John Paulson, the American hedge fund manager and billionaire, donated $400 million to Harvard University this week.
The donation will go to Harvard’s School of Engineering and Applied Sciences which, strangely enough, will be renamed the “Harvard John A. Paulson School of Engineering and Applied Sciences”.
Donating money to an educational institution can never be a bad thing, can it?
Well, it depends on who you ask.
Malcolm Gladwell was pretty incensed about the donation, and spent an hour on Wednesday ranting about it.
It came down to helping the poor or giving the world's richest university $400 mil it doesn't need. Wise choice John! http://t.co/2bFmuTy397
— Malcolm Gladwell (@Gladwell) June 3, 2015
Gladwell appears to have been annoyed about the donation because Harvard just doesn’t need the money.
If billionaires don't step up, Harvard will soon be down to its last $30 billion.
— Malcolm Gladwell (@Gladwell) June 3, 2015
And while Gladwell’s outrage may be justified, and certainly Harvard (like Oxford) is not short of funds, the more interesting question is: what enables Harvard to attract such a large donation?
This is not a bible class but it does happen to say in Matthew 13:12 “For whoever has, to him more shall be given, and he will have an abundance.”
That’s all well and good, but what exactly is it that Harvard has that allows it to attract even more?
Here are three (3) ideas:
- Brand: Harvard is one of the world’s most prestigious and truly global brand names, up there with Oxford. By donating to Harvard, Paulson gains recognition by associating himself with an elite institution.
- Network: Harvard may provide education, but it is of an extremely elite variety. One of my friends from Sydney studied his MBA at Harvard, and one of the questions in the application form asked him to state his father’s occupation and salary. He refused to answer the question, and was accepted anyway, but the nature of the question shows you the kind of game that Harvard is playing. Harvard is a powerful network that empowers itself still further by bringing together people who are already very powerful, wealthy and connected.
- Scale: In addition to having a powerful brand and network, Harvard also has scale, teaching around 21,000 students at any one time. This is important because, the larger the scale, the bigger the impact that Paulson can claim that he is making. It also means that more high achieving and ambitious young people will be reminded each year of the true greatness of the ego of John Alfred Paulson.