Commonfund: About

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History

The founding of Commonfund is one of the exciting stories of innovation in financial institutions. To understand why, return to the late 1960s. In this era, investment returns from college endowments persistently lagged the rate of growth in operating budgets. There was increasing concern throughout higher education regarding the future vitality of private institutions. And, many institutions faced problems of faculty compensation and deferred maintenance. A final challenge was that traditional endowment management hampered trustees’ ability to address these issues.

But change was in the air. Thought leaders of the day were looking at the then-new concept of total return and thinking about relaxing the old personal trust discipline and allowing a college to set its own spending rate. One study, Managing Educational Endowment, concluded that poor results were due to placing a primary emphasis on avoiding losses and maximizing current income. The Ford Foundation sponsored a landmark study, The Law and the Lore of Endowment Funds, published in 1969, that served as a further catalyst for action.

Out of this came a Ford Foundation grant of $2.8 million for the founding of The Common Fund for Nonprofit Organizations (Commonfund). Two years later, in 1971, The Common Fund was officially founded. Of the $2.8 million, $500,000 was earmarked for research and publications — a tradition that continues today. By July 1, 1971, the first day of operations, a total of 63 endowments had invested $72 million. We also launched our first investment fund, the Multi-Strategy Equity Fund.

Milestones

Over the years, Commonfund has grown and expanded the range of investment funds and supporting services it offers its nonprofit clients. Along the way, key milestones in the history of Commonfund include:

1971	“The Common Fund” commences operation (the organization adopted the trade name “Commonfund” in 1998) The first fund, the Multi-Strategy Equity Fund, is launched
1973	First research report published, creating a continuing legacy of research and publications
1974	Introduction of Short Term Fund
1976	Introduction of first endowment fixed income fund, the Multi-Strategy Bond Fund
1982	Early leader in diversifying equity portfolio using hedging strategy
1983	International Equity Fund launch establishes Commonfund as a pioneer in international investing
1985	Launch of Global Bond Fund takes Commonfund into foreign fixed income markets
1986	Intermediate Term Fund launched
1988	Commonfund Capital, Inc. and Commonfund Realty, Inc. (originally combined as Endowment Advisers, Inc.) are created to access opportunities in venture capital, domestic private equity, international private capital, energy and commercial real estate The Allocation Planning Model (APM), a computerized tool for simulating endowment performance under a range of asset allocation variables, is developed and made available to clients
1989	Commonfund Capital launches first energy fund Commonfund makes first investment in distressed debt as an allocation within the Multi-Strategy Bond Fund
1991	Commonfund enters alternative investments area with introduction of predecessor to Absolute Return Fund
1992	A series of focused equity and fixed income funds introduced
1993	Development of Endowment Institute, a seminar for senior financial officers and trustees held annually Launch of initial online access tools
1994	Commonfund expands presence in alternative investments with introduction of Hedge Fund
	Small cap equity funds introduced
1996	Commonfund Prize for investment research is announced
1997	First generation Web site is unveiled
	Online transaction services, Portfolio Access and Treasury Access, are introduced Purchasing card program is launched
1998 1999	The subsidiary Commonfund Securities, Inc. is created The subsidiary Commonfund Asset Management Company is created Relocation to new corporate headquarters in Wilton, Connecticut Expansion to provide service to Canadian educational institutions Mission broadened to include nonprofit foundations and healthcare organizations Second generation Web site is launched
2000	Treasury Institute and Commonfund Institute are formed
	First Commonfund Forum is held
2001	Commonfund Benchmarks Study^® is published About $30 billion in assets under management
2003 2004 2007	Passed $13 billion investment mark in the Short Term Fund Strategic Solutions^® reached 20 clients and $1.3 billion in assets Passed $40 billion in assets under management Over 1,800 clients

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