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Yale’s Endowment Selling Private Equity Stakes as Trump Targets Ivies

Published

6 months ago

June 10, 2025

Yale’s Endowment Selling Private Equity Stakes as Trump Targets Ivies

Yale University’s famed endowment has been trying to offload one of the largest portfolios of private equity investments ever in a single sale, a move that reflects the pressures on both Wall Street and higher education under the Trump administration.

The Ivy League school has sought buyers for up to $6 billion in stakes in private equity and venture funds, according to three people briefed on the sales process, amid uncertainty about its federal funding and the reality that many of these investments have not delivered the outsize returns that Yale expected.

Yale is now close to completing a sale of roughly $3 billion of the portfolio and is selling the assets at a slight discount, one of the people said.

“This is a big deal,” said Sandeep Dahiya, a professor of finance at Georgetown University who has conducted research on the performance of endowments. “The investor that was the lead architect of investing in the private equity markets is pulling in its horns.”

For decades, Yale has been regarded as a pioneer for shifting its investments away from stocks and bonds into longer-term holdings managed by private equity and venture capital firms. But last year, Yale’s $41 billion endowment generated returns of just 5.7 percent, underperforming the S&P 500 and other major indexes. Yale said its 10-year return averaged 9.5 percent annually.

Private equity investments typically generate cash for endowments and other investors after they sell or take public the companies in which they have invested. But lately, private equity and venture firms, which make up about half of Yale’s endowment, have struggled to sell their stakes in companies and return cash to investors. That has driven down returns.

Yale’s quest to exit investments in both well-known firms like Bain Capital and lesser-known ones like Golden Gate Capital, Clayton Dubilier & Rice and Insight Partners is a sharp U-turn for an endowment that has long proselytized the value of private equity and other long-term investments.

Knowing that some stakes would be harder to sell than others, Yale’s bankers offered potential bidders two separate lists of funds: “core” funds, the ones they most wanted to sell, and “sweeteners,” the better-performing ones, according to two of the people briefed on the sale.

While buyers would receive only a small discount of about 5 percent on the private equity stakes, Yale willingness to sell assets that were once highly desirable at less than full value reflects the industry’s challenges.

The sale comes at a critical juncture for universities. While President Trump has spared Yale the kind of punitive funding cuts he has leveled against other Ivy League schools such as Harvard, Yale is grappling with decreases in federal research funding that have hit higher education broadly. Republicans in Congress have also proposed steep tax increases on endowments.

Yale is on track to spend roughly $2.1 billion from its endowment in 2025, which accounts for just over one-third of its annual budget.

In a statement provided to The New York Times, a representative for the Yale endowment acknowledged the sale, but called private equity “a core element of our investment strategy.” The statement added, “We are not reducing our long-term target to private equity.” The university said it was also looking to invest in other private equity firms.

Yale’s bankers tried to keep the process discreet by giving the sale the code name Project Gatsby. (Two of the main characters in F. Scott Fitzgerald’s novel set in the roaring 1920s went to Yale.) But Yale’s move is widely viewed on Wall Street as a harbinger.

At least two other large universities are preparing to sell some private equity assets, and dozens of U.S. and Asian pension funds are also looking at exits.

Lawrence Siegel, a former director of research at the Ford Foundation, called Yale’s move “a wake-up call” for investors.

“It’s also Yale trying to get out before everyone else,” Mr. Siegel said.

The Swensen Model

When David Swensen, a former Lehman Brothers banker, joined Yale as its chief investment officer in 1985, the university’s endowment was valued at about $1.3 billion. (Harvard’s had $2.7 billion.)

During 2021, the year that Mr. Swensen died, Yale’s endowment had swelled to $42.3 billion, behind Harvard but billions ahead of almost every other university endowment.

To achieve that, Mr. Swensen shifted Yale’s investments from a traditional portfolio of 60 percent stocks and 40 percent bonds. After getting to know fund managers in private equity and venture firms, Mr. Swensen moved a relatively large slug of Yale’s endowment into long-term assets, often investing in those funds for decades.

Other universities watched Yale’s returns and started to follow the Swensen Model, as it came to be known.

Yale’s early affection for private equity provided the perfect advertisement for an industry looking to attract new investors.

“Do you want to be smart like Yale?” said Ludovic Phalippou, an economist at the University of Oxford, in describing the pitch.

University endowments now invest an average of about 17.1 percent of assets in private equity funds, according to studies by the National Association of College and University Business Officers. That’s up from just 5.4 percent in 2007 before the financial crisis.

Universities and private equity firms have developed a symbiotic relationship. Endowments typically pay private equity firms roughly 2 percent of the money they manage and 20 percent of the profits they generate.

Those fees have helped mint slews of billionaires, many of whom sit on university boards and make large donations to the schools.

Yale’s senior trustee, for example, Joshua Bekenstein, has worked at Bain Capital since its inception in 1984, four years after he graduated from Yale. The Boston-based firm was one of the earliest to jump into the buyout business. It scooped up companies like Dunkin’ Donuts, Clear Channel Communications and Gymboree, added debt and then tried to sell them for a profit. Gymboree, a children’s clothing retailer, filed for bankruptcy seven years after Bain bought it.

Bain now manages $185 billion, including at least roughly $1 billion for Yale.

For more than a decade after the financial crisis, U.S. private equity firms reliably generated average returns, on paper, in the mid- to high teens, according to the data provider PitchBook. But the firms generated average returns below 10 percent in 2022 and 2023, and just over 10 percent in 2024.

Another challenge: Deal making has been slow for several years, and private equity firms have had difficulty selling stakes in companies and returning cash to investors at levels reached in previous years. Despite optimism that the second Trump administration would spur a deal-making resurgence, the volatility around tariffs has made companies wary.

In 2024, the firms returned about 15 percent of the value of their funds to investors in cash, compared with between 25 and 35 percent in prior years, PitchBook data shows.

The winnowing returns come after private equity firms, from 2021 to 2024, raised record sums from pensions, endowments and sovereign wealth funds, PitchBook data shows.

Steven Meier, chief investment officer for the New York City Retirement System, acknowledged that returns for private equity “haven’t been great.”

The system, which manages a $280 billion investment portfolio for the pensions of teachers, firefighters and other public employees, just sold $5 billion of its stakes in private equity firms. Mr. Meier said the city would continue investing in private equity but was looking to pay lower fees.

He added that the funds’ recent returns to pensions and endowments had also been “disappointing.”

Project Gatsby

When Yale’s bankers at Evercore Partners began shopping the endowment’s private equity portfolio in April, they didn’t disclose the seller’s identity.

But they left a clue: They called the sale Project Gatsby.

Bidders were asked to select funds from a combination of the “sweetener” and the “core” pool of assets and to name their price by May 6, with Yale’s bankers aiming for a June 30 closing, according to sales documents viewed by The Times.

Some details of Yale’s sale were reported earlier by Secondaries Investor and Bloomberg.

The biggest single position that Yale has been shopping is a roughly $600 million stake in a 2007 fund run by Golden Gate Capital, a San Francisco-based private equity firm known mostly for investing in retailers like Ann Taylor, Eddie Bauer and PacSun. Two people familiar with the sale said Yale did not expect to sell the entire stake.

The Golden Gate stake was marketed as part of the core portfolio, among the assets that the bankers most wanted to sell.

Evercore’s bankers also offered stakes in Insight Partners and General Catalyst. At least one stake that was labeled a “sweetener,” Clayton, Dubilier & Rice, was not expected to be sold because Yale has been able to get the price that it wanted on other stakes, according to two people familiar with the sale.

Yale has also been offering to sell nine funds managed by Bain Capital, with a total value of about $1 billion. A person familiar with the deal said the school was on the verge of selling about $500 million worth of those Bain stakes.

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Business

Why are California’s Indian truck drivers disappearing during the holiday rush?

Published

10 hours ago

December 1, 2025

Press Room

Why are California’s Indian truck drivers disappearing during the holiday rush?

It is supposed to be the busiest time of year for the Roadies trucking company, but dozens of its trucks sit idle — unlikely casualties of a surprise scrutiny of laborers from India.

The Bakersfield company has 200 big rigs but a dearth of drivers after authorities canceled thousands of commercial driver’s licenses in California, forcing more than 20 Roadies drivers out of the business and spooking others into quitting.

A Roadies truck leaves for a delivery past unused parked trucks in Bakersfield.

(Myung J. Chun/Los Angeles Times)

Chief Executive Avninder Singh says he has doubled pay, but still can’t recruit enough drivers. He says he is now losing more each month than he usually makes in a year.

“My trucks are sitting,” with no one to drive them, he said. “It has put my livelihood in danger.”

Outside of tech, medicine, and family businesses, truck driving is one of the largest sources of employment for the Indian diaspora in America. Indian truckers say they are being unfairly targeted after a horrific accident triggered extra scrutiny of migrant drivers and tighter regulations.

Some drivers — many of whom claim to have fled persecution in India and requested asylum in the U.S. — are sitting on expensive investments they cannot use. Joban Singh, 27, based in Bakersfield, spent $80,000 to buy a truck because even though truck driving is a tough life, it provides a steady income to support his family.

“We have invested everything in trucking, thinking it’ll be good for us,” he said. “Now if we have our licenses canceled, who will buy these trucks and trailers from us?”

Singh is a common surname in the Sikh community from India’s state of Punjab. None of the people mentioned in this story are related.

Punjabi Sikh truckers have emerged as the backbone of the American trucking industry. For decades, many have sought asylum in the U.S. and entered the transportation industry.

There are around 750,000 Punjabi Sikhs in the United States. Of those, about 150,000 work in the trucking industry, with the majority based on the West Coast.

The more devout Sikhs sport turbans and beards as symbols of their faith, which is neither Hindu nor Muslim. This can make them a target on the road, says Manpreet Kaur, the vice mayor of the city of Bakersfield.

“The Sikh community within trucking is really being squished in the middle of a battle between the state of California and the federal government,” said Kaur, whose father was a truck owner and operator.

Instances of racism and racial profiling of the community have risen, with Indian truckers reporting incidents of doors getting slammed in their faces and racial slurs being used at truck stops.

“Feeling a sense of not belonging in a place where you have worked, earned, contributed, [and where] your children have grown up,” is convincing drivers to leave the industry, she said. “All of a sudden, because of the decisions of one administration, the hate is presenting so strongly.”

The surge in negative attention started in August when three people were killed in an accident in Florida after an Indian driver with a license from California allegedly made an illegal U-turn.

The Trump administration blamed California for failing to enforce English proficiency and other driver requirements. In September, the Trump administration issued an emergency rule to try to shut down the issuance of commercial driver’s licenses to noncitizens

Members of the Sikh community gather to support a truck driver accused of manslaughter and vehicular homicide in Florida.

The Department of Transportation put pressure on California, revoking $40 million in federal funding for failing to enforce English proficiency tests and threatening to cut additional federal support.

Last month, California’s Department of Motor Vehicles announced plans to revoke 17,000 commercial driver’s licenses issued to immigrants. The licenses were canceled, the DMV said, because they were set to expire after the time the migrants were legally allowed to remain in the U.S.

Sukhdeep Singh, owner of Cali Brothers Truck Lines, which has 60 trucks and is based in Merced, said 10 of his Sikh drivers quit last month. They have valid licenses and work papers, but are afraid to go back on the road, worried that if they get stopped, they could get sent home.

“They don’t want to drive anymore,” he said.

About 25 of Roadies’ truck drivers received the cancellation notice. The company is now losing hundreds of thousands of dollars in revenue each month as its clients go elsewhere.

Policy changes regarding noncitizen commercial licenses and English language proficiency enforcement could remove more than 400,000 commercial drivers from the market over the next three years, according to J.B. Hunt, one of the largest trucking companies.

Some say the driver shortage concerns are overblown and that there are enough U.S. citizens to meet the demand for drivers if they are given sufficient training and salaries.

“I do not buy the idea that there aren’t enough American truck drivers to meet demands in this country,” Transport Secretary Sean Duffy said in an October news conference. “I think you will see American truck drivers fill the space when we do what is right and take out these unlawful drivers.”

A man walks in front of a set of semi trucks.

Advocacy groups such as the American Trucking Assn., which in the past has lobbied for looser licensing rules to address driver shortages, have backed the tighter restrictions.

Regulators need to enforce rules requiring truckers to be well-trained and qualified, said ATA Chief Economist Bob Costello.

“Qualified means you can speak English, read road signs, understand safety rules and respect our laws,” he said. “Qualified means you earned your CDL the right way, not through a rubber-stamped process in a state that looks the other way.”

Companies that rely on Indian truckers may have to reconsider their business model.

The trucking industry is packed with small carriers operating 10 or fewer trucks. Most have been operating for years without incident, but many could now go out of business as they wait for the new normal to emerge.

“I am excited about the holiday season,” said Sukhdeep Singh of Cali Brothers Truck Lines. “But for the truckers, it’s not bringing any happiness.”

Business

‘Zootopia 2’ hops to the top of the box office this Thanksgiving weekend

Published

23 hours ago

November 30, 2025

Press Room

‘Zootopia 2’ hops to the top of the box office this Thanksgiving weekend

Animated movie “Zootopia 2” hopped to the top of the box office in a big weekend for family-friendly films.

The sequel to the 2016 film from Walt Disney Co. brought in $156 million in the U.S. and Canada over the five-day Thanksgiving weekend, according to studio estimates. The film’s production budget was estimated at $175 million to $200 million.

In total, “Zootopia 2” collected $556 million in global box office revenue, including $272 million in China, a once-massive market for Hollywood films that has cooled in recent years. The haul for “Zootopia 2” in China marked that country’s highest opening ever for a nonlocal animated movie.

The movie probably benefited from its strong franchise recognition in China; Disney opened a “Zootopia”-themed land at Shanghai Disneyland in 2023 and embarked on an extensive marketing campaign before the film’s release. The original film had a total box office haul in China of $236 million.

Universal Pictures’ “Wicked: For Good” came in second at the domestic box office with a five-day total of $93 million.

The period between Thanksgiving and Christmas has traditionally been an important time for studios and theaters to attract moviegoers with family-friendly fare or blockbusters, which can provide a big chunk of the year’s box office revenue.

“Zootopia 2” and “Wicked: For Good” were seen as two of the major films released toward the end of the year that could drive massive ticket sales. The third — Disney’s 20th Century Studios’ “Avatar: Fire and Ash” — will be released in theaters next month.

The reception for “Zootopia 2” and “Wicked: For Good” also points to the demand for family films. Though the overall box office has been uneven this year, films geared toward children and families have largely performed.

Disney’s live-action adaptation “Lilo & Stitch” brought in more than $1 billion in global box office revenue and Warner Bros.’ “A Minecraft Movie” wasn’t far behind, with nearly $958 million.

Business

The L.A. Auto Show ends this weekend. Here are new EVs you can buy today

Published

2 days ago

November 29, 2025

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The L.A. Auto Show ends this weekend. Here are new EVs you can buy today

Thousands of people are expected to converge in downtown L.A. as this year’s Los Angeles Auto Show wraps up on Sunday. The event at the Los Angeles Convention Center is one of the oldest and largest auto exhibitions in the nation and features hundreds of new vehicles and concept cars, including the latest in EVs.

EVs always feature prominently at the L.A. Auto Show, and this year there were again new ones available for purchase in addition to those that carmakers are still planning. The show has long leaned on California’s reputation as a climate leader to launch the latest in electric technology. This year it comes at an important moment. The Trump administration has ended rebates that lowered the price of EVs, aiding the oil industry. It’s unclear what effect that will have on sales.

Electrifying vehicles is one of the main ways governments, including California’s, address climate change. The state has committed to 100% decarbonization by 2045 and has prioritized the transition away from smog- and pollution-forming combustion engines.

Among the EVs exhibited this year are the 2026 version of the Nissan Leaf, which now offers an estimated 303 miles of range on a charge, and the Chevy Bolt, which offers an estimated 255 miles of range. The Bolt is returning due to “popular demand,” after being discontinued in 2023, company officials said. The starting retail price for both cars is around $29,000.

The auto show also saw new models debut, including the 2026 Jeep Recon — a Wrangler-style EV advertised by the company as “the only fully electric Trail Rated SUV” — that offers 230 miles of range starting at $65,000. The range for the new Hyundai Ioniq 6 N has not yet been announced but is expected to land around 257 miles when the car comes to market early next year.

Luxury EVs on display include the $77,000 Rivian RIS and the $80,000 Lucid Gravity, with estimated ranges up to 410 and 450 miles, respectively. (Rivian also displayed its upcoming R2 — a smaller SUV with a promised price of $45,000 that is expected to offer more than 300 miles of range.)

In addition to canceling rebates on new and used EVs, the Trump administration has moved to block California’s landmark ban on the sale of gas-powered cars, prompting a lawsuit from the state in return.

The administration’s actions pushed many consumers to snap up EVs before the federal incentives expired, with California reporting a record number of zero-emission vehicle sales in the third quarter of 2025 — just shy of 126,000, or about 29% of new car sales.

However, the headwinds coming out of Washington, D.C., also appear to be giving some automakers pause. Brands such as Acura, Ford and GM in recent months have announced plans to discontinue some electric models and scrap plans for new ones. The climate reporting website Heatmap noted that there was an absence of enthusiasm for EVs at press events surrounding this year’s L.A. Auto Show, and that “fanfare over the electric future was decidedly tamped down.”

In October, the first full month after the repeal of the federal tax credit, EVs accounted for just 5.2% of new vehicle retail sales in the U.S., according to consumer insights company J.D. Power. The number represented a notable tumble from the all-time high of 12.9% in September.

The forecast for November is mostly the same, with EVs expected to represent about 6% of national car sales.

Still, many in the industry believe the lull will amount to little more than a bump in the road.

“The strong will survive, so the ones who make really good EVs that are priced right, you’ll see them bounce back,” said Ed Loh, head of editorial with Motor Trends, in an interview with Fox Business at the L.A. Auto Show.

The show also comes as California continues to ramp up its EV charging network. The state in September surpassed 200,000 fully public and shared EV charging ports — an increase of about 20,000 since March, according to the California Energy Commission. There are now more charging ports than gas pumps.

Gov. Gavin Newsom also reaffirmed the state’s commitment to electric vehicles with a June executive order on reducing vehicle emissions and funding for clean manufacturers, among other items.

What’s more, the global picture for EV remains bright. The International Energy Agency reported 17 million electric car sales worldwide in 2024, a roughly 25% increase over the year prior.

Sales in 2025 are expected to exceed 20 million, or more than a quarter of cars sold worldwide.