Nick and Jack

GPS, lithium-ion batteries, even the nuclear bomb, all of them originally started with funding from the government for academic institutions. Now, on an annual basis, Harvard gets a little under $700 million in federal money. So we know what you must be thinking, besties.

GPS, lithium-ion batteries, even the nuclear bomb, all of them originally started with funding from the government for academic institutions. Now, on an annual basis, Harvard gets a little under $700 million in federal money. So we know what you must be thinking, besties.

Surely, with Harvard's $50 billion endowment, an endowment worth more than the company of Volkswagen, Harvard can afford this cut in funding. It's not just Harvard, and not just the Ivy Leagues either. Over 100 colleges and universities in America have endowments over a billion dollars.

Surely, with Harvard's $50 billion endowment, an endowment worth more than the company of Volkswagen, Harvard can afford this cut in funding. It's not just Harvard, and not just the Ivy Leagues either. Over 100 colleges and universities in America have endowments over a billion dollars.

Surely, with Harvard's $50 billion endowment, an endowment worth more than the company of Volkswagen, Harvard can afford this cut in funding. It's not just Harvard, and not just the Ivy Leagues either. Over 100 colleges and universities in America have endowments over a billion dollars.

Another way to think about the university system is that our biggest colleges are actually hedge funds that use education as their marketing arm.

Another way to think about the university system is that our biggest colleges are actually hedge funds that use education as their marketing arm.

Another way to think about the university system is that our biggest colleges are actually hedge funds that use education as their marketing arm.

Financially, you could look at it that way. Well, here's what universities do with those endowments. Spoiler, they don't spend them. So Jack, what's the takeaway for all our buddies in education? You don't spend the endowment. You only spend the returns. Now, Yetis, many of you are probably thinking, yeah, Harvard, they got the smallest violin in the world right now. $50 billion is an endowment.

Financially, you could look at it that way. Well, here's what universities do with those endowments. Spoiler, they don't spend them. So Jack, what's the takeaway for all our buddies in education? You don't spend the endowment. You only spend the returns. Now, Yetis, many of you are probably thinking, yeah, Harvard, they got the smallest violin in the world right now. $50 billion is an endowment.

Financially, you could look at it that way. Well, here's what universities do with those endowments. Spoiler, they don't spend them. So Jack, what's the takeaway for all our buddies in education? You don't spend the endowment. You only spend the returns. Now, Yetis, many of you are probably thinking, yeah, Harvard, they got the smallest violin in the world right now. $50 billion is an endowment.

Why would they need taxpayer money? But the point of an endowment isn't to spend it. It's only to spend the returns. The point of the endowment is to not spend the endowment. Seriously. That's the point. Let's say conservatively that Harvard's endowment makes 5% in returns a year because that endowment is invested in stocks and bonds, which grow every year.

Why would they need taxpayer money? But the point of an endowment isn't to spend it. It's only to spend the returns. The point of the endowment is to not spend the endowment. Seriously. That's the point. Let's say conservatively that Harvard's endowment makes 5% in returns a year because that endowment is invested in stocks and bonds, which grow every year.

Why would they need taxpayer money? But the point of an endowment isn't to spend it. It's only to spend the returns. The point of the endowment is to not spend the endowment. Seriously. That's the point. Let's say conservatively that Harvard's endowment makes 5% in returns a year because that endowment is invested in stocks and bonds, which grow every year.

Those 5% returns, that's the part that Harvard actually spends. But they do not spend the principal, the $50 billion endowment. And that 5% return on a $50 billion endowment, Jack, can you do the math for us, please, over there? We're talking $2.5 billion a year that goes to the university's budget thanks to the endowment. $2.5 billion in returns just from the endowment.

Those 5% returns, that's the part that Harvard actually spends. But they do not spend the principal, the $50 billion endowment. And that 5% return on a $50 billion endowment, Jack, can you do the math for us, please, over there? We're talking $2.5 billion a year that goes to the university's budget thanks to the endowment. $2.5 billion in returns just from the endowment.

Those 5% returns, that's the part that Harvard actually spends. But they do not spend the principal, the $50 billion endowment. And that 5% return on a $50 billion endowment, Jack, can you do the math for us, please, over there? We're talking $2.5 billion a year that goes to the university's budget thanks to the endowment. $2.5 billion in returns just from the endowment.

Jack and I crunched the numbers on it. Technically, that is more than enough to cover the tuition of all undergrads and grads at Harvard every year. Now, if you spent the $50 billion principal part, then every year the endowment would get smaller and smaller, and eventually it would become zero.

Jack and I crunched the numbers on it. Technically, that is more than enough to cover the tuition of all undergrads and grads at Harvard every year. Now, if you spent the $50 billion principal part, then every year the endowment would get smaller and smaller, and eventually it would become zero.

Jack and I crunched the numbers on it. Technically, that is more than enough to cover the tuition of all undergrads and grads at Harvard every year. Now, if you spent the $50 billion principal part, then every year the endowment would get smaller and smaller, and eventually it would become zero.