Higher costs and higher rates of endowment spending are the major story lines of the 2023 Endowment Radar Study. In 2023, the endowment provided a stable source of funding for the growing costs of private college and university business model (Figure 1). The four components of Endowment Radar measure the endowment’s role in supporting the […]
March 2024
In today’s dynamic funding and operating environment, a lot is at stake for public colleges and universities and their endowments. The public university endowment is more than a static funding source; with strong stewardship, a growing endowment can transform a university’s financial equation. The most forward-thinking public universities use their endowments for far more than […]
January 2024
Inflation is having a moment. After laying low and playing a minor role in institutional financial decisions for decades, inflation has soared, dominating headlines and raising expectations for future costs. In addition to its impact on financial markets and investment portfolios, inflation increases the costs of delivering the nonprofit mission and makes it more challenging […]
May 2023
Endowment Radar is a methodology that Cambridge Associates developed to visually evaluate the endowment’s role in the college and university enterprise. The four components of Endowment Radar measure the endowment’s role in supporting the annual budget (Endowment Dependence), pricing strategy (Endowment Support-to-Financial Aid), balance sheet health (Endowment-to-Debt), and financial sustainability (Net Flow Rate). Our 2022 […]
March 2023
An increasing number of institutions and families are electing to spend down their assets during a limited time period. Why? Some causes—such as climate justice—feel urgent to donors and they respond with more immediate action. Other donors believe greater financial support today through a spend-down fund compounds their impact, leading to better outcomes in totality compared to providing […]
January 2023
Where Do We Start? An institution considering initiating or adding to a mission-aligned investing strategy must first define its objectives. Next, it should evaluate the available approaches and tools on portfolio structure, impact, and performance expectations. Any planned changes must be balanced with the need to continue support for ongoing operations and grantmaking activities. Drawing […]
November 2022
Endowment Radar is a methodology that Cambridge Associates developed to visually evaluate the endowment’s role in the college and university enterprise. The four components of Endowment Radar measure the endowment’s impact on budget funding (Endowment Dependence), pricing strategy (Endowment Support-to-Financial Aid), balance sheet health (Endowment-to-Debt), and an indicator of future purchasing power (Net Flow Rate). […]
April 2022
While colleges and universities have faced several financial fissures due to the disruptions of COVID-19, their endowments have been a source of financial stability. Four key financial indicators tell this story: operating margins were compressed, tuition discounts grew, institutions borrowed more debt, and endowment spending was consistent. In this note, we review these financial pressures and the endowment implications that emerged in Cambridge Associates’ second annual Endowment Radar Study of private college and university finances.
April 2021