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TICKER - Steady as she goes Wellesley’s Jane Mendillo jumps ship for harvard
How does a university endowment survive a brutal credit crunch?
How does a university endowment survive a brutal credit crunch? Jane Mendillo thinks its by maintaining a well-diversified portfolio thats rich in alternative assets. Thats why the soft-spoken chief investment officer of Wellesley Colleges $1.67 billion endowment doesnt plan any big changes when she starts her new job on July 1 as CEO of Harvard Management Co., which runs the biggest university endowment in the U.S.
Like the Wellesley fund she has managed since February 2002, the Harvard portfolio holds a diverse mix of U.S. and international equities and bonds and has a large allocation of alternative assets, including private equity. Its well positioned to weather the current market turmoil, Mendillo believes. I dont think there are any specific major things I am going to need to do right away in terms of a reallocation of assets, says the mother of two teenage children.
Harvards $34.9 billion in assets dwarfs any fund Mendillo has ever managed, but she is intimately familiar with the endowment. The 49-year-old Yale School of Management graduate held several different positions while working at HMC from 1987 to early 2002; the last five of those years she was vice president in charge of external managers, who then ran one third of the endowments assets. Since then, that portion has risen to 70 percent, a level she says she wont change.
At deep-pocketed Harvard, Mendillo could become a magnet for cash-starved companies in search of private equity investors especially in todays tight market. Harvard has lots of dollars to invest, so a lot people are looking at it as an opportunity to provide liquidity in ways that might not otherwise exist, says Collette Chilton, CIO of Williams Colleges $1.89 billion endowment. Mendillo declines to comment except to say that shes looking forward to having the wider array of options that comes with Harvards sheer size. Its a great platform from which to look for significant investment opportunities, she notes. The kind of turbulent markets we are having now can lead to significant moneymaking opportunities.
Mendillo was named last month to the post vacated by Mohamed El-Erian last fall. She will be the first woman to run Harvards endowment and will serve under the universitys first female president, Drew Gilpin Faust. But Mendillo doesnt consider herself an affirmative-action case. Gender has not been a major issue for me in my career, she says. Superior returns are really the thing that people are looking for.