Class News
Len Baker ’64 eulogizes David Swensen in memorial service
April 12, 2022
A memorial service celebrating the life and legacy of Yale’s longtime chief investment officer and our 1964 Honorary Classmate David Swensen was held in Woolsey Hall on Sunday, April 10.
Len Baker ’64, who worked closely with Swensen for many years, eulogized David as a man who “affirmed the basic humanity in all his friends and partners.” You can view Peter Salovey’s introduction and Len’s eulogy in the 11-minute video excerpt below. The text of Len’s eulogy is reproduced below the video.
If you wish to watch the entire service, lasting 2¼ hours, you can view it here.
Len Baker’s Eulogy
David was a good friend. He enriched my life. I have that in common with so many of you here today.
I saw David’s work from three angles: I was a 24-year member of Yale’s Investment Committee, a partner in a firm that manages some of Yale’s money, and an investor in some of the firms that David helped create.
I joined the Investment Committee in 1990. The Endowment Model was still in flux. It was fun to watch it take shape. Before each meeting Dave’s team produced a 400-page book, impeccable classics that we would read closely and eagerly. I’ve still got all 100 of them in my basement. There were numbers-heavy analyses of the portfolio and detailed, people-heavy memos on each of the several managers Yale was looking at. The memos were frank and honest; their people insights were deep. David welcomed disagreement. Sometimes our talk about the character or motives of a manager would lead David to rethink a proposal. Decisions grew evermore people-focused as the years passed.
David hosted an all-hands dinner the night before each meeting. Wine flowed, really good wine. David liked good wine. Investment staff sat mixed with committee members. The table arguments were lively and seldom about finance. David was a true old-school intellectual. He cared about ideas and loved to debate, sometimes loudly. A time or two, in a moment of rhetorical vigor, the F-word might escape his lips. This amused the staff.
The Yale Endowment model comes from economist Harry Markowitz’s work in the 1950s. He showed that a portfolio of widely diversified, equity-like assets would earn more with less risk than the old-style mix of stocks and bonds. This idea is standard now, but it was novel at the time. When David took charge in 1986, there was no way to create such a portfolio; there were no such investible assets. David and Dean pioneered Markowitz’s ideas by putting dozens of new types of firms in business. Yale sought out small firms led by craftsmen investors who thought like the owners, treated Yale as a partner, and aimed to earn a fair share of excess returns instead of living on fees.
This was a people exercise, not a finance exercise. I was a partner in one such firm, a small venture-capital firm called Sutter Hill Ventures. In 1991, we had lost our lead investor and needed fresh capital. We had an oddball structure and no clue about how to raise money. David and Dean came to see us. We explained our peculiar situation and we wondered whether Yale was the right partner. We talked for a couple of hours about how we selected and supported startups. We asked for their advice. A few days later, Yale signed up to be our anchor investor. Three other endowments soon followed, and we still have the same limited partners today.
Later I learned that my story was a common one. I know of at least a couple dozen firms with similar stories started by people among us here today. David put firms in business, kept them going at a critical time, or pushed them to up their ambitions. David crafted a trusted set of partners who have earned decades of outstanding returns and have kept a special bond with Yale.
David’s genius was finding people strong in intellect and character. He made them longtime partners and friends. He let them do what they do best and feel good about themselves and about supporting Yale’s mission. To me, a leader is someone who makes people around him feel more productive, more ambitious, more worthwhile. David had that knack. People in his orbit somehow wanted to be the best version of themselves. He managed to do this in a way that affirmed the basic humanity in all his friends and partners.