Hmmm…..

The problem with having an outside financial beneficiary (as the case is with UNLV) is his relationship, and then potential tension, with the institution. Now, I am not sure whether he is even a UNLV alum, and this may present problems down the road. So while everyone likes money and boosters, the booster’s money comes with its own clauses, either implicit and/or explicit, and usually, at some point, they come into to contrast with the mission of the institution.

Now, like anything else in this world–there are exceptions to the rule. So, lets consider the donation of Boone Pickens to his alma mater, Okl State. One, he was an alum, and already knew much of the politics and inner workings of not just the university, but also the leadership of the state. Two, the gift was so large, at the end of the day, close to 200 million, that it was actually over half the size of their total endowment (which is close to 380 million). Three, he has many strings attached–and not all were altruistic. For instance, he negotiated that he actually also financially manage the money.

So, what’s the big deal on that? Well, he still get a huge deduction, which in turn helps his tax position in the short and long run. But, it also means, he gets paid for it at the same time, as he takes a management fee, plus a percentage of profits (which is the usual compensation structure for hedge funds etc). Long-story short, he was moby dick, the giant whale, in which he become indispensable to OSU. Not quite sure, whether the UNLV fellow is in the same class or has that type of liquidity (many folks have a large net worth–not many have liquidity). What I will say, is that once you notch a couple of losing seasons in W-L column, we will have a much better vantage on his ability to see if he is in this for the long haul.