1

Jewish Endowment & Foundation Investment Institute (JEFII)

Access to Success Retooling CJP’s Investment Operations: A Case Study in Increasing SAT (Size, Access and Talent)

Alan Leifer, President Leifer Family Fund

Founder of Boston’s Jewish Community Endowment Pool

Immediate Past Chair of JFNA’s Investment Institute

Alan@leifer.org

www.leifer.org

JFNA 2015 Investment Institute

February 2015

JEFII’s Vision

Our vision is for the world of Jewish philanthropy to define the standard of

excellence in the governance and management of long-term capital.

StrongGovernance

EffectiveInvestment

SuperiorReturns

Gain Shareof Jewish

Wallet

Increased JewishPhilanthropic

Resources

UltimateGoal

Increase SAT - The Virtuous Circle of Endowment & Foundation Management

4

Obstacle

s

JCEPCJP Old Status Quo(No SAT)• Donor engagement strategy• Too many conflicts• Lack of expertise• Low level of meeting time• Fee driven• Meddling versus monitoring

• Trusted fiduciary• Transparent operations• Superior access• Best in class due diligence• Client focussed• Talented leadership

Identify Barriers to Change and Develop Strategies to Overcome Them

5

Today, One Policy Portfolio – 150+ Users $3 Billion Under Management Y/E 2014

• Key Agencies’ Endowment PlansBeth Israel Deaconess Medical Center, CJP, +25 Agencies/Affiliates

• Boston Based Affiliated OrganizationsBroad Institute, Facing History and Ourselves + 25 Temples, 5 Schools

• Local Family Foundations and DAFsLeifer Family Fund, Private Foundation +65 Others

• National Jewish Federation Investment ProgramJAFI, Birmingham, Memphis, Indianapolis + 11 Others

• National Like-Minded StakeholdersPrivate Foundation, Out of Region Day Schools

• Defined Benefit Pension PlanCareGroup

6

A Strategic Review of CJP’s Investment Landscape

In 1998 We Had:• $50 million in a Hodgepodge of Assets

Endowment, Supporting Foundation, DAF, Scheduled Assets• Mediocre Performance• 23 Member Committee

1 Investment Volunteer, 0 Investment Pros, 22 Major Donors• 50 Jewish Institutions/Foundations With Sizable

Assets Under Management in Boston• Strong Relationship with Beth Israel Hospital

7

Develop Investment Philosophy

• Total Return Philosophyo Balance Interest and Dividends with Long-Term

Appreciation

• Use an Investment “View” to Avoid Asset Allocation Mistakes

• Willingness to be Contrarian and Spurn Fads• Use of Alternative Investments• Low Beta, High Alpha• Carefully Monitor and Manage Liquidity• Compound Returns by Reducing Risk

8

Rebrand and RelaunchJewish Community Endowment Pool, LLP (JCEP)

• Launched as a Pro Bono Effort of Boston’s Jewish Money Manager’s Campaign Team in 1998

• “Free” to Non-Profits, Low Cost to Family Foundations

• Cut and Rationalize Fees

• Word of Mouth Marketing – “A Coalition of the Willing”

• “Brand Name” Investment Committee

• Focus on One Pool

9

Rebuild the Team CJP/Caregroup Board of Managers

Current or Past Affiliations

• Daniel Jick, ChairHighVista Strategies

• Seth Klarman, Vice ChairBaupost Group

• Seth AlexanderMIT

• Stephen Berger

Adamas Partners

• Matthew BotteinBlackrock, Inc.

• Alicia CooneyMonument Group

• Lawrence LasserPutnam Investments

• Alan LeiferFidelity Investments

• R. Gregg StoneKestrel Venture Partners

Affiliations for identification purposes only.

10

Expand The NetworkCareGroup/JCEP Investors - $3 Billion

as of December 31, 2014Abraham Joshua Heschel SchoolAdams Street ShulAlef-Bet Child CareBeth Israel Deaconess OB/GYN FoundationBeth Israel Deaconess Radiological FoundationBeth Israel Senior Citizens Housing, Inc.Camp Ramah of New EnglandCamp YavnehCape Cod SynagogueCareGroup Investment PartnershipCareGroup Pension PlanChabad House of Harvard SquareCheder MenachemCJP Large Donor Advised Funds (64)CJP EndowmentCohen Hillel AcademyCongregation Beth El of the Sudbury River ValleyCongregation Beth Israel of MaldenCongregation Mishkan Tefila Facing History & OurselvesFalmouth Jewish CongregationFrances Jacobson Early Childhood CenterGann AcademyHarkham Hebrew AcademyHebrew CollegeHillel: The Foundation for Jewish Campus LifeJewish Agency for IsraelJewish Big Brother & Big Sister Association of Greater BostonJewish Big Brother & Big Sister Association of Greater Boston Endowment

TrustJewish Community Center of the North ShoreJewish Community Centers of Greater BostonJewish Community Housing for the ElderlyJewish Family & Children’s ServiceJewish Family Service of MetrowestJewish Federation of Greater Indianapolis, Inc.Jewish Federation of Greater Middlesex CountyJewish Federation of Greater Pittsburgh Jewish Federation of Las Vegas Jewish Federation of New HampshireJewish Federation of Omaha Foundation

Jewish Federation of Palm Springs and Desert AreaJewish Federation of ReadingJewish Foundation of MemphisJewish Vocational Services, Inc.Jewish Women's ArchivesMaimonides SchoolMayyim Hayyim Living Waters Community Mikveh Memphis Jewish FederationMIT HillelPrivate Family Foundations (2)Rashi SchoolSAR AcademySarasota-Manatee Jewish FederationSaval Charitable TrustSolomon Schechter Day SchoolSynagogue Council of MassachusettsTemple AliyahTemple Beth AvodahTemple Beth Avodah Endowment TrustTemple Beth Elohim Endowment Fund, Inc.Temple Beth ShalomTemple Beth SholomTemple B’nai AbrahamTemple Emanu-ElTemple Emanuel Endowment FundTemple Emanuel of AndoverTemple Emunah EndowmentTemple Isaiah of LexingtonTemple Israel (Boston)Temple Israel of NatickTemple Israel of SharonTemple ReyimTemple Shaare Tefilah (Norwood)Temple Shalom of NewtonTemple Shir TikvaTemple SinaiTidewater Jewish FoundationUJC of the Virginia Peninsula EndowmentUJF of Greater Stamford, New Canaan and DarienWoodstock Area Jewish Community – Congregation Shir Shalom

11

Be Transparent and Benchmark Against the Best

JCEP Performance vs. The Cambridge Assoc. Elite 400as of June 30, 2014

Percentile ranks are based on a scale of 0-100, where 0 is best and 100 is worst.

Source: Cambridge Associates, LLC. Three, five and ten year returns are annualized and net of investment management and

custodial fees.        

Average Annualized Return (%)

3 Years 5 Years 10 Years

JCEP 7.6 9.7 8.1

Median 8.5(n=419)

11.5(n=409)

7.3(n=368)

Percentile 75th 91st 26th

Sharpe Ratio 1.16 1.47 0.81

12

INDIRECT BENEFITS (Gain Share of Jewish Wallet)CJP Leadership

Chair (Current and Elect) Overseas ChairCampaign Co-Chairs (2010,2012,2013, 2014, 2015)) Budget Chair (Current & Immediate Past)

Young Adult Co-ChairAnnual Campaign At Peak - $54 MillionMoney Managers Are Half Of $1 Million Annual DonorsMoney Managers’ Donations Rose From 2% To 41% Of Annual CampaignCJP Is Viewed As A Trusted Philanthropic Adviser To The Jewish Family Foundation Sector

UN

UN

Measure Outcomes

DIRECT BENEFITS (Increased SAT)$300 Million Family Donor/Foundation 2014 Inflows$3 Million in DAF & Endowment Fund Fees Subsidizes Operations & Allocations$5 Million Budget for Full Investment Office17 Dedicated FTEs.120 BPS Value Added Annually over 10 Years.

13

RECAP: Steps to Increasing SAT

• A Strategic Review• Develop Investment Philosophy• Rebrand and Relaunch• Rebuild the Team• Expand the Network• Be Transparent • Benchmark Against the Best• Measure Outcomes

14

StrongGovernance

EffectiveInvestment

SuperiorReturns

Gain Shareof Jewish

Wallet

Increased JewishPhilanthropic

Resources

UltimateGoal

The Virtuous Circle of Endowment Management