ALO36: The Endowment Playbook for Long-Term Investing ft. Paul Chai

Managing a $1.2 billion endowment requires treating the portfolio as a "forever retiree" that balances dependable income, inflation protection, and long-term capital growth. Paul Chai, CIO of the Kansas State University Foundation, employs a disciplined Strategic Asset Allocation framework to navigate market volatility while maintaining a 6% real return target. By operating between traditional asset allocation and a total portfolio approach, the team identifies idiosyncratic, less-trafficked opportunities that offer differentiated return streams. Manager selection prioritizes "grit"—defined as the combination of passion and perseverance—over pedigree, specifically seeking partners with harmonious passion rather than obsessive, self-serving motivations. Effective governance involves translating complex technical data into clear, actionable insights for board members, ensuring that the decision-making system remains resilient and aligned with the foundation’s philanthropic mission across generations.