In 2003, when I retired from UVA, I started thinking about outsourced investment offices. It was a new concept – most institutions were either large enough to have their own investment office, like UVA, or were much too small and using an investment consultant to aid their governing board in making investment decisions. A friend of mine, who is a venture capitalist, encouraged me to put together a business plan and the backbone of what would ultimately become Investure began to emerge. We would bring together a consortium of mid-sized colleges and foundations and pool their investment capital in order to provide the many benefits of scale that come from having a larger investment office, including having exposure to a larger deep team of investment professionals and greater access to top-tier investment managers. In short, the hope is that these smaller institutions would be able to compete against much larger institutions in terms of investment sophistication and, ultimately, returns. When my venture capitalist friend read the business plan and said he wished he could invest it in, I started to set the wheels into motion. At that point in my career, I wasn’t afraid of failure.
The “Seven Sisters,” a group of historically women’s colleges in the northeast, was discussing the possibility of consolidating their investments. I met with them to compare their ideas with my own and, at the conclusion of the meeting, one of the members – Smith College – was eager to move forward. Joined by two partners from UVA, we launched Investure at the beginning of 2004 with $1 billion from Smith College.