long-term rates of return that are above those offered by public markets.”
Anne was recently interviewed on another podcast show focused on limited partners in venture capital funds called Origins by Notation Capital.
Over the course of the conversation, Beezer [Clarkson] and Anne [Martin] cover exactly what it means to run and invest a university endowment, Anne’s goals for the program, how she thinks about investing across asset classes, and particularly how she approaches venture capital and picking managers. Their discussion is a unique look into what is a typically opaque part of the Limited Partner ecosystem, and a must-listen for anyone considering raising capital from endowments.
Post by Marcelino Pantoja