One Boston-area college's endowment saw nearly $1.2B growth this year
Anthony D'Isidoro
Boston College
Chestnut Hill, Mass.
Total undergrad enrollment: 9,901
10-year change in price: 39% increase
10-year inflation rate year-over-year: 17.3% increase
Total price of attendance: $78,572
Ranked 22nd most expensive college in the U.S.A
(Ranked by total estimated cost of attendance for students living on campus in most recent academic year)
One Boston-area college's endowment saw nearly $1.2B growth this year (Grant Welker, Boston Business Journal: October 4, 2021)
Generous investment returns have led to leaps in endowment sizes at Boston College and Boston University, two schools with some of the deepest pockets in the Boston area.
BC’s endowment grew by nearly $1.2 billion, or 46%, over the past year to hit nearly $3.8 billion. BU’s endowment rose by $971 million, or 40%, to reach nearly $3.4 billion.
Those increases come as colleges have both reaped significant investment returns and enjoyed fundraising drives that in many cases have exceeded even colleges’ own goals.
PitchBook, a firm that tracks venture capital, private equity and other markets, said in a report that venture capital is a major factor in schools’ substantial gains in the past year.
“These top-performing endowments can thank alternative assets — in particular, venture capital — for the banner year, which is said to be the best since 1986,” PitchBook said.
The median endowment gain in the past year was 27%, PitchBook reported, citing Wilshire Trust Universe Comparison Service data.
A reliance on venture capital for returns can be risky though, PitchBook said. Endowments are geared toward helping schools with funding in perpetuity, while high valuations today for many startups may not last in the years to come.
Endowments aren’t involved in private equity in the same way, either. A report this year by the National Association of College and University Business Officers found that endowments of $1 billion or more put nearly 26% of their allocations in private equity or venture capital. For endowments below $250 million, it was 7% or less.
Harvard University and the Massachusetts Institute of Technology, the former with the country’s largest endowment and the former with a top-10 endowment, have yet to report their 2021 figures. The two Cambridge schools have endowments that collectively totaled nearly $60 billion last year.
Harvard President Lawrence Bacow said in September it will phase out investments in fossil fuel-industry companies, a move that was cheered by environmental advocates.
Deep-pocketed colleges in the Boston area have already been bringing in far more in donor giving during a long economic growth period before the pandemic.
MIT’s most recent campaign that ended in September brought in $6.2 billion, far more than its $5 billion goal, Harvard ended a campaign in 2018 having raised more than $9.6 billion, and in 2019 BU said it raised more than $1.8 billion in a campaign in which it hoped to raise $1 billion. Elsewhere, Tufts University is in the midst of a $1.5 billion fundraising program, and Wellesley College reached a $500 million goal a year ahead of schedule.