Call Our Team: (212) 729-5067 - Mail Team@Endowments.com

The Inefficiency of High Finance

LectureThe area of high-finance is horribly inefficient, but that is good news for those who can correct that inefficiency because there is value in doing so.  We got our start by providing 1,000+ articles and videos on the family office industry, speaking at 100+ events in 23 countries and building a large family office community in the process.

Our mission at the Wilson Holding Company is to correct the inefficiency which is rampant across high-finance, the areas of investment banking, mergers & acquisitions, private equity, family offices, and hedge funds operate and sometimes feed upon the lack of transparency, consistency, and ease of communication which is a global challenge.  While some crowd funding and accredited investor aggregation platforms are helping cure 1% of the problem it is still everywhere.  Consider the following:

  1. Why do hedge fund managers need to hire placement agents and third party marketers, even when they have $1B, enough capital under management to afford building their own teams? Because many investors don’t make public what they are looking to invest in right now, don’t or can’t speak publicly about their investments, or rely upon a single database for their fund manager searches.  To show how non-transparent our industry is, I actually met someone who hire third party marketers for hedge fund managers…so in this case the hedge fund manager not only doesn’t know what investors to go to so they have to turn to a third party marketer, but now has found the third party marketing world so opaque that they hire someone else to find the third party marketer.  When I first I heard this I immediately though “this type of professional shouldn’t exist” but they so and they make a living performing this function because the market demands it.
  2. Why do conferences like our division which offers such exist? To connect peers who may have been working down the street from each other but besides a LinkedIn Group which can be filled with 100,000+ other professionals it is hard to figure out who is real, who is closing actual deals, raising capital, and is credible enough to invest time in getting to know.
  3. How is it that our small team has been able to make any progress in the field of family offices, starting with no capital and just by providing education?  Why were we able to make Endowments.com the #1 most visited website on endowment funds in the first week of acquiring it? The truth is that education in our industry is risky to provide, it could be construed as a compliance risk, as investment advice, and a regulator may fine or suspend your licenses if you make one wrong step in giving away the wrong type of advice publicly that appears to be a solicitation or lacks a needed disclosure.  In a way by providing education consistently we are picking up pennies in front of a regulatory steamroller, you hope you never get tripped up….and that is why the approach is not taken by many.
  4. Finally, why do family offices hire us to find them deal flow, to find companies to invest in.  Mostly because investment bankers, M&A brokers, and private business owners don’t have relationships with family offices, many times they don’t even know they exist. To make it more challenging many single family offices don’t have websites, don’t want to be “known” yet at the same time are frustrated by lack of deal flow.

These are just three of over a dozen examples on the tip of my tongue on how in-efficient high-finance is today and how much work is to be done providing base level education and training, insights on what is going on day to day via blog posts and videos, connecting like-minded peers through conferences, and investor databases, and finally getting deals done and capital raised through connecting parties who both benefit by being introduced to each other.  This summarizing our work in high-finance, why we see endless possibilities for how we at Wilson Holding Company can contribute and how we hope to be of value to you and your firm over the next 20 years.

Massachusetts Institute of Technology Endowment Fund

Name:  Massachusetts Institute of Technology Investment Management Company

Assets Under Management:  $15 Billion (Source:MIT)

 

Portfolio Allocation Insights:

“The firm seeks to invest a minimum of $5 million per partnership and has a net internal rate of return target of 20%. It makes its alternative investments in buyouts/corporate finance; direct investments in distressed debt and turnarounds; energy, oil, and gas; hedge funds; international private equity; limited partnership secondaries; real estate; and venture capital.”  (Source)

Management Team:

Team Member Title
Seth Alexander President
Daniel T. Steele Managing Director of Private Equity
Kathryn J. Crecelius Managing Director for Marketable Alternative Investments
Kimon G Pandapas Director of Private Equity
Debra Cobb Manager of Investment Administration

 

Contact Details:  For complete contact details for the MIT Endowment Fund investment staff please access your copy of our Endowment Database.

Background on the Massachusetts Institute of Technology Endowment Fund:

 

Our team, the Endowment Fund Association (EFA) and Endowments.com is the #1 community and most visited website dedicated to endowment fund professionals.  We provide endowment funds with buy-side co-investment and direct investment deal origination services, outsourced chief investment officer selection help,  and also provide Endowment 500 research and Endowment Database Solutions.

Top MIT Endowment Fund Headlines:

The Massachusetts Institute of Technology Investment Management Company (MITIMCo) announced today that MIT’s unitized pool of endowment and other MIT funds generated an investment return of 11.1 percent during the fiscal year ending June 30, 2013. At the end of that fiscal year, MIT’s endowment funds totaled $11 billion, including pledges. The goal of MIT’s endowment is to support current and future generations of MIT scholars with the resources they need. As such, endowment funds are used for Institute activities including education, research, capital projects, faculty work and student financial aid. The Institute’s need-blind undergraduate admissions policy ensures that an MIT education is accessible to all qualified candidates regardless of financial resources. MIT provides financial aid to meet the full cost of an MIT education, based on the calculated need of the family. In 2012-13, the average financial aid award for need-based-aid recipients was $40,952. Currently, 61 percent of MIT undergraduates receive need-based financial aid, and 32 percent of MIT students receive scholarship funding sufficient to cover the total cost of tuition. (Source)