Harvard Plans $10 Billion Private Equity Stake Sale for Liquidity

Harvard University is in advanced discussions to sell approximately $10 billion in private equity fund stakes. This process, which began last year, is unrelated to any threats of funding cuts by the Trump administration. The sale is part of a broader strategy to manage the endowment's liquidity and risk exposure, as the university seeks to balance its long-term investment goals with immediate financial needs.

The university's endowment fund, managed by Harvard Management Company, has accepted advice from a financial group to sell its investment portfolio to a private equity company. The terms of this potential secondary market transaction are not yet finalized and may change. This move comes as investors seek new ways to generate liquidity, especially in the face of market volatility caused by trade policies.

Despite the sale, this does not indicate a change in the asset allocation of Harvard University's $530 billion endowment fund. According to the university's annual financial report, 39% of its funds were invested in private equity assets in 2024, up from 34% in 2021. During that year, the university also sold nearly $10 billion in similar funds on the secondary market.

Harvard's decision to sell these stakes is seen as a proactive measure to ensure financial stability and flexibility in the face of potential economic uncertainties. The university faces increasing pressure to diversify its investment portfolio and reduce its reliance on private equity, which has been a significant contributor to its endowment's growth but also carries higher risk and lower liquidity. This sale is part of a broader strategy to manage the endowment's liquidity and risk exposure, as the university seeks to balance its long-term investment goals with immediate financial needs.