Wall Street to West Coast

print

“To be able to be part of an institution that’s so important—in terms of educating students, as well as tomorrow’s leaders for the state, plus what it does locally for the community—those are all pretty powerful, and I’m lucky to be a part of it.” -UO Foundation CIO Jay Namyet

 

Jay Namyet, UO Foundation chief investment officer, makes a living managing uncertainty. But he’s 100 percent certain about one thing. After performing due diligence, he knows Eugene is home.

Namyet grew up in a Boston suburb, earned a degree in economics at the University of Pennsylvania and an MBA at New York University, and then found success on Wall Street—sort of.

“It was intellectually challenging,” he says. “But completely lacking in terms of a mission. You came in, tried to make some money for a wealthy firm, and you got paid if you did. There was nothing else to it. My wife, Lisa, hated the city. She said, ‘I’ll give you five years, and we’re out of here.’ Five years came and went, so we made a deal: whoever gets a job first, we’ll move there.”

She landed an advertising gig in San Francisco, so they headed west and he found a job at Smith Barney. But when the time came to start a family, they decided to search for someplace smaller—a town with the amenities of a bigger city, but without the hassles. It was the start of an epic journey to find the best college town in America.

The Namyets spent a year driving around the country in a 1986 Honda Accord, with Ginger, their 70-pound Gordon setter, scrunched in the back. They camped and stayed in motels, hitting San Luis Obispo, Flagstaff, Boulder, Charlottesville—about 50 quintessential college towns in all.

When you visit so many places, says Namyet, little things begin to stick out. Like how many drivers run red lights or honk their horns. These become proverbial canaries in the coalmine—indicators of stress and the overall quality of life. In Eugene, nobody ran red lights. They rarely heard a car horn. There was the ocean, the mountains, and the University of Oregon.

Road Trip: The Namyets spent a year exploring college towns across the country



“To be able to be part of an institution that’s so important—in terms of educating students, as well as tomorrow’s leaders for the state, plus what it does locally for the community—those are all pretty powerful, and I’m lucky to be a part of it,” says Namyet.

We’re lucky too. Though Namyet eschews the spotlight, his steady hand has successfully navigated the university’s endowment through some stormy seas—in terms of institutional change as well as market fluctuations.

Since he started in 2000, the endowment—known as the Willamette Investment Pool (WIP)—has grown, through donor gifts and the foundation’s investment strategy, from $200 million to more than $810 million. In fiscal year 2016, it returned 2.4 percent, a performance record that places us in the top 5 percent of major university endowments. In the decade ending 2016, it returned an impressive 6.4 percent annually. That puts us in the top 10 percent of our peers for performance, even as we remained in the lowest 10 percent in terms of risk. 

A university endowment also has special obligations—like providing stable financial support for the university today while maintaining its purchasing power for tomorrow. Year after year, these investments are also working to give the university greater financial independence. That means delivering performance, but also consistency and stability, and a strategy that’s less dependent on any one type of investment or particular economic environment. Over the years, Namyet’s team has risen to the occasion. 



The endowment consistently provides greater returns while assuming less risk than the appropriate benchmarks. As for resiliency, it declined less and recovered more quickly than key benchmarks during two historic market downturns: 2000–2 and 2007–9.

Established in 1922, the UO Foundation is a nonprofit corporation entrusted with approximately $1 billion in assets. Though separate from the university, its raison d’être is to manage, invest, and disperse thousands of private gifts to the UO. The WIP’s performance is measured as one endowment, but it actually comprises more than 1,400 donor-directed accounts. Each must be stewarded according to the donor’s wishes.

Quarterly distributions from the WIP support scholarships, programs, laboratories, faculty salaries, and other aspects of running a university. Currently, these dividends are based on payout that distributes about 4 percent of a fund’s market value to the university every year. Namyet and his colleagues work to make sure these distributions increase steadily, along with the value of the endowment.

What’s the secret to his success? When pressed, Namyet will point to anything and anyone other than himself: his investment team, the foundation and its board, and the university and its leadership. He also attributes it to a creative, independent, and nonconformist approach that might be called “the Oregon way.” 

“I have an independent streak, which is why I like it here,” he says. “I think that independence has made us very successful. Sometimes we’re one of just a few taking a certain approach. Investing is the oddest profession. I can’t think of another line of work where you find success doing what everyone else is not doing. Would you go to a heart surgeon who took that approach? Well, in this field, it works. Look at Warren Buffett.”


Over the years, says Namyet, he’s been delighted to discover how this maverick Duck spirit runs through the foundation and the university, as well as our state. It’s also part of what makes our students so great.

“One of our money managers from back east was on campus presenting to a business class, and I asked him how it went,” recalls Namyet. “He was amazed how much our students were comfortable simply being themselves. On the East Coast, every kid has the same script for success. Nobody deviates. But he said UO students had real personalities. Coming to Oregon from Wall Street, I knew exactly what he meant. It permeates every aspect of this place.”

Namyet credits the university, the foundation, and the trustees for creating (and following) a governance model that gives his team the independence to succeed. Based on what his peers from other institutions tell him, the way the foundation and the university operate makes other endowment managers a bit envious.

“In 2016, we won an award, from a jury of our peers, for governance,” he says. “I know we don’t brag a lot about that. It’s not an award like Pac-12 defensive player of the year. But I am proud of it. Our donors should take comfort in it too. The take-home message is that this is more than just one person’s effort. We have an incredibly talented group of dedicated employees who could work anywhere. They’re best of class at what they do.”

Having a sophisticated board that brings tremendous intellect, passion, and experience to the table—but also offers autonomy—is critical, says Namyet. Managing investments becomes less about ego, short-term performance, or looking just like one’s peers and more about maintaining the purchasing power of the endowment and fulfilling the overall university mission.

In short, he says, everyone is simply focused on the big picture. By concentrating on excellence, the foundation can accomplish its ultimate goal of supporting the university.

“What’s kept me here 17 years is passion for the mission,” says Namyet. “Both my parents were educators, and so I was raised to appreciate the value of an education. I want to use my investment skills to help fund education. From my perspective, that’s the highest calling.”

—Ed Dorsch, BA ’94, MA ’99


Investing the Age of Climate Change

In April, 2017, Jay Namyet joined UO students and faculty and staff members to tackle questions about how climate change is affecting businesses and investors. 

:: Watch Video