Straws in the Wind - Part 14

From the NY Times: Yale University’s famed endowment has been trying to offload one of the largest portfolios of private equity investments ever in a single sale, a move that reflects the pressures on both Wall Street and higher education under the Trump administration. The Ivy League school has sought buyers for up to $6 billion in stakes in private equity and venture funds, according to three people briefed on the sales process, amid uncertainty about its federal funding and the reality that many of these investments have not delivered the outsize returns that Yale expected.

Yale is now close to completing a sale of roughly $3 billion of the portfolio and is selling the assets at a slight discount, one of the people said. “This is a big deal,” said Sandeep Dahiya, a professor of finance at Georgetown University who has conducted research on the performance of endowments. “The investor that was the lead architect of investing in the private equity markets is pulling in its horns.” ...

The sale comes at a critical juncture for universities. While President Trump has spared Yale the kind of punitive funding cuts he has leveled against other Ivy League schools such as Harvard, Yale is grappling with decreases in federal research funding that have hit higher education broadly. Republicans in Congress have also proposed steep tax increases on endowments...

Yale is on track to spend roughly $2.1 billion from its endowment in 2025, which accounts for just over one-third of its annual budget...

At least two other large universities are preparing to sell some private equity assets, and dozens of U.S. and Asian pension funds are also looking at exits. Lawrence Siegel, a former director of research at the Ford Foundation, called Yale’s move “a wake-up call” for investors. “It’s also Yale trying to get out before everyone else,” Mr. Siegel said.

Full story at https://www.nytimes.com/2025/06/10/business/yale-endowment-private-equity-trump.html.

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Note: Yale's endowment stood at $41.4 billion at the end of June 2024. Source:

https://news.yale.edu/2024/10/25/yale-reports-investment-return-fiscal-2024.