Adage Capital Management was founded in 2001 by Phillip Gloss and Robert Atchinson in Boston. Today Adage manages 13.5 billion dollars mainly investing in S&P 500 stocks and counts university endowments and charitable foundations such as Northwestern University, Dartmouth College, the American Red Cross, and the Getty Foundation among its prestigious clients.
Mr. Gloss spent eighteen years at Harvard Management Company where he first began as a healthcare and retail analyst, eventually becoming a partner. He and Mr. Atchinson, who also worked at HMC, formed a team within the endowment that exceeded the S&P 500 index each year by an average of four and a half percent. During these years they built an impressive record and reputation. Mr. Jack Meyer, the then HMC president and CEO, expressed his anguish when the duo decided to depart by calling it “a major disappointment”.
The two former Harvard Management Company (HMC) money managers (along with other colleagues) started the firm with a $3.8 billion commitment given to them by HMC. The huge commitment was most remarkable as it represented close to 25% of the endowment’s assets at the time. The trust placed in the duo has been well vindicated as the firm has outperformed the S&P 500 Index by over three percentage points annually since its inception. While in the financial crisis of 2008 the fund lost thirty eight percent, it immediately recuperated by forty one percent in 2009.
It is not a secret that Harvard University has graduated its share of high profile politicians and lawyers, but what is sometimes overlooked is that it has also been a launching pad for some of the most successful money managers. When Mr. Gloss and Mr. Atchinson, both of whom worked for many years at Harvard’s endowment, stepped out in 2001 to launch Adage Capital Management, they became part of an elite group of the university’s former endowment managers who attained stature at “outside” hedge funds and private equity firms after leaving Harvard to go on their own. This group is often referred to as the Crimson Cubs (as opposed to the Tiger Cubs).