Swensen Symposium Celebrates Yale CIO’s Lasting Legacy

The Swensen Asset Management Institute, founded at Yale SOM to build on the legacy of the late university endowment manager David Swensen, recently hosted a symposium honoring the 25th anniversary of the investing titan’s classic book Pioneering Portfolio Management: An Unconventional Approach to Institutional Investment.

Swensen, who earned his PhD from Yale University in 1980, stewarded Yale’s endowment from 1985 to 2021. As the university’s chief investment officer, he developed a diversified approach to endowment management now known as the Yale Model, which institutions across the country have since adopted. His approach, codified in Pioneering Portfolio Management (PPM), transformed the institutional investing field.

“It’s hard to recall today how conventional investment management was before David launched his effort at Yale and created his wonderful book,” said investment consultant Charley Ellis YC ’59, who wrote the foreword to PPM. “But it is an extraordinary change that’s taken place right in front of all of us, much to the benefit of institutions in the United States and in other countries as well.”

Established in 2023, the Swensen Asset Management Institute named veteran investment executive Erin Bellissimo as its executive director in September. The Swensen Symposium was the institute’s first major event. In a series of panel discussions, leading practitioners discussed PPM’s enduring impact, the evolving investment landscape, and the role of schools like SOM in preparing the future investment management workforce.

In the opening panel, Robert Wallace YC ’02, CEO of the Stanford Management Company, moderated a conversation on the core principles of PPM. Speakers included Ellis; Lauren Meserve YC ’93, CIO of the Metropolitan Museum of Art; and Andrew Golden SOM ’89, former president of the Princeton University Investment Company.

Together, they reflected on the enduring relevance of Swensen’s approach. Analytically rigorous decision-making frameworks, keen assessment of principal-agent dynamics, and selective active management are as important today as they were 25 years ago, the panelists agreed. “PPM is still the world’s best and most forward-looking text on institutional investing,” said Ellis, who served on Swensen’s investment committee for 17 years.

Another panel featured three university endowment CIOs who began their careers at the Yale Investments Office: Lisa Howie SOM ’08 of Smith College; Matt Mendelsohn YC ’07, who now leads Yale’s endowment; and Robert Wallace of Stanford University. In a conversation moderated by former Yale president Richard Levin, the group examined emerging challenges and opportunities including liquidity management after the 2008 financial crisis, the excise tax on endowments, staffing models, and AI.

Asked how AI will impact the nature of investment work, Mendelsohn emphasized that the technology’s core function is to generate predictions based on trends. “How you create differential investment success is sort of the opposite of that,” he said. “I think it’s a really interesting challenge in that context, and it’s something we spend a lot of time thinking about.”

Two panels considered the role of educational institutions in preparing students for careers in investment management. Moderated by Bracebridge Capital co-founder and managing partner Nancy Zimmerman, “Preparing the Next Generation of Investment Managers” featured Alex Hetherington YC ’06, managing director of the Yale Investments Office; Ben Inker YC ’92, portfolio manager and the co-head of asset allocation at the investment firm GMO; and Andrew Spokes, partner and executive chair at Farallon. Panelists argued that despite a growing disconnect between research and practice, a theoretical understanding of finance remains crucial for career advancement.

The group also discussed qualities of successful investors, like curiosity, perseverance, and a genuine passion for the work. “Something we find ourselves teaching a lot at the Investments Office is writing skills and how to communicate investment ideas clearly,” Hetherington said. Inker and Spokes pointed to writing as an important process that ensures thorough research and rigorous thinking.

Dean Takahashi SOM ’83, who worked with Swensen at the Yale Investments Office to develop the Yale Model, moderated the final panel. He was joined by Len Baker YC ’64, partner at Sutter Hill Ventures; Kim Sargent YC ’00, CIO at the David & Lucile Packard Foundation; and Peter Ammon SOM ’05, CIO at the University of Pennsylvania.

Takahashi noted the non-traditional backgrounds represented among the event’s speakers—from physics to classical ballet—and asked the panelists how they evaluate future employees. Panelists agreed that while quantitative skills are core to the work, promising candidates must also demonstrate intellectual curiosity and critical thinking skills.

“Investing involves math, but investing is not math,” Sargent explained. To best prepare future institutional asset managers, programs should use case-based approaches that simulate real-world ambiguity, she said.

In the event’s closing remarks, Hillhouse Capital founder and CEO Lei Zhang SOM ’02, a former intern of Swensen’s who translated PPM for a Chinese audience and later launched his firm with an investment from the Yale endowment, reflected on his mentor’s legacy at Yale and beyond. PPM was published at the start of the internet revolution, he noted; now, the launch of the Swensen Institute coincides with a new technological era defined by the rise of AI.

“As investors in rapidly changing markets, it’s more important than ever to have David’s guiding principles,” he said.