Make your money work for you.

This age-old advice is repeated over and over again in the world of finance; a simple, yet powerful concept that encourages taking control of your finances and growing wealth over time through astute, strategic investments.

On the day-to-day, most people are likely consumed with thoughts about their own personal savings, perhaps tracking the stock market or meeting with a financial advisor. But what about the long term finances of large public entities, with perhaps more complicated financial nuances and restrictions to consider? The long term finances of Virginia Commonwealth University, for instance?

This is where VCU Investment Management Company (VCIMCO) comes into play.

VCIMCO was created to manage the long term assets of VCU, including endowed funds from the VCU Foundation.

Having grown substantially since its founding, and with CEO Bruce MacDonald taking charge in 2024, VCIMCO is moving into 2025 with excitement and focus on its mission: the organization is committed to generating strong investment returns, supporting academic initiatives at VCU, and ensuring the long-term financial sustainability of the university.

THE LAUNCH

All things considered, VCIMCO is still in its infancy; the 501c3 non profit organization was first created less than ten years ago in 2015.

A brainchild of VCU President Michael Rao, VCIMCO was created solely for the purpose of managing the long term assets of the university and its affiliates. Rao saw how peer institutions like the University of Virginia and University of North Carolina had built captive investment management organizations for their funds and was eager to establish the same mold for VCU. When it came to selecting leadership, he turned to Nancy Everett, who at the time was on the VCU Board of Visitors. In 2015, she rolled off the board and became the first CEO of VCIMCO.

“Nancy was an amazing talent to tap,” says MacDonald, who worked alongside Everett as CIO before becoming CEO when Everett retired in June 2024. “Her background as a VCU graduate and former CIO of both the Virginia Retirement System and the General Motors Pension made her an ideal candidate to launch this endeavor. She had a bold vision to better engage donors and ultimately increase the university’s resources.”

As the first CEO, Everett assembled a team and Board of Directors entirely from scratch. While the majority of board positions are independent, two appointees are from the VCU Board of Visitors, two appointees are from the VCU Health System and one appointee is named by the VCU President. These five board positions represent the founding partners of VCIMCO—and the $700 million dollars initially brought into the portfolio.

VCU Foundation joined the pool in 2016.

“One of Nancy’s superpowers is that she has the ability to find amazing talent, then she trusts them to do their job,” says MacDonald. “She believes in the power of building strong teams. She groomed me to step into her role, and I am grateful for the time I’ve had to learn from her.”

THE STRATEGY

The overarching goal of VCIMCO is to manage the long term assets of the university and its affiliates. For the VCU Foundation in particular, the primary focus is to manage the endowed Foundation assets with a goal of generating great long term returns; they aim to balance the needs of current beneficiaries alongside the needs of those in the future.

“We try to take enough risks to earn returns so that money will still be there in the future for future generations to have even more resources,” says MacDonald. “But we don’t take so much risk that we won’t be able to spend today.”

So, how exactly do they do this?

Through strategic partnerships, management and communication about the overarching VCU mission. VCIMCO doesn’t have a team buying and selling stocks; instead, their model is to collaborate with the very best third party money managers to ensure their funds are invested in the best ways possible.

“Of course, most of these people are known to be the best in the industry, so their time is limited and it can be difficult to convince them that they should be working with us,” says MacDonald. “But the story of VCU and VCU’s mission is just so compelling: Access to excellence. The fact that it’s a majority minority undergraduate student body. Approximately 70% of students are balancing school with some kind of job. Almost a third or more are first generation. That really resonates, and we’ve created many wonderful partnerships because of it.”

VCIMCO also doesn't necessarily adhere to traditional investment models. Instead, they take a more deliberate approach to allocating assets, prioritizing thoughtful decision making and judicious spending of time and resources.

“For example, when we started, it was common practice to have 5-10% of your assets in China,” says MacDonald. “But the landscape was already starting to change there, and we thought very carefully about whether or not to invest in China, ultimately choosing not to. We instead focused our Asian exposure on India and Vietnam as a result.These two stock markets have thrived over the last five years as their economies have benefited from supply chain diversification away from China.”

THE TEAM

The VCIMCO staff is made up of a team of eight full-time employees. There are four individuals on the investment team: Managing Director Philip Keefe,, Director Marilyn Kelley Perkins, Vice President Sarah Khouri, and Jeff Metts, an analyst. VCIMCO runs a generalist model, meaning members of the investment don’t specialize, but rather develop a breadth of knowledge across different strategies in the portfolio.

Both Sarah and Jeff started as interns with VCIMCO when they were undergraduates at VCU. MacDonald says the internship program, which has welcomed more than a dozen VCU students since it began in 2017, is something the organization is most proud of.

“Before we started, there wasn’t an active funnel to Wall Street for VCU students,” says MacDonald. “That somewhat changed after Covid with remote recruiting, but in 2015, it was a hard path to trot. The creation of VCIMCO in 2015 opened up a direct line between VCU and Wall Street for the first time.” Two of VCIMCO’s early interns went on to get jobs at the global investment firm Carlyle.

“It’s truly delightful to have these interns as part of our team,” says MacDonald. “They’re hardworking, dependable and really insightful individuals. Together, we are able to present to the financial community a level of sophistication that makes us a desired partner.”

As MacDonald steps into the lead role at VCIMCO, he is looking to keep raising the profile of his team and the work they’re doing, all while enhancing the brand equity of VCU. He aims to create a virtual flywheel of success, where each area builds on each other.

“If we generate good returns, we will create more engaged donors, which will attract more assets, which will give us more resources to generate more returns, and it just keeps going on and on,” says MacDonald. “That was the vision in the early 2010s, and that’s what we’re continuing to do. VCU has really admirable ambitions, but they all take financial resources, and we see ourselves helping with that, generating returns and helping to generate gifts.”

Laura Kottkamp, Executive Director of the VCU Foundation, School of Business Foundation and College of Engineering Foundation, says that VCIMCO is both instructive for and receptive to feedback from trustees on the foundation boards.

“Most of the trustees on our finance committees have 20 years of expertise in asset management, private equity or investment banking. Bruce and his team eagerly listen and share current thinking and best practices in terms of what model inputs they use or why they select a certain geography.

Both the trustees and our own internal operations team are so appreciative of how willing the team is to run a scenario for us or answer questions. We are a client, but it’s most definitely a partnership.”

THE FUTURE

Looking at the numbers, it’s easy to see the success of VCIMCO and the impact the organization has had at VCU.

Since its inception through June 30, 2024, VCIMCO has grown its assets under management from an initial $700 million to more than $2 billion. It has generated an annualized five-year return of 9.2 percent, outperforming its policy benchmark by 1.8 percent. VCIMCO has also achieved top decile returns among university endowments greater than $1 billion for two consecutive years.

VCIMCO's success is also reflected in the impact it has on VCU and its affiliates. Its strong investment performance has enabled the university to enhance academic programs, research initiatives, student support, community engagement, healthcare services, and faculty development.

There are a variety of challenges on the mind of MacDonald as he charts the course ahead, such as private markets and the role of private assets in the endowment model. But given the success of their model thus far, and by keeping his sights set on the success of VCIMCO partners, MacDonald is confident that the organization will continue to thrive and deliver value for years to come.

"I believe we can measure our success in two ways: by the success of our partners and by our ability to attract and retain top talent, both within VCIMCO and among our external managers. If we excel in both areas, we're on the right track."

Learn more about VCIMCO on the organization website.