Science for the Benefit of Humanity
Reflection on Capital Allocators' Interview with Paula Volent
Many of you know John D. Rockefeller and his impeccable philanthropic endeavors which resulted in building The Rockefeller Foundation, which started with a $100 mm endowment in 1906. However, very few people know the Rockefeller University, which preceded The Rockefeller Foundation by 5 years. It was founded in 1901 as The Rockefeller Institute for Medical Research after Rockefeller founded the University of Chicago in 1889. The Rockefeller University is a preeminent scientific research institute and, as of 2020, a total of 38 Nobel laureates have been affiliated with the university, compared to 13 Nobel laureates from China. The university only offers graduate degree programs for 250 students in the biomedical sciences, chemistry, and biophysics, but the tuition is free. Yes, it’s free.
The university currently manages a $2.5 billion endowment, which has been supporting 25-27% of the university’s operations over the last 5 years. Since 1992, the endowment’s value increased from $500 mm to $2.5 bn while supporting the university’s scientific mission “for the benefit of humanity.”
Paula Volent: Unconventional Start
“There is nothing on here that is pertinent, but okay, you can file.”
David Swensen
In this show, Ted interviewed Paula Volent, who joined the small team (currently 5) of the Rockefeller University’s endowment as CIO after overseeing Bowdoin College’s endowment for twenty years. During her tenure, Bowdwin’s endowment also grew from $450 mm to $2 bn.
When Paula joined Yale, she had almost zero financial knowledge. She studied art history and chemistry and took a job as a curatorial assistant at Bowdoin College museum where her parents lived. After a few years, she decided to take an MBA course as she wanted to learn how to manage a museum in the future. She knocked on the door of Yale’s investment office while she was taking a six months maternity break. She was interviewed by the legendary David Swensen, who gave her a job as a file clerk. Paula eventually joined the investment office as an analyst and worked closely with David to publish his book, Pioneering Portfolio Management: An Unconventional Success (2000).
Yale Model is Not a Recipe That Can Be Transferred
“One of the things that I learned at Bowdoin, through David’s impact, was figure out where your competitive edges are.”
Paula Volent
Paula returned to Bowdin, where she was a curatorial assistant, this time as CIO of the university’s endowment and she revolutionized it. It took a year for her to know the risk profile of the college, which is quite different from Yale, and she recognized that Bowdin cannot manage the portfolio as Yale did. Firstly, Bowdin didn’t have existing relationship with prominent venture capital funds, which drove the performance of Yale’s past performance. Instead, Bowdin had something Yale didn’t have: Global Macro. Stan Druckenmiller, the righthand man of George Soros, was the chair of the investment committee and became an instrumental person in her life. Paula decided to construct the portfolio with significant exposure to the Global Macro hedge funds.
The World is Becoming Less Global
In 2021, Paula was invited to join Rockefeller University’s endowment as CIO, replacing Amy Falls who joined Northwestern University. While the portfolio size is similar ($2.5 bn vs. $2 bn), the market conditions are changing dynamically. Paula tries to think differently from other investors as she finds Europe interesting as it is overlooked by many other investors. She also thinks it is a good idea to bring global macro to Rockefeller’s portfolio as the world is becoming less global.
Paula is a star endowment manager who is bringing her 20+ years experiences of managing a multibillion-dollar portfolio from Bowdoin to Rockefeller. I’m thrilled to hear that she is willing to repeat her success for another 20 years or so. I truly enjoyed listening to the show and I hope you will too.
Listen to the Original Episode
https://capitalallocators.com/podcast/star-endowment-managers-next-act-at-rockefeller-university/
Paula Volent is the recently named Chief Investment Officer for Rockefeller University’s $2.5 billion endowment. Paula previously oversaw Bowdoin College’s endowment for twenty years as it grew from $450 million to $2 billion during her tenure and generated returns at the very top of the industry. Bowdoin’s Investment Committee Chair, Stan Druckenmiller, describes Paula as an innovative, outside-of-the-box thinker, an aggressive risk-taker, and a workaholic whose passion is unlike anyone he has ever seen. Paula is also one of my oldest friends in the business from our time crossing paths at Yale in the mid-‘90s. Our conversation covers Paula’s unique career path from art conservation to endowment management and the transferable lessons she learned along the way. In the process, we discuss her approach at Bowdoin and plans for Rockefeller University.