The Gayner Fund is a new organization on Grounds that has begun to get students across all majors interested in long-term investing through managing an investment portfolio. The organization, which began operations in spring 2023, aims to allow any students of any background, regardless of their financial expertise, to get hands-on experience and engage with executives in the finance industry.
Through immersing students into long-term investing in valuable firms, the members hold the ambitious goal of making the cost of attendance at the University free for all students. The fund plans to begin offering scholarships to certain students 25 years from now, and, as the investments compound, expand these scholarships until they can cover the tuition of all students attending the University.
The Gayner Fund was started by Jacob Slagle, fourth-year College student and current President, and Class of 2023 alumnus Joe Beck in collaboration with Class of 1983 alumni Susan and Tom Gayner, who funded the project.
The Gayner Family has pledged $25,000 per year for the next 25 years to the organization, which is to be invested each year. So far, the organization has raised $100,000 through the contribution of other donors as well, and expects to raise an additional $600,000 over the course of 25 years. In addition, every student who joins the club pays $25 in dues which go towards the investment portfolio as well.
Half of the money received from the club’s investment will be reinvested, while the other half will be used to provide scholarships to future University students. For example, students who made the investing decisions in the first year of the organization will be responsible for determining which students are given scholarships in year 26, and so on.
The only rule enforced by the fund in regards to its investing decisions is that all investments must be held for 25 years. The fund does not require companies to fit certain sustainability or social responsibility metrics. However, according to Slagle, companies that club members are interested in investing in often are socially responsible companies.
“Tom likes to say that you're not going to have a company [that] lasts for very long that isn't being governed responsibly,” Slagle said.
The members chose the stocks they wanted to invest in through a stock pitch competition held in the spring. Last spring, students created and presented stock pitches to Tom Gayner and his colleagues at the Markel Group, who then asked the students further questions and gave feedback on their pitches.
After this, the club voted on which stocks to introduce into the portfolio — the Gayner family itself does not have any direct control over which stocks are in the portfolio.
Jonathan Scanlon, fourth-year College student and senior strategic advisor for the fund, said that Tom Gayner believes that value investing is an important way for students to understand the importance of patience in yielding high investment returns. He also said that he thinks that the club’s democratic-oriented decision-making process is what makes the club unique and valuable.
“People basically come together and we decide how all of that money is going to be used and invested,” Scanlon said. “We can decide. So it's different as we hold it for that entire period. We can't change it — and we're making all those decisions.”
Jonathan Rivers, fourth-year College student and Vice President of the Gayner Fund helps run the club. According to Rivers, the organization is oriented around encouraging young investors to focus their investing habits to the long-term, as each investment the club makes has to be held for 25 years before it is liquidated.
A key difference between the long-term mindset of the Gayner Fund and the greatest total return mindset of other clubs is because the Gayner Fund has to ensure that the investing decisions that are made will be successful beyond individual students’ four years at the University.
“I think one of the main reasons that Mr. Gayner wants us to invest in this way is that there’s a propensity for young people, when they make a successful investment, to not really see it out,” Scanlon said. “Once it goes up, they try to sell. And I think the goal of this fund is to let it run and see what happens.”
The Gayner Fund openly publishes their investing decisions for the student community in an annual report. The four stocks chosen for the portfolio in the 2022-23 academic year were Apple, Restoration Hardware, the Markel Group and ASML.
There is a training process for all members, which includes lectures on different financial topics and helps students of all academic backgrounds understand investing before they pitch stocks to add to the fund. Exposure to “long game” investment strategies is also helpful for members who might want to apply them to personal investments in the future. Rivers said that, with the help of the Gayner family, they invite key leaders in the finance industry to enhance students’ understanding of investing.
“What we do is not only just investing, but through Tom’s connections, we bring in Tom’s friends, investors, CEOs and people who’ve managed billions of dollars to give lectures to our club, at least once a month,” Rivers said.
According to Slagle, these lectures — which help students understand how to present a stock pitch, value companies, create discounted cash flow models and evaluate company management — have allowed students from backgrounds ranging from kinesiology to engineering to participate in The Gayner Fund.
“I think U.Va. students should know about it because everyone is welcome,” Slagle said. “We don't have applications or anything — we can overcome that kind of policy where you can attend our events for a small fee and it's very open and [we] are welcoming of everyone to attend regardless of major or career paths.”
Slagle hopes that through attracting the brightest minds at the University, the club can get closer to its mission of raising enough money to create scholarships for future students.
“I think we’re really offering a service allowing people to get that same fundamental education, even if they’re not coming in with the same background or knowledge that a lot of people do. I think we provide a lot of value in terms of the diversity and equity perspective,” Scanlon said.
Looking forward, both the Gayner family and the members hope that the organization will continue empowering students, Scanlon said. “Just knowing that my involvement in this club directly relates to future [students] paying less money for college in a world where college is expensive, is super meaningful.”
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