Silicon Valley private schools launch in-house venture funds to boost endowments

Private schools in the Silicon Valley region are experimenting with miniature venture-capital funds, channeling donations from parents and alumni into early-stage, pre-IPO companies. Saint Francis High School pioneered the approach, earning a multi-million return when its $15,000 Snap stake ballooned to roughly $34 million after the 2017 IPO. Similar structures now exist at Crystal Springs Uplands School and Menlo School, with advisory boards that include partners from Lightspeed, Sequoia, Battery Ventures and other firms.

Because the funds are volunteer-run, they charge no fees or carry and, as 501(c)(3) entities, avoid capital-gains tax, enhancing net returns. Proceeds are earmarked for tuition assistance, teacher bonuses and campus improvements, while also providing students exposure to the venture ecosystem. Nonetheless, schools must accept long-term horizons, as venture returns often follow a J-curve that can span five to eight years. The model is attracting interest from other private schools across the country seeking to replicate its potential upside.