University endowments that made early venture investments in Elon Musk’s SpaceX are seeing their bets pay off in the form of double-digit annual returns. But some allocators note that Musk’s rocket company was not the only path to outsized performance.
The $3.5 billion University of Colorado Foundation returned a net 20.34 percent for its latest fiscal year thanks in part to its initial investment of $150,000 in SpaceX in 2009 (with commitments totaling $4.2 million over time) returning nearly 57 times its original value. Meanwhile, Bloomberg reported that the $15 billion University of North Carolina System’s fiscal year return exceeded 30 percent. UNC invested in SpaceX more than 15 years ago through Peter Thiel’s Founders Fund — the holding is now roughly 10 percent of the endowment’s portfolio.
As the Financial Times reported, Harvard’s endowment held about $2.2 billion worth of SpaceX shares as of June 30, its largest ever single public equity holding, which has generated a significant investment gain. While Harvard has yet to publish its annual returns, other universities that invested early with SpaceX and semiconductor stock Cerebras Systems — including Harvard, Stanford, and Washington University — are expected to report massive wins.
New research from Markov Processes International (MPI) suggests a clear dichotomy between endowments with meaningful SpaceX exposure and those with essentially none, which may partly explain the dispersion on returns among foundations and endowments this year. For an institution that entered FY26 with several percentage points of SpaceX exposure, the roughly 280 percent appreciation could add between 8 and 11 percentage points to the year’s return.
Mark Baumgartner, CEO and CIO of the University of Florida Investment Corp., saw the latest results as a case study in the benefits of early-stage venture capital. As he explained, about a decade ago, early-stage was a game of small, oversubscribed, sector-focused funds, rather than the giant, open, and sector-diversified capital pools that it is today.
“Back then, only a few universities had access to managers investing in the early rounds of SpaceX, and only a few managers could offer concentrated exposure,” Baumgartner said. “Plus, the technology and regulatory risks at that time were immense.”
But while early investments in SpaceX drove strong performance at Colorado and North Carolina, other schools also posted double-digit returns without any exposure. Institutions with large U.S. and global passive equity allocations did quite well, as those indices were up between 22 percent and 23 percent. For the University of Nebraska Foundation, which had no direct exposure to SpaceX, its 12-month return for the period ending May 31 was nearly 23 percent.
“Thus far I have not heard of any endowment that didn't have SpaceX exposure beating our returns,” said Brian Neale, CIO for the $3.9 billion foundation. “We'll see when everyone fully releases.”
In addition, Baylor University, which was not invested in passive equities, SpaceX, or Cerebras, returned 19 percent for the 12 months ended May 31. David Morehead, chief investment officer for Baylor, told II that the $2.56 billion endowment’s performance was driven by its fund-of-one allocations in long-only energy, fixed income derivatives, ABS, distressed and global macro, all of which were up between 15 percent and 60 percent for the 12 months ended June 30.
While June 30 returns are not yet available, the award-winning allocator estimates an annual return exceeding 18 percent. “Performance was not focused on one or two factors,” Morehead added.
The question that allocators and industry observers are currently asking is: Now What?
“SpaceX can have an extraordinary impact on one year’s return without necessarily telling us very much about the right long-term asset allocation,” said Michael Markov, MPI’s founder and CEO. “So, I would be very cautious about concluding that endowments posting around 20 percent this year should therefore increase their VC allocations.”
Baumgartner, who oversees the state university’s $7 billion endowment, noted that endowments with large, but still illiquid, SPCX shares on their books “are a bit like the dog who caught the car.” Since many institutions have policy risk guidelines that limit large single-stock positions, the endowments that benefited from the outsized SpaceX exposure may face pressure to sell down highly concentrated positions once lockups expire.
In early June, Space Exploration Technologies, aka SpaceX, completed its initial public offering at $135 a share. After reaching an all-time high of $225.64 later that month, the stock is currently trading at around $150 a share as of Thursday morning.
