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Exclusive Q&A: Mauricia Geissler, CIO, Amherst College

by trusted insight posted 2years ago 6183 views

Mauricia Geissler is chief investment officer at Amherst College. Prior to this role, Mauricia was director of public market investments at Lucent Asset Management, and senior vice president of institutional product strategy and development at Putnam Investments. She has a B.A. in Finance and Investments from the University of Wisconsin-Madison's School of Business.

Mauricia was recently named on Trusted Insight’s list of Top 30 Women CIOs. She spoke with Trusted Insight on April 18 2016. The following interview has been edited and condensed for clarity.

Trusted Insight: You have a B.A. in finance and investments from the University of Wisconsin-Madison School of Business. How have your educational experiences shaped your career?

Mauricia Geissler: My B.A. in finance, investments, and banking was a fairly broad degree, which gave me a fair amount of flexibility in thinking about opportunities straight out of school. As a result, I ended up going to work for an investment consulting firm called SEI in Chicago, where I had the opportunity to get involved in doing manager research for pension funds, endowments, foundations, corporate plans, etc. That really hooked me into this business and kept me in the investment space.

Trusted Insight: Was there a particular point at which you knew that you wanted to work in endowments?

Endowments in particular tend to be the thought leaders in our business, and look for opportunities to be early and not just be the “followers”, so to speak.

Mauricia Geissler: Actually, yes. The second company I worked for was a firm called Putnam Investments. At Putnam, I was in a product manager, product development and competitive analysis type role. I travelled a lot with salespeople on behalf of the investment teams that I worked for, including the international equity group at Putnam. I was visiting a university endowment in Iowa with a Midwest sales guys. At one point during the meeting, the endowment’s CIO looked at me and said, "You know Mauricia, the strategy that Putnam employs is all well and good, but we hired core managers years ago, and we're really looking for something new, innovative and creative."

It struck a chord with me. Endowments in particular tend to be the thought leaders in our business, and look for opportunities to be early and not just be the “followers”, so to speak. I knew then that at some point in my career I wanted to end up is working for an endowment, because they tend to be the leaders and innovators in the investment space.

Trusted Insight: You've got quite a lot of a background in the public markets from your previous experience, but presumably your current role requires you to have some knowledge of the private side as well. How have you managed that transition from a public focussed role towards a more generalist role?

Mauricia Geissler: All my work up until joining Amherst College thirteen years ago was focused in the public markets. However, in my previous role at Lucent, I worked closely with colleagues who covered private equity, venture capital, and so forth. As the head of public markets, this included working directly with both our director of real estate and our director of private equity and venture capital in thinking about overall portfolio construction and strategy. I benefited a lot from hearing some of the challenges and issues that they had to deal with in their manager universe versus the issues in the public space

The other factor that made my transition to the role of chief investment officer easier was that Amherst College has a fairly robust venture capital and private equity portfolio with some very high-quality names. It allowed me to really get to know those managers, and think about what made each of them top-shelf managers in our portfolio. I was then able to then go out and look at new managers with that lens. So I wasn't starting with a blank sheet of paper on the private side here at Amherst College. There was already a nice robust portfolio. It's really been harvesting that portfolio and planting new seeds for future growth.

Trusted Insight: You mentioned that you've got quite a lot of venture capital managers. Can you tell me a bit more about your split between public and private markets?

Mauricia Geissler: The portfolio is probably about 35% private equity, venture capital, with another 15% in other non-marketable real asset type strategies, including real estate, natural resources which includes private energy, timber and so forth. Then the remainder of the portfolio is in more liquid stocks and bonds. Some of that may include hedge funds or absolute return portfolios, but we consider those more core liquid or semi-liquid strategies.

Trusted Insight: How are you looking to reposition your portfolio as you go forward in your role as chief investment officer?

Mauricia Geissler: Our focus has really been more in continued consolidation and concentration, and incrementally increasing our allocations to our highest conviction managers, both in the core and the non-marketable portfolio. We work with probably 73 sustaining managers today. I wouldn't be surprised if we reduce that number a bit over the next 18 to 24 months. It's really, about noodling around the edges to make the portfolio even stronger and more resilient in today's low return environment.

Trusted Insight: You mentioned you have 73 managers, which is quite a significant number. Is there anything that you look for in particular when selecting those managers?

We tend to prefer to work with smaller, independent managers who are highly invested in what they do and, as we say, "skin in the game" alongside us. We like that they eat the same portfolio that they're providing for us.

Mauricia Geissler: There are several variables that we look at. We tend to prefer to work with smaller, independent managers who are highly invested in what they do and, as we say, "skin in the game" alongside us. We like that they eat the same portfolio that they're providing for us. We definitely prefer owner-operators and portfolios with a broader mandate.

We're also looking at people who run and invest in solid sustainable businesses. While we're not specifically focused on ESG-type variables, we want to know that our managers are thinking about those types of things with the companies that they are investing in. We want our managers to invest in businesses that will be around for the next several decades and are operating in a sustainable way.

Trusted Insight: You mentioned that endowments are very innovative and forward-looking, and different to areas of investment as a result. How do you approach innovation in investments?

Mauricia Geissler: Given the current market environment it's hard to really tell what will be the next innovation and opportunity. I think it's an interesting transition period. However, I do think running a portfolio that's focused on absolute return and real return, rather than benchmark orientation -- which is the case with a lot of pensions and bigger pools of money -- is a good approach.

Part of the reason we enjoy working with managers who have a fairly broad mandate is because they're in the market every day. They're looking for things that are out of favor or new things that are trending. So I think it has a lot to do with the type of managers that you are willing to engage with, and giving them free reign to go find that next new-new thing and demonstrate that it is a place where you can make money. We're not going to go out ourselves and say, "This segment of the market is the new place to be.” Instead, we look to hiring partners who will drive us to those spaces.

We do try and be thoughtful about new opportunities; as an example, we've talked a lot about opportunities in sub-Saharan Africa. While we're not there today, we have one manager who will opportunistically invest in some of those economies. It's an ongoing dialog with them, alongside our own research in that space, to identify where we should be thinking about committing dollars to in the next 18 to 24 months.

Trusted Insight: Is that affected by the fact that you're quite a small close-knit team?

Mauricia Geissler: The size of our team definitely does create some limits. We can't be everywhere. We can't look at everything. I think having managers with broader mandates allows us to hear about and focus our research in spaces that are new to them as well. If there are unique opportunities, then we can take advantage of those, perhaps as a result of hearing it from one of these managers first.

We do try to leverage multiple avenues when we think about new opportunities. As I say, one of those avenues is our existing managers, because they're doing it every day. Second is our peers and our business, who might be looking at things a little bit differently from us. Third is Amherst College’s alumni who happen to be in the investment business. Fourth -- and most importantly -- is our investment committee. This is a subcommittee of our board of trustees which we work with in partnership in managing the portfolio. It's a group of eight Amherst College alumni who are all in our business in some way, shape, or form. Many of them are global players. I think it's a fabulous group of individuals, who are very thoughtful and connected people. There’s not an opportunity that we're heavily researching where we haven't had a discussion with the investment committee to ask, "What are your thoughts? Are we barking up the right tree or not?" We leverage multiple points of information before we do a deep-dive into a space that might not yield anything.

Trusted Insight: Can you tell me a little bit more about the team and Amherst College. What do you think makes them special in terms of characteristics or culture?

Mauricia Geissler: It’s a fairly small team of six individuals. We will grow to seven later this spring with a new hire. It's a team that I've built, which I love, because they have all come here with a focus on managing an endowment for the college. The two gentlemen who work most closely with me on a lot of the investment management facing work are both Liberal Arts grads, so they understand the benefits of the Liberal Arts education. While they are not Amherst alumni, they are thrilled to be working at an institution where the endowment is so integral to supporting the institution and helps provide financial aid to so many of the kids that come to Amherst College.

I do think having a generalist focus amongst the team is also an attraction. You get to see the whole portfolio. You're not siloed as you might be at a bigger institution, as is the case with a lot of pension funds where you work in public equities, public fixed income, or real estate. I do think that's an attractive opportunity, no matter where you are in your career development.

We're a flat organization. We do everything as a team. While one person may be leading the charge in research on a particular manager or a segment of the market, it's a very collegiate environment. We all fit in a pretty open office space. We can have a dialog throughout the day, and yet still be very focused on the work that needs to get done. We do a lot of fun things outside the office together too. When we're in the office though, we work darn hard to make sure we're doing everything we need to in order to make money for the college.

Trusted Insight: Compared to other institutions, endowments typically have more women in senior investment roles. What do you think makes endowments so successful in attracting women to investment roles?

Mauricia Geissler: Perhaps it’s because the trustees and committees that are charged with oversight are more open to the possibility of having women in a senior role. Part of the innovative nature of foundations and endowments is they don't have a fixed mindset as to what is going to work well. I think we all operate a little bit differently, even within the endowment space. What's right for one isn't always right for the other. So I think it could just be part of the innovativeness of the endowment space itself.

Trusted Insight: What career advice would you give to someone who is looking to become a chief investment officer?

Always be open minded and flexible in your thinking. Think about not only the team that you're managing directly that oversees the portfolio, but also the folks that you need to report to. Those are two very different audiences, but they're all focused on the same mission.

Mauricia Geissler: Always be open minded and flexible in your thinking. Think about not only the team that you're managing directly that oversees the portfolio, but also the folks that you need to report to. Those are two very different audiences, but they're all focused on the same mission.

If you keep things very focused on the mission of the institution that you are supporting, then the job is not just a job -- it's a passion. I think you have to be connected or believe in the mission of the institution that you work for. That just makes it that much more exciting. There's good and bad with every job, but it makes the bad days not seem so bad! I think it's a lot of fun, and it allows for a lot of creativity and flexibility in how you get things done.

Trusted Insight: Outside of investing, what else gets you out of bed in the morning?

Mauricia Geissler: I'm very passionate about creating opportunities for people to get a college degree. I'm a first generation college graduate in my own family. Knowing that the work that I do everyday provides the opportunity for first-time college kids to come to Amherst College makes working for an endowment that much more exciting to me.

The other thing that I never forget is that it's very important to give back; whether it's in the work you do, or your activities outside of work. I'm involved in several local community organizations where the opportunity and the ability to contribute in that way keeps me engaged.

To learn more about the women who are leaders in institutional investing, read Trusted Insight’s list of Top 30 Women CIOs.