3/15/00

James Robinson, News Service (650) 723-5675;
e-mail: jamesrob@stanford.edu

McCaffery named president and CEO of Stanford Management Company

Mike McCaffery, the chairman of the board of the investment banking firm of Robertson Stephens, has been selected as the new president and chief executive officer of Stanford Management Company (SMC), President Gerhard Casper announced Wednesday.

McCaffery, who earned an M.B.A. from Stanford Business School in 1982, will assume his new duties in September. He will replace Laurance R. (Laurie) Hoagland, who announced in October 1999 that he was stepping down after guiding the management company to remarkable success since its founding in 1991. Hoagland will become treasurer of the Hewlett Foundation.

McCaffery, 46, has more than 20 years of investment banking experience. He joined Robertson Stephens in 1988 and before that was at Morgan Stanley & Company.

"I am very pleased that Mike McCaffery has accepted our offer to become the second CEO of Stanford Management Company, succeeding Laurie Hoagland, who has most ably led SMC ever since its founding nine years ago," President Gerhard Casper said. "Mike McCaffery brings to his new task his prior outstanding management and investment experience as well as familiarity with Stanford. I have the utmost confidence in Mike's ability to build the endowment and thus help to maintain and strengthen the university in the years to come."

Investment manager John Scully, a member of SMC's board who chaired the search committee that recommended McCaffery's appointment, said McCaffery has an outstanding record of success at several major investment banks, culminating in his position at Robertson Stephens.

"We contacted dozens of candidates and potential candidates, and from our earliest meetings Mike's name was prominent on our list. We're very excited Mike has decided to accept this position. He was clearly our first choice," Scully said.

Scully said McCaffery "inherits an organization that has been producing exceptional results for the university under the leadership of Laurie Hoagland. The search committee has great confidence in Mike's ability to sustain that momentum and take full advantage of the new investment opportunities that will undoubtedly evolve in the coming years."

Before earning his M.B.A. at Stanford, McCaffery received his undergraduate degree from Princeton. He also holds a B.A. Honours and an M.A. as a Rhodes Scholar from Merton College at Oxford University.

"I hope to be able to continue and improve upon the great organization and track record that Laurie's built and in that way contribute to the future success of Stanford," McCaffery said.

"This opportunity will permit me to use the 22 years of experience that I have in the investment banking business, but will also be a new challenge. And I really like the idea of doing something new and different at this point in my career and particularly like the idea of doing it at Stanford and being part of the Stanford community.

"I absolutely loved my time at Stanford and feel that the education I got and the people I met there were critical to my investment banking career."

As of Aug. 31, 1999, the assets for which SMC is responsible totaled $7.9 billion. Since SMC's founding, the Merged Endowment Pool, which includes most of Stanford's endowment, has grown from $1.87 billion to approximately $7 billion currently. In addition, during the past eight and one-half years approximately $1.4 billion in total has flowed from the endowment into the university budget.

Growth has been driven by strong investment markets, outstanding performance by internal and external managers and substantial new gifts. Under Hoagland, the endowment has grown at a 17.9 percent annual return, significantly exceeding the composite benchmark. The incremental dollars earned on the endowment over the benchmark return during Hoagland's tenure total $600 million.

McCaffery noted that at Robertson Stephens "we have as clients virtually all of the investors who manage money for the Stanford Management Company, such as the venture capitalists whom we, as investment bankers, are in constant dialogue with about financing companies in their portfolio."

Since 1988, Robertson Stephens has grown from 125 employees with $38 million in revenues to more than 1,100 employees worldwide and $1 billion in revenues. In 1999, the firm completed 218 public offerings and 66 private offerings, raising more than $40 billion in capital for clients.

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By James Robinson