Yale University

“Tufts is unfortunately quite under endowed versus its peers. So we're probably Only 10% of 10 to 13% of the university's operating budget, whereas a Harvard or Yale would be a third.”

“If you were going to diversify away from sixty-forty, by definition, everything else had to be less liquid. And that was one thing I think people misinterpreted in what he did.”

“When David first arrived, they had one billion dollars, and now they got roughly 25 times that, and they've spewed money out to the university year after year after year after year after year.”

“You know, we've been running, I try to run between eight and 12% in cash and low duration treasuries, and it's been closer to the high end of that range. It's now kind of in the middle of the range, but that's still, you know, higher than what Yale and some of…”

“It was really unusual, and in fact, was not what I originally proposed. I said to Ed, I don't want to reinvent things when there's a good model. You know, here's a kind of Yale-like model where the major decisions, manager hires, fund re-ups, would still flow …”

“But you look at, kind of, what Princeton and Yale and, you know, Northwestern's ten billion dollars, Stanford's twenty billion dollars, you know, these guys continue to put up great numbers At very large sizes, we always thought size was the enemy of performan…”

“You know, asset managers would love seed capital from Yale, and we're willing to give up a lot to get it, because of what it tells the market for the next fund.”

“In the early nineties, Yale's US equity portfolio and international equity portfolio long only were by choice biased towards small cap and value.”

“So our beloved alma mater, Yale University, has next to no money in public equities or bonds.”

“We are not price negotiators. I spent a lot of time at Yale Working on LPAs and negotiating terms, we were going to be a price taker. So it was sort of a take it or leave it decision when we found managers we liked rather than, I mean, and yes, we like to say …”

“We had about two hundred million dollars of debt outstanding at the university when I came on a five hundred million dollar endowment pool. So we knew we could not generate liquidity by going back out to the capital market. So we had to generate all our liquid…”

“Most of the people in those seats pursuing these strategies all will tell you that there are only a few dozen pools of capital that are properly structured to pursue these and succeed. It requires an army of people, a small army of people, a small army of tale…”

“So it's like a funnel, that wide angle at the beginning, thousand students a year at Yale, down to 25 students in the class, down to one or two chosen for summer interns. Down to one or two chosen for the long term. It's just, by the time you do all the sortin…”

“Where he could have added maybe 200 basis points in each of those two dimensions, then it was a 150, then a hundred. And I would guess it's down under a hundred now, maybe in around 50, and there's not going to be another source that I know of.”

“And so I would walk naively into Harvard or Stanford or Yale, these institutions that are so well-respected in the industry and doing amazing work, They were still struggling with their tool sets as well. No one had figured it out”

“The problem, from my standpoint, is we always thought at Yale, one of the reasons we hire these guys is because they know when's the right time to sell an asset. And we're sort of relying on them to do that. And then if they default that decision back to us an…”

“If things got too complicated structurally, that was often a sign of a problem.”

“In the venture world, the winners pay for a lot of losers and it's okay to have half your portfolio return nothing. In the buyout world, typically your winners are somewhere between two and a half and four and a half X, and then occasionally maybe you get an o…”

“We could have pumped the brakes in 1995, and it would have been a huge mistake.”

“Pretty much all of the venture firms we worked with, if in 1995, they were managing a two hundred million dollar fund. By 1999, they were managing a billion dollar fund. And then they were investing the billion dollar fund in nine months, which again, proved t…”

“Some of the success that our managers generated in the nineties and the first half of the 2000 was due to equity multiples going up in general. The whole 40 years until very recently was a story of declining interest rates and multiples ought to go up in a mar…”

“It is such a feedback loop business where success begets success. The best venture firms would attract the best entrepreneurs. They had the best corporate relationships. They could hire the best partners. If you were an entrepreneur needing help with your star…”

“We tended to avoid firms that did big things in the public markets.”

“I could look back at my time at Yale and say, boy, investing in hedge funds was so easy. You could invest in a diversified group of mergers, doing merger arbitrage, and make 14% net with very little risk.”

“Almost all the senior leadership was hired by David and mentored by David.”