Earlier this year, Commonfund, in partnership with the National Association of College and University Business Officers (NACUBO), released the 2025 NACUBO-Commonfund Study of Endowments (NCSE, or, the “Study”). The Study examines investment performance, governance and management practices at hundreds of U.S. higher education endowments and related foundations over the July 1, 2024 – June 30, 2025 fiscal year (FY2025).
Following the release of the FY2025 study, Commonfund did a deep dive into results from 326 institutions that are less often in the spotlight: those with fewer than $250 million in endowed assets, which made up nearly half of the study’s total participants. In the full Study, the cohorts are divided between those with fewer than $50 million, $51 to $100 million, and $101 to $250 million. Below, we break these cohorts down into even smaller size cohorts, providing more niche analysis of top-line results, and demonstrating the importance of participation across the endowment size spectrum. Note: Additional analysis across size cohorts and types of schools is included in the full report.
THE TOP-LINE RESULTS
Asset Size
In total, there were 326 institutions that participated in the Study with less than $250 million in endowed assets, representing nearly 50 percent of the 657 total institutions that participated. For this analysis, cohorts with assets under $100 million are segmented into increments of $25 million, and those with over $101 million are segmented by increments of $50 million.
|
Endowment Size |
Responding Institutions (#) |
Average Endowment Size ($ in millions) |
|
Under $25M |
25 |
14.3 |
|
$25-$50M |
51 |
39.2 |
|
$51-$75M |
48 |
63.3 |
|
$76-$100M |
48 |
87.1 |
|
$101-$150M |
73 |
120.1 |
|
$151-$200M |
46 |
171.5 |
|
$201-$250M |
35 |
223.9 |
1-Year Returns
Trends in 1-year net annualized returns in fiscal 2025 were uncorrelated with size: cohorts spanning asset sizes from $25 million and $100 million reported 1-year returns of 11.0 percent or higher, on average. Meanwhile institutions with assets under $25 million, as well as those with assets between $101 million and $250 million, ranged from 10.0 percent (for those under $25 million) to 10.8 percent ($151-$200 million), on average.
All cohorts in this analysis reported 1-year returns in FY2025 that were lower than those in FY2024 – except for the $76-$100 million cohort, which maintained 11.2 percent returns in both years, on average. The most dramatic shift in year-over-year performance was reported by the smallest cohort: those with under $25 million fell from 14.5 percent in FY2024 (the highest among these groups) to 10.0 percent in FY2025 (the lowest among these cohorts), on average.
10-Year Returns
Historically the Study has shown relatively strong long-term returns among larger institutions when compared with smaller institutions. However, outperformance in 1-year returns among smaller institutions over the past few years contributed to this trend being muted in FY2025, if not reversed in some instances. For the second Study in a row, 10-year returns were relatively consistent across small cohorts, with results ranging from 7.6 percent among those with $25-$50 million to 7.2 percent for those with under $25 million, on average. The positive news: 10-year reported returns in FY2025 outperformed those reported in FY2024 by 70 basis points or more for each cohort analyzed.
Asset Allocation
Asset allocation among these size cohorts also tends to mirror trends in the broader report. The most apparent finding is the positive correlation between endowment size and allocation to alternatives strategies, which is common due to larger institutions’ ability to take on illiquidity, and their availability of resources to effectively manage an alternatives portfolio. The smallest cohort had an allocation of 2 percent, while those with $201-$250 million allocated 10 times more – 20 percent – on average. Meanwhile smaller cohorts tended to overweight fixed income and publicly traded equities, on average, relative to larger peers.
Spending
Effective spending rates1 among these cohorts ranged from 4.1 percent for institutions with assets under $25 million to 6.2 percent for those between $51 and $75 million. Meanwhile, median effective spend rates ranged from 3.8 percent to 4.5 percent – indicating that there are several outliers with significantly higher spend rates across size cohorts.
But what was that spending for? The smallest institutions reported that they spent more than two-thirds of their total endowment distributions on financial aid – a critical factor in student enrollment – compared with less than half of total distributions for the largest group, on average. The share of total endowment spending for financial aid declines with endowment size, while the share contributing to academic programs, research, and faculty, rise as endowment size increases, on average.
Overall, these findings suggest that these institutions are making the most of relatively small endowments through disciplined investment practices, strong recent performance, and dedication to the mission of education. Relatively conservative asset allocations and lower spending rates reflect both prudent stewardship and the constraints of managing more modest resources. Trends underscore both the resilience of smaller institutions and the ongoing need to strengthen their endowment capacity to support long-term stability and broaden their impact.
We hope these insights will serve as a guidepost for your own analysis into these important topics and we encourage you to read the Study in its entirety to best evaluate your performance vs. your benchmark or peers.
We also strive to continuously improve data quality and its value to your institution by boosting participation. If you are a higher education institution and interested in participating in the 2026 NACUBO-Commonfund Study of Endowments, please click here to find out how you can be a part of this year’s research.
