YouTube networks huge investment gains for nonprofits: foundation endowments get cut of $1.65b pie.Everyone's heard the story of the little old lady who 60 years ago bought stock in a little company called IBM (International Business Machines Corporation, Armonk, NY, www.ibm.com) The world's largest computer company. IBM's product lines include the S/390 mainframes (zSeries), AS/400 midrange business systems (iSeries), RS/6000 workstations and servers (pSeries), Intel-based servers (xSeries) , or the one about two guys who started their computer company in a Silicon Valley garage. The updated version of that story for the new millennium centers around two young men who started an online video-sharing Web site and sold it within two years for more than $1 billion. When YouTube was purchased by Google for $1.65 billion last year, it instantly turned its founders into 20-something multi-millionaires. It also yielded a healthy return for foundations and endowments around the world. The New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of City-based Ford Foundation was among the biggest winners in the YouTube transaction, getting almost 220,000 shares of Google, according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. a recent filing with the Securities and Exchange Commission (SEC). Most foundations declined to talk about the transaction, citing policies regarding not discussing financial strategies. Though it's unclear what Ford's initial investment was, the 220,000 shares would be valued at more than $100 million, based on a $495 per share price as of Nov. 16, 2006. The foundation was the largest limited partner (LP) of venture capital firm Sequoia Capital Sequoia Capital is a venture capital firm founded by Don Valentine in 1972. The firm's partners include Don Valentine, Pierre Lamond, Michael Moritz, Doug Leone, Mike Goguen, Mark Stevens, Jim Goetz, Sameer Gandhi, Roelof Botha, and Mark Kvamme. Partners, the Silicon Valley firm that also invested early in the likes of Yahoo!, Google and Apple. Ford's share was almost a quarter of Sequoia's total 941,027 shares received, which had a value of $465 million. It's not uncommon for foundations to go into business as limited partners with venture capital firms Name Location Founding date Managing Partners/Directors Specialty Capital managed 5AM Ventures Menlo Park, CA; Waltham, MA 2002 John Diekman, PhD (managing partner), Scott Rocklage, PhD (managing partner), Andrew Schwab (managing partner) life sciences $200M [1] . "They have investment advisors that are keeping them on the front lines of high-return investments, so I'm not surprised that they would find their way into venture capital investments," said Rick Cohen cohen or kohen (Hebrew: “priest”) Jewish priest descended from Zadok (a descendant of Aaron), priest at the First Temple of Jerusalem. The biblical priesthood was hereditary and male. , former executive director of the National Committee for Responsive Philanthropy. Google's February SEC filing listed numerous foundations, charitable trusts and universities that received stock from the YouTube sale, most valued in the millions of dollars. The Sherman Fairchild Foundation Sherman Mills Fairchild was the founder and chairman of many Fairchild Corporations. Howard Hughes was a close friend who stayed at Fairchild's Lond Island Estate when he came to New York. Mr. in Chevy Chase, Md., ended tip with shares valued at almost 312 million, the Rockefeller Foundation more than 39 million, and the J. Paul Getty Trust The J. Paul Getty Trust is the world's wealthiest art institution with an estimated endowment of $5.8 billion. Based in Los Angeles, it operates two museums: the J. Paul Getty Museum in Brentwood and the Getty Villa in Malibu, California. , 31.7 million. The Boston-based Barr Foundation yielded $7.1 million from its investment. Though it's unclear what the initial investment was for each investor, a look at the James Irvine Foundation's filing with the Internal Revenue Service provides a glimpse of the astronomical return. According to its 2003 Form 990-PF, the San Francisco-based foundation had a $275,000 stake in Se quoia Capital XI. Three years later, the Google purchase resulted in almost 15,000 shares for the foundation, valued at 37.2 million. Universities throughout the United States, as well as abroad, were rewarded for being early investors in the video-sharing Web site. Oxford University received more than 3,400 Google shares, a value of more than $1.6 million. American universities also were among the early investors, including Princeton, Massachusetts Institute of Technology Massachusetts Institute of Technology, at Cambridge; coeducational; chartered 1861, opened 1865 in Boston, moved 1916. It has long been recognized as an outstanding technological institute and its Sloan School of Management has notable programs in business, , Dartmouth, Columbia University Brown University and Northwestern, Minnesota, Rensselaer Polytechnic Institute Rensselaer Polytechnic Institute, at Troy, N.Y.; coeducational; founded and opened 1824 as Rensselaer School; chartered 1826. It was called Rensselaer Institute from 1837 to 1861. and the University of Southern California The U.S. News & World Report ranked USC 27th among all universities in the United States in its 2008 ranking of "America's Best Colleges", also designating it as one of the "most selective universities" for admitting 8,634 of the almost 34,000 who applied for freshman admission , in addition to smaller colleges such as Grinnell and Wesleyan. As part of its $200 million endowment, the San Francisco Symphony  This article or section needs copy editing for grammar, style, cohesion, tone and/or spelling.You can assist by [ editing it] now. has a diversified portfolio of investments, said Gary Ginstling, director of communications Director of Communications is a position in the private and public sectors. The Director of Communications is responsible for managing and directing an organization's internal and external communications. and external affairs. The nonprofit has an endowment policy and an investment committee appointed by the board that is responsible for managing investments. The symphony was rewarded with more than 3800,000, based on the 1,700 shares of Google received. "A certain percent of our endowment is allocated for investments and those kinds of funds," Ginstling said, adding that it is probably a little more conservative than other nonprofits and endowments. He estimated about 22 percent is allocated to "alternative investments," a category that would include venture capital funds Venture Capital Funds An investment fund that manages money from investors seeking private equity stakes in small and medium-size enterprises with strong growth potential. Notes: . "Googling for dollars" Shares * Estimated valuess ** Sequoia Capital XI, LP 941,027 $465,808,365 The Ford Foundation 218,989 $108,399,555 The Church Pension Fund 40,515 $20,054,925 University of Notre Dame 39,848 $19,724,760 University of Southern California 30,901 $15,295,995 William and Flora Hewlett Foundation 28,923 $14,316,885 Sherman Fairchild Foundation 24,066 $11,912,670 Rockefeller Foundation 19,609 $9,706,455 Yale University 18,042 $8,930,790 Vanderbilt University 17,011 $8,420,445 James Irvine Foundation 14,721 $7,286,895 Barr Foundation 14,434 $7,144,830 Gordon and Betty Moore Foundation 14,434 $7,144,830 Trustees, Columbia University 14,434 $7,144,830 Massachusetts Institute of Technology 14,434 $7,144,830 Northwestern University 12,068 $5,973,660 Trustees, Princeton University 9,021 $4,465,395 J. Paul Getty Trust 3,608 $1,785,960 Trustees, Grinnell College 3,608 $1,785,960 Source: Securities and Exchange Commission, Feb. 7, 2007 filing * Shares of common stock owned as of Nov. 15, 2006 ** Based on Google share price of $495 on Nov. 16, 2006 |
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