Key Takeaways
- • Yale University confirmed it is exploring a sale of private equity fund interests on the secondaries market, advised by Evercore, in a process that has been underway for many months, according to a University spokesperson.
- • The transaction could total up to $6 billion in value, per Secondaries Investor, though Yale has not specified a target size.
- • The potential sale would be Yale's first known secondaries transaction, and comes as the endowment, valued at $41.4 billion at the end of fiscal 2024, faces tighter budgets due to low recent returns.
- • Yale's 10-year return of 9.5 percent ranks second among the eight Ivy League endowments, but returns over the past three fiscal years have fallen short of the 8.25 percent spending threshold.
- • The University reaffirmed its commitment to private equity, which makes up a major share of an endowment where roughly 95 percent is invested in alternative assets.
Summary
Yale University is considering selling a portfolio of its private equity fund interests on the secondaries market, a University spokesperson confirmed to the Yale Daily News. The University did not specify a target size, but Secondaries Investor reports the transaction could total up to $6 billion in value. In an email to the News, the spokesperson wrote that Yale "is exploring a sale of private equity fund interests and is being advised by Evercore in a process that has been in the works for many months." Evercore is an independent investment bank with financial research, institutional asset management and private equity investing operations.
According to Secondaries Investor, the sale would be Yale's first known transaction on the secondaries market, where investors buy existing fund stakes from other investors rather than purchasing stakes directly from private companies. The move would allow Yale to convert illiquid private equity holdings into more readily spendable assets. The endowment stood at $41.4 billion at the end of fiscal 2024.
The sale follows Yale's announcement that its budget for fiscal 2026 would be "far more constrained" due to low endowment returns. Although Yale's 10-year investment return of 9.5 percent places it second among the eight Ivy League endowments, its short-term performance has lagged. Annual investment returns for the past three fiscal years have not reached the 8.25 percent needed to sustain current endowment spending. Yale administrators also cited proposed federal measures, including higher endowment taxes and reduced research funding under the Trump administration, as threats to its finances. The University has already cut spending on faculty raises, hiring, campus construction and other non-salary expenditures.
The University emphasized its continued commitment to private equity. "We remain committed to private equity investments as a major part of our investment program and continue to make new commitments to funds raised by our current investment managers," the spokesperson wrote, adding that Yale continues to seek new relationships with private equity firms. Yale's strategy has diversified away from U.S. equities and bonds toward private equity, venture capital, hedge funds and real estate, with roughly 95 percent of the endowment in alternative assets as of last year's report.
According to Secondaries Investor, the sale would be Yale's first known transaction on the secondaries market, where investors buy existing fund stakes from other investors rather than purchasing stakes directly from private companies. The move would allow Yale to convert illiquid private equity holdings into more readily spendable assets. The endowment stood at $41.4 billion at the end of fiscal 2024.
The sale follows Yale's announcement that its budget for fiscal 2026 would be "far more constrained" due to low endowment returns. Although Yale's 10-year investment return of 9.5 percent places it second among the eight Ivy League endowments, its short-term performance has lagged. Annual investment returns for the past three fiscal years have not reached the 8.25 percent needed to sustain current endowment spending. Yale administrators also cited proposed federal measures, including higher endowment taxes and reduced research funding under the Trump administration, as threats to its finances. The University has already cut spending on faculty raises, hiring, campus construction and other non-salary expenditures.
The University emphasized its continued commitment to private equity. "We remain committed to private equity investments as a major part of our investment program and continue to make new commitments to funds raised by our current investment managers," the spokesperson wrote, adding that Yale continues to seek new relationships with private equity firms. Yale's strategy has diversified away from U.S. equities and bonds toward private equity, venture capital, hedge funds and real estate, with roughly 95 percent of the endowment in alternative assets as of last year's report.
Go deeper than the headline
Research every firm in this story, track the ones that matter and get the daily briefing — free for 7 days.