David Swensen, Yale Endowment Chief, Dies at 67

David Swensen: A Legacy of Endowment Innovation

David Swensen, a globally respected investment manager, has died at the age of 67. He significantly increased Yale University’s endowment, growing it from $1 billion to become the second-largest school endowment nationwide, surpassed only by Harvard’s.

Early Career and Yale Endowment Growth

Swensen began his tenure at Yale as a 31-year-old graduate of the institution. His leadership transformed the university’s financial standing over several decades.

Impact on Endowment Management

The news of his passing is expected to resonate deeply within endowment offices. Many institutions closely monitored Swensen’s investment strategies.

Pioneering Alternative Investments

He was renowned for steering Yale towards non-traditional asset classes. These included investments in hedge funds, private equity, venture capital, and real estate.

Mentorship and Influence

Numerous endowment leaders benefited from direct collaboration with Swensen. His approaches served as a model for their own careers.

Princeton's Endowment and Swensen's Blueprint

Andrew Golden, Princeton’s endowment chief for 26 years, previously served as a senior associate at Yale’s investment office during the 1980s. He openly acknowledged the profound influence of his time at Yale, stating that 90% of his successful ideas originated there.

A Network of Protégés

Institutions like the University of Pennsylvania, Bowdoin College, Wesleyan University, and MIT actively sought out individuals mentored by Swensen. Robert Wallace, head of the Stanford Management Company since 2015, is also a former Yale investment manager.

The "Yale Question" in Recruitment

Wealth management recruiter David Barrett noted in 2015 that universities frequently prioritized candidates with Yale experience when seeking investment chiefs, often asking if anyone from Yale was available.

Embracing Cryptocurrency

Even while facing health challenges, Swensen continued to guide Yale’s investment strategy. In 2018, he approved investments in two emerging cryptocurrency funds: Andreessen Horowitz’s inaugural crypto fund and Paradigm’s debut fund, co-founded by Fred Ehrsam and Matt Huang.

Championing Diversity and Inclusion

In a significant move last fall, Swensen informed Yale’s investment managers that continued university support was contingent upon increasing the representation of women and minorities within their firms – and ensuring their retention.

A Shift in Perspective

Swensen explained that he had previously refrained from systematic diversity initiatives due to concerns about a limited pipeline of qualified candidates. However, the Black Lives Matter movement prompted him to recognize the need for greater action and Yale’s potential role in driving change.

He believed Yale could either contribute to a solution or remain inactive.