Paula J. Volent ’97 began working with the legendary investor and late Yale endowment manager David Swensen during her time at Yale SOM. Before leaving the Yale Investments Office a few years later, she helped Swensen write his book Pioneering Portfolio Management: An Unconventional Approach to Institutional Investment, which revolutionized endowment management and is celebrating its 25th anniversary this year. Volent went on to direct endowments at Bowdoin College and Rockefeller University.
In January 1998, David Swensen asked if I could postpone taking a position in the finance office at Disney by six months to assist him in writing a book about investments. Charley Ellis, a passive investing expert and SOM faculty member who chaired the university’s investment committee alongside David, had been pestering him to write about his “unconventional” approach to investing and his success, since his arrival at Yale as CIO in 1985, in managing the Yale Endowment. David finally agreed to sit down and write about his approach to investing.
He was motivated to share his underlying philosophy on investing with peer endowments, reflecting his enduring commitment to enhancing the missions and financial stability of colleges, universities, and foundations. The 6 months ended up being 18 months, during which I had the incredible opportunity to work with David on bringing together his philosophy and ideas into a book that would become an investment classic. David was a connoisseur of beautiful writing instruments, and every Monday a yellow pad of paper with elegant handwriting would land on my desk so I could begin the task of organizing chapters and doing research to verify and augment David’s writing. I spent many days in the Yale and Harvard archives, tracking down early endowment data and anecdotal information around approaches to the management of college and university finances.
We went deep into discussions with peers and regulators on subjects ranging from soft dollars to opportunities in emerging markets and new asset classes. Creative and editorial insights in the writing of the book often occurred during train rides to and from visits with many of Yale’s external managers, during which we would edit and rework chapters, always with attention to detail and writing style. The work on the book was a labor of love for David and a collaborative endeavor. As the book took shape we reached out to many colleagues: late night conversations with Larry Hoagland and Anne Cascells at Stanford, visits with Marty Liebowitz at TIAA, long conversations with Miles Moreland at Blakeney, and of course regular check-ins with Charley Ellis. The economist John Maynard Keynes was always there in spirit, particularly in his comment: “Worldly wisdom teaches that it is better for reputation to fail conventionally than to succeed unconventionally.” This quote informed the sub-title of Pioneering Portfolio Management. Wrapping up the manuscript with the assistance of the editorial team at the Free Press and seeing the final printed book was very exciting for David, and you can imagine what it meant to me. It was an amazing 18 months!
