Bill SpitzIn the 22 years that William Spitz served as treasurer and cio of Vanderbilt University, the school’s endowment grew to $3.5 billion from $300 million and became much more diversified. He pioneered the concept of a more flexible, broader approach to asset allocation, which several other endowments have since emulated. Spitz, FEMM’s 2008 Lifetime Achievement Award recipient, will be honored at an awards dinner in Phoenix Sept. 21.
Bill Spitz
Spitz, who retired last August, attributed the growth of Vanderbilt’s assets to a long equity bull market and early investments in private equity, which Vanderbilt got into even before he joined. Vanderbilt invested in Sequoia Capital in the late 1970s and was also an early investor in Kleiner Perkins Caufield & Byers. When Spitz came in, he ramped up Vanderbilt’s then-small investments in venture capital, real estate and international equity and added timber, energy and hedge funds.
“Bill had a wonderful knack of knowing how to take seeds and make them grow,” said K. Beth Johnson, senior consultant at Hammond Associates and a former investment director at Vanderbilt. “More than once he accepted investment allocations of insignificant portfolio value in highly oversubscribed investment funds. Those small investments subsequently bloomed into larger positions with top tier firms.”
Like most endowments, Vanderbilt used to structure its asset allocation into style boxes, but Spitz found a lot of strategies didn’t easily fit. “It became very arbitrary in [terms of] where you put things,” he said. He decided that the endowment wanted good managers, and “if we can find them we should put them in, regardless of whether we have a spot in a bucket.”
Spitz also wanted to take advantage of his investment team’s views on how the portfolio should be tilted tactically. In 2006, Vanderbilt did away with regional style and capitalization parameters for equity, instead creating one broad global equity allocation that could include long/short. It subsequently did the same with real assets and hedge funds. Spitz spoke to peers about these moves at conferences and in his writings.
Baylor University has adopted a similar approach. CIO Jonathan Hook said Vanderbilt was among the endowments he studied before redesigning his asset allocation. He credited Spitz for always chasing new ideas. “He seemed willing to be different,” said Hook. “He was not afraid to look at things from a different perspective and not just paint things the way the consensus said they should be painted.”
Spitz serves on the investment committee of Kenyon College, which his daughter attends. He assisted its $180 million endowment to establish a 15% allocation to opportunistic investments.
Spitz has remained an active member of the investment industry. He has been invited to join Oxford University’s investment committee and has joined the boards of Cambium Global Timberland, Acadia Realty Trust and MassMutual Financial Group. Spitz spent 11 years on the board of Commonfund, four of them as chair. In that time he helped to professionalize the firm and establish procedures and controls.
While working at Vanderbilt, Spitz taught at the Vanderbilt Owen Graduate School of Management. Since leaving, he has written two case studies of Vanderbilt’s investments for Harvard Business School. He has also written two investment advice books, Get Rich Slowly and Save Smart for a Secure Future.
Earlier in his career, Spitz spent 11 years at NSR Asset Management and Wertheim & Co. He is also the founder and director of Diversified Trust Co.
Spitz received Hirtle, Callaghan & Co.’s 2005 Award for Investment Leadership in recognition of his integrity, ethical standards and unerring investment judgment, as well as his achievements in diversifying Vanderbilt’s portfolio.