Last spring, President and Chief Executive Officer of the Stanford Management Company Mike McCaffery announced his intention to step down from his position at Stanford Management Company (SMC). After five-and-a-half years of managing the Stanford endowment, McCaffery is leaving to form a private investment company similar to the one he headed—Robertson Stephens—before accepting the position of CEO at SMC.

"I informed the SMC Board that I intended to step down during fiscal year 2006 or at the latest, fiscal year 2007 because of my desire to return to the entrepreneurial business environment," McCaffery said. "I spent the first 25 years of my career in the investment banking and investment management industries. I wanted to start and build a new business."

A search for McCaffery's replacement will begin immediately, according to Ward Woods, a member of the Stanford Board of Trustees and chair of the SMC Board of Directors. During this process, McCaffery, a graduate of the Stanford Graduate School of Business, will remain at the University and act as a consultant to the new firm. Though he plans to leave as soon as a replacement is found, he is committed to stay as long as it takes to find a suitable successor.

"Mike McCaffery has been a leader in endowment investing and has provided stellar results for Stanford, as well as being a great friend of the University," Woods said. "He will be difficult to replace, and we appreciate that he is willing to stay on so long to ensure that we have the time to find another star performer to lead the Stanford Management Company."

The SMC was created in 2001 to oversee and manage University assets, both financial and otherwise. The company supervises the approximately $12 billion of endowment and trust assets, expendable funds and commercial real estate investments. Recently, the company has been flourishing under McCaffery's guidance.

"We are very pleased to be up 19.5 percent on the one-year," McCaffery said in a recent press release. "However, we are more focused on longer term results such as our five-year investment performance."

In addition to losing McCaffery, Chief Investment Officer Michael Ross and Managing Director of Private Equity David Burke left the SMC to join McCaffery at his new, unnamed investment company at the end of 2005.

"Mike Ross and Dave Burke left SMC as of Dec. 31; they will be my founding partners in this new investment management venture," McCaffery said. "They continue on consulting contracts to SMC during this transition period."

"We also wish Mike Ross and David Burke well in their new endeavor," Woods added.

Eric Upin will act as the interim chief investment officer in place of Ross. SMC Private Equity Directors Saguna Umerjee and Georganne Perkins, will take the place of Burke.

McCaffery spoke positively about his experience at Stanford. He plans to continue to help the University in any way possible.

"I feel extremely fortunate to have been CEO of SMC for the last few years, and SMC has achieved excellent performance as a result of the effort and commitment of an excellent investment staff, and an outstanding board of directors," McCaffery said. "I will miss being at Stanford on a daily basis, but I will continue to be committed to the University, and serve the University in any way that I can be helpful. In my opinion, Stanford is the greatest University in the world."