TIAA-CREF on Tuesday launched Covariance Capital Management, expanding its outsourced CIO services to a broader range of endowments. TIAA-CREF is providing $1 billion in seed capital to the new venture.
Scott W. Wise, who until June 2010 was president of Rice Management Co., which oversees the investment program for Rice University's $4 billion endowment, is president and chief investment officer of Covariance Capital Management. He joined TIAA-CREF in July.
In a telephone interview, Mr. Wise said while the effort to launch Covariance Capital has been under way for months, a formal announcement could only come after “a critical mass of people and systems” was in place.
He said a “tremendous team” has been assembled, capable of providing a “customized approach” in helping clients define their investment goals and pursue an open architecture asset allocation plan with their risk-return tolerances and liquidity needs in mind.
The team announced Tuesday includes Michael J. Jawor, deputy CIO; he was CIO at Glenwood Capital Investments. Olivia Tomlin, a spokeswoman for Glenwood Capital's parent Man Investments, couldn't immediately be reached for comment on replacing Mr. Jawor.
Also on the team are Daniel E. Feder, senior investment manager, private equity and venture capital, who was managing director of private markets for Sequoia Capital Heritage Fund; Ansel C. Mullins, senior investment manager, public markets and hedge funds, who was managing director and partner at Wave Management; and Holly A. Hardy, senior investment manager, real assets, who was energy and real estate investment portfolio manager at the Rice endowment fund.
Mr. Wise said Covariance will serve endowments with $100 million or more in assets, expanding the range of TIAA-CREF's current offerings, with affiliate Kaspick & Co. serving the $50 million to $100 million segment. While most clients are likely to fall within the $100 million to $1 billion segment, Mr. Wise said his sense of the market is that interest for outsourced CIO services is growing among endowments with more than $1 billion as well.