Harvard Management, which oversees the $29 billion endowment fund at Harvard University, Cambridge, Mass., will shed roughly 25% of its staff over the next few months, spokesman John Longbrake confirmed today.
Industry sources, who declined to be named, said layoffs at HMC began this week, with investment professionals among those leaving.
According to a statement from Harvard Management, targeted reductions will occur throughout the Harvard Management Company and will include some investment professionals, as well as back-office and other support personnel operations, IT, human resources and legal.
The announcement comes two months after Drew Faust, Harvard Universitys president, revealed that the value of Harvards endowment the biggest in the nation plunged at least 22% to about $29 billion in the first four months of the current fiscal year that began July 1. The fund had $36.9 billion at the close of the previous fiscal year.
Harvard Management has more than 200 people in its downtown Boston office, according to the money managers website.
The statement said Harvard Management s new management team, headed by Jane Mendillo, has launched a series of steps to rebalance and re-engineer the organization.
People familiar with the company, who declined to be named, said Ms. Mendillo called staff to the companys trading floor Thursday morning and announced the pending changes and layoffs. They said more than 50 employees were either laid off immediately or told that their jobs would be eliminated by the end of March.
Ms. Mendillo didnt return calls seeking comment.
The sources said this weeks layoffs shouldnt be seen as a sign that Harvard Management is considering reducing the amount of money it manages in-house for Harvard. More than half of the endowments assets are managed by outside firms.
The changes are the latest in a period of dramatic flux for HMC in recent years, following a long stretch of stability and investment success under Jack Meyer, who led the company for more than 15 years through 2005, when he and Harvard Managements star fixed-income managers left to form hedge fund firm Convexity Capital Management.
In 2006, Harvard Management brought in Mohamed El-Erian from PIMCO; less than two years later, Mr. El-Erian returned to PIMCO, where he is now CEO and co-CIO.
Ms. Mendillo was recruited from Wellesley College, Wellesley, Mass., where she was CIO for its $1 billion endowment fund.