Mary McLean is the chief investment officer at the Ewing Marion Kauffman Foundation, where she oversees the Foundation's globally diversified $2.4 billion portfolio. McLean's affiliation with the Kauffman Foundation dates back to 1996. She was introduced to endowment investing in the mid-1990s as a senior associate with the Yale University Investments Office. Earlier in her career, she spent several years at Morgan Stanley.
In this interview, she discusses the Foundation's next steps in venture capital; why she’s eager to learn more about machine learning and the challenges associated with its application in the investment office; and her final thoughts as chief investment officer at the Kauffman Foundation.
Mary McLean was recently named as one of Trusted Insight's 2018 Top 30 Foundation Chief Investment Officers.
Trusted Insight: It's been over two years since your previous interview with us. Can you give us a recap of 2017-2018 for the Kauffman Foundation?
Mary McLean: The last couple years have been rewarding for our strategy, which emphasizes large allocations to public and private equity. We know the ride will get rough here at some point.
"Going forward, the Foundation will likely be more proactive in looking beyond these historical relationships, to engage in venture capital in new ways."
Trusted Insight: How does your academic background in mathematics inform your investment approach?
Mary McLean: I believe that studying math can improve a person’s intuition for decision making in the face of uncertainty. It helps counter natural biases that crop up when assessing the probabilistic profile of future outcomes, and when interpreting historical data. Ironically, my background in math makes me skeptical of some quantitative and systematic investment strategies.
Trusted Insight: What attracted you to investing through a foundation as opposed to any other institution type, and what’s kept you there?
Mary McLean: It has been a privilege to help support the Kauffman Foundation’s charitable efforts in education and entrepreneurship. My colleagues are doing great things that help connect people to the tools they need to shape their futures and be successful.
Trusted Insight: What is the Foundation’s next steps in venture capital?
Mary McLean: The Kauffman Foundation has been investing in venture capital for more than 20 years. Over the last decade, we have relied on a core set of long-standing general partner relationships. Going forward, the Foundation will likely be more proactive in looking beyond these historical relationships, to engage in venture capital in new ways. We’re in the process of figuring out next steps.
"My colleague Lisa Murray will take over as the chief investment officer in September. Lisa has been a crucial contributor since joining the Foundation in 2013."
Outside of the traditional investment function, our Entrepreneurship team is researching strategies for helping entrepreneurs overcome barriers to capital access. The goal is to level the playing field and open up opportunities across all our communities. These efforts extend beyond traditional venture capital to more widely applicable and arguably more important sources of entrepreneurial capital.
Trusted Insight: What are your thoughts on machine learning in the investment office? To what extent do you think it'll impact the asset allocator side of investing?
Mary McLean: I have a lot to learn about machine learning and AI, and the potential impact on the asset allocator side of investing. I’m guessing there are some great algorithms out there, but I wonder what challenges may arise with respect to data and implementation. It will be interesting to see what kinds of applications become successful.
Trusted Insight: Your well-deserved retirement is coming up at the end of August. What key characteristics would your ideal replacement possess?
Mary McLean: My colleague Lisa Murray will take over as the chief investment officer in September. Lisa has been a crucial contributor since joining the Foundation in 2013. Previously, she was with Angeles Investment Advisors in Santa Monica. Lisa’s skills span the full range from analytical to qualitative and interpersonal. I am very optimistic about the future.
Trusted Insight: Have you thought about what you will do next?
Mary McLean: I plan to make myself useful to society in new ways. I’m not sure what that looks like yet.
Trusted Insight: Are there any final thoughts that you’d like to share?
Mary McLean: I’m grateful to have been part of the investment profession, and I’m very indebted to those I learned from and those who gave me a chance at some point along the way.
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View the full list of 2018 Top 30 Foundation Chief Investments Officers here.