The nation’s most prestigious universities are making a rare and risky move: selling significant portions of their endowments. Harvard and Yale, two institutions with combined endowments exceeding $90 billion, have announced plans to offload private equity stakes amid political pressures, liquidity strains, and a shifting financial landscape. These sales, the largest in decades, reveal vulnerabilities even in the most well-funded academic institutions—and could signal a broader reckoning for endowment-dependent schools
Harvard’s $1 billion private equity secondary sale, facilitated by Jefferies and Lexington Partners, underscores a desperate bid for cash. The university faces a dual crisis: federal funding freezes and an endowment structure overly reliant on illiquid assets. With 83% of its $53.2 billion endowment allocated to private equity and hedge funds—compared to just 14% in public equities—the school risks being trapped in a “liquidity crunch.”
The Trump administration’s decision to freeze $2.2 billion in research grants and label Harvard a “political entity” has exacerbated cash flow concerns. To bridge the gap, Harvard issued $1.2 billion in municipal bonds in early 2025. But the bigger move is its shift from long-term holdings to secondary sales.
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KEY FINDINGS:
1. Ivy League payments and entitlements cost taxpayers $41.59 billion over a six-year period (FY2010-FY2015). This is equivalent to $120,000 in government monies, subsidies, & special tax treatment per undergraduate student, or $6.93 billion per year.