I sent the following to the President, provost and AD this morning.
Marc, Persis and Bernard,
I was very disappointed this week to learn of Stanford’s decision to eliminate 11 varsity sports due to budget constraints. I hope you will reconsider this decision as these sports have contributed to the rich mosaic of excellence at Stanford University and that the organization has sufficient resources to avoid this decision.
The Stanford undergraduate experience is fundamentally about excellence. Each freshman arrives on campus with at least one world class talent. Stanford is almost always able to develop that talent but is rarely the only good choice. For example, my talent was mathematics and I received an excellent engineering education, but I could have learned as much about engineering at MIT. Bryce Love has great skill at football, but he could have probably better focused that talent at Alabama. Likewise, a performing artist could easily develop their skill at Juilliard.
Stanford is one of the very few places where all of those talents can be developed together. Every day at Stanford I was both inspired and humbled by the accomplishments of my fellow students in a way that would not have been possible for me at MIT. The diversity of types of excellence at Stanford is critical to the educational experience and cutting 11 sports will only reduce that diversity.
These 11 sports also offer opportunities for students to broaden their education. In addition to fully developing a student’s core talents, the Stanford experience encourages the student to take a chance on something outside of their comfort zone. Personally, I was book smart enough to get admitted but my athletic talent was limited. I would have loved to play football but I had the size of a safety and the foot speed of a lineman. My main skills were height and stubbornness. I was perfect for crew.
Crew was a physical challenge that helped me grow, improved my discipline and gave me several lifelong friendships. Unlike football or basketball, most of the crew roster walked on to the team and was admitted only for their academic achievement. The same can be said for many of the other 10 sports on your chopping block. These are 11 opportunities for students to broaden their education.
Over the years, I have had the opportunity to make numerous hires from elite universities. Playing a varsity sport demonstrates a strong work ethic and time management skills. I usually put those resumes on the top of the stack.
Your letter compares the sports we offer and participation rates to other power 5 schools. I feel this comparison is disingenuous, at best. We do not compete for students or model our undergraduate experience after Nebraska, Michigan or Alabama. The correct comparison is Harvard which offers 40 varsity teams without meaningful revenue from television or ticket sales. If they can do it, we can do it.
I firmly believe that Stanford has the financial resources to support these 11 teams and would propose 3 methods to close the normalized $12mm budget gap cited in your letter.
First, look to increase revenue. Several years back, the decision was made to remove advertising from the stadium and Maples. If we are flush, I am happy with that decision, but I would rather look at a few Pepsi signs than see Stanford cancel sports. Also, are we maximizing revenue from Pac-12 network and apparel deals?
Second, my understanding is that there is a fairly large athletics endowment but that the endowment only pays about 2% of assets towards the operating budget. (Please correct me if I am wrong.) Standard payout ratios for endowments are closer to 5%.
Stanford and the other elite schools have repeatedly stated that most of their large endowments are contractually committed for specific purposes. This does not seem like a credible position.
Most people in business recognize that expenses and budgets can easily be recharacterized to fit specific needs as long as the money is there. The men’s crew coach is an endowed position and I expect the same can be said for some of the scholarships for these 11 sports. Will Stanford be returning 100% of these funds to the original donors? If not, you have found a path to flexibility when it is convenient.
Finally, the University as a whole should provide support for the athletic department. Bryce Love, Katie Ledecky, Andrew Luck and Toby Gerhart all generated tremendous positive media coverage for Stanford. Recent Rose Bowls increased alumni connection. The athletic department has helped increase donations and applications to the general university. It is time to return the favor.
Stanford’s alumni base is small and geographically diverse compared to Texas and Ohio State. Our athletic department will never have the revenue of these schools. On the other hand, our GSB and engineering graduates are probably able to be far more generous in support of their school. I suspect that donations from these alumni are somehow used to support the History, Philosophy and Gender Studies departments. Why don’t they also subsidize athletics?
Stanford has an endowment of approximately $30bn. Additionally, the school owns very valuable income producing real estate including Stanford Shopping Center, Sand Hill Road and the Stanford Research Park. Despite these riches, many alumni and other wealthy people continue to give generously to increase their association with the school. These donations can be expected to continue.
I fully recognize that covid will negatively impact revenues for some finite period of time and applaud the university for looking to do some belt tightening. I believe each of you have generously agreed to forego part of your expected salary this year. Thank you. That being said, I think this is the time to tap reserves or consider short term borrowing in order to maintain all of the opportunities for excellence at Stanford.
I cherish my experience at Stanford and consider receiving the fat envelope as a key life event. I have not donated in a while only because I do not see the school as particularly needy and there are many other institutions that would benefit from limited my charitable dollars. I think many alumni feel the same way. If my above analysis is somehow misguided, I invite you to correct me and I would be happy to begin donating again.
Marc, Persis and Bernard,
I was very disappointed this week to learn of Stanford’s decision to eliminate 11 varsity sports due to budget constraints. I hope you will reconsider this decision as these sports have contributed to the rich mosaic of excellence at Stanford University and that the organization has sufficient resources to avoid this decision.
The Stanford undergraduate experience is fundamentally about excellence. Each freshman arrives on campus with at least one world class talent. Stanford is almost always able to develop that talent but is rarely the only good choice. For example, my talent was mathematics and I received an excellent engineering education, but I could have learned as much about engineering at MIT. Bryce Love has great skill at football, but he could have probably better focused that talent at Alabama. Likewise, a performing artist could easily develop their skill at Juilliard.
Stanford is one of the very few places where all of those talents can be developed together. Every day at Stanford I was both inspired and humbled by the accomplishments of my fellow students in a way that would not have been possible for me at MIT. The diversity of types of excellence at Stanford is critical to the educational experience and cutting 11 sports will only reduce that diversity.
These 11 sports also offer opportunities for students to broaden their education. In addition to fully developing a student’s core talents, the Stanford experience encourages the student to take a chance on something outside of their comfort zone. Personally, I was book smart enough to get admitted but my athletic talent was limited. I would have loved to play football but I had the size of a safety and the foot speed of a lineman. My main skills were height and stubbornness. I was perfect for crew.
Crew was a physical challenge that helped me grow, improved my discipline and gave me several lifelong friendships. Unlike football or basketball, most of the crew roster walked on to the team and was admitted only for their academic achievement. The same can be said for many of the other 10 sports on your chopping block. These are 11 opportunities for students to broaden their education.
Over the years, I have had the opportunity to make numerous hires from elite universities. Playing a varsity sport demonstrates a strong work ethic and time management skills. I usually put those resumes on the top of the stack.
Your letter compares the sports we offer and participation rates to other power 5 schools. I feel this comparison is disingenuous, at best. We do not compete for students or model our undergraduate experience after Nebraska, Michigan or Alabama. The correct comparison is Harvard which offers 40 varsity teams without meaningful revenue from television or ticket sales. If they can do it, we can do it.
I firmly believe that Stanford has the financial resources to support these 11 teams and would propose 3 methods to close the normalized $12mm budget gap cited in your letter.
First, look to increase revenue. Several years back, the decision was made to remove advertising from the stadium and Maples. If we are flush, I am happy with that decision, but I would rather look at a few Pepsi signs than see Stanford cancel sports. Also, are we maximizing revenue from Pac-12 network and apparel deals?
Second, my understanding is that there is a fairly large athletics endowment but that the endowment only pays about 2% of assets towards the operating budget. (Please correct me if I am wrong.) Standard payout ratios for endowments are closer to 5%.
Stanford and the other elite schools have repeatedly stated that most of their large endowments are contractually committed for specific purposes. This does not seem like a credible position.
Most people in business recognize that expenses and budgets can easily be recharacterized to fit specific needs as long as the money is there. The men’s crew coach is an endowed position and I expect the same can be said for some of the scholarships for these 11 sports. Will Stanford be returning 100% of these funds to the original donors? If not, you have found a path to flexibility when it is convenient.
Finally, the University as a whole should provide support for the athletic department. Bryce Love, Katie Ledecky, Andrew Luck and Toby Gerhart all generated tremendous positive media coverage for Stanford. Recent Rose Bowls increased alumni connection. The athletic department has helped increase donations and applications to the general university. It is time to return the favor.
Stanford’s alumni base is small and geographically diverse compared to Texas and Ohio State. Our athletic department will never have the revenue of these schools. On the other hand, our GSB and engineering graduates are probably able to be far more generous in support of their school. I suspect that donations from these alumni are somehow used to support the History, Philosophy and Gender Studies departments. Why don’t they also subsidize athletics?
Stanford has an endowment of approximately $30bn. Additionally, the school owns very valuable income producing real estate including Stanford Shopping Center, Sand Hill Road and the Stanford Research Park. Despite these riches, many alumni and other wealthy people continue to give generously to increase their association with the school. These donations can be expected to continue.
I fully recognize that covid will negatively impact revenues for some finite period of time and applaud the university for looking to do some belt tightening. I believe each of you have generously agreed to forego part of your expected salary this year. Thank you. That being said, I think this is the time to tap reserves or consider short term borrowing in order to maintain all of the opportunities for excellence at Stanford.
I cherish my experience at Stanford and consider receiving the fat envelope as a key life event. I have not donated in a while only because I do not see the school as particularly needy and there are many other institutions that would benefit from limited my charitable dollars. I think many alumni feel the same way. If my above analysis is somehow misguided, I invite you to correct me and I would be happy to begin donating again.
