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Richard, George (ed.) / Wisconsin alumnus
Volume 59, Number 2 (Oct. 1957)

Brittingham, Thomas E., Jr.
"Bold" investments pay off,   pp. [23]-26

Page 24

search Foundation, here disclosed in de-
tail for the first time. After considerable
thought, the Trustees of WARF have
decided to make public-the Foundation's
record of investment accomplishment
since its inception in 1927. Parts of this
record have been revealed annually in
the research grants made by the Founda-
tion to the University of Wisconsin,
which every year has received the major
part of the Foundation's investment
  The growth of these grants, which
now considerably exceed a million dol-
lars a year, has aroused a great deal of
interest in the Foundation's policies. The
total record is a provocative one, and it
is believed that knowledge concerning it,
if made more generally available, might
stimulate and aid investment policies of
other educational institutions, charities
and fiduciaries.
  Every organization, to be sure, has its
own peculiar problems and demands.
Consequently, its investment-policy must
be developed from a careful analysis of
its basic function. University endowment
funds function primarily to produce in-
come. Moreover, the liability side of a
university balance sheet includes few
items that result in sudden or substantial
calls upon the fund.
   WARF's annual grant to the Univer-
sity of Wisconsin, used to support re-
search in the natural sciences, is admin-
istered separately from funds the uni-
versity receives for its teaching and re-
search programs. There are, fortunately,
no restrictions on investment policy; any
proportion of the fund can be invested
in any type of enterprise or security.
Otherwise, there is little difference be-
tween WARF's operation and purpose
and those of other college investment
  WARF is a rare example of an or-
ganization in which assets have been
built up by the development of ideas and
patents of the members of a university
faculty, rather than by the usual alumni
gifts. Very recently, the Foundation has
inaugurated life income contracts as an
additional source of funds. WARF was
formed to protect and develop an ex-
tremely valuable patent on a method,
discovered by the noted Professor Harry
Steenbock, of synthesizing vitamin D in
food and medicinal products by artificial
irradiation. The only outside capital was
$900, contributed at the time of organi-
zation by the Foundation's nine original
  Over the years, faculty members have
contributed other patents and ideas. The
second most valuable contribution was
Warfarin (named after the Founda-
tion), currently the leading rat killer in
the U. S. To date, WARF has netted
$11 million from patent activities, and
$29 million from investments. The mar-
ket value of the portfolio on Dec. 31,
1956 (see chart), was $40,050,000. In
the past 30 years the Foundation also
has made payments of $13,122,000
from securities income for the support
of research at the University ...
   (A number of case examples involv-
ing investments in stock generally con-
sidered "safe" have impressed the
WARF Trustees, and have helped to
shape their investment policies. The
guiding philosophy was stated in an
article which the author wrote for Bar-
ron's in 1939:
   "I believe that the age-old theory of
the favorite, well-known stocks being
the only investment for widows and or-
phans is all wrong. Hindsight and sta-
tistics show that investing in the popu-
lar favorites for the long pull is the
surest way toward an ever-decreasing in-
come and a diminishing capital.
  "Just as no racing enthusiast would
buy an old stud horse to compete with
younger horses whose records give
promise of many more years of racing
             ABOUT THE AUTHOR
  Thomas E. Brittingham Jr., '21, scarcely needs intro-
duction to fellow alumni of the University of Wiscon-
sin. A former president of the Wisconsin Alumni As-
sociation, he now is president of the Wisconsin
Alumni Research Foundation Board of Trustees. One
of the University's most generous and thoughtful
friends, Brittingham has long been a top-ranking ex-
pert in the field of finance. In recent years this invest-
ment economist has gained additional fame as sponsor
of several international scholarship programs.
  Associated with Brittingham on the WARF Board
of Trustees are Walter A. Frautschi, '24, vice-president,
Democrat Printing Co.; Bernhard Mautz Jr., '22, presi-
dent, Mautz Paint and Varnish Co.; Harry A. Bullis,
'17, chairman of the board, General Mills Inc.; Charles
L. Byron, '08, Chicago attorney in the firm of Wilkin-
son, Huxley, Byron and Hume; Armin Elmendorf, '17,
president, Elmendorf Research Inc.; Ralph B. Johnson,
'17, general partner in Smith, Barney and Co. Invest-
ment Bankers; William R. Kellett, '22, vice-president,
Kimberly-Clark Corp.; Myron Krueger, '35, executive
vice-president, Raymond Concrete Pile Co.; Samuel
Lenher, '24, vice-president and member of executive
committee, E. I. Dupont Co.; W. B. Murphy, '28,
president, Campbell Soup Co.; Arthur C. Nielsen Sr.
'18, chairman of the board, A. C. Nielsen Co.; Donald
C. Slichter, '22, vice-president, Northwestern Mutual
Life Insurance Co., and Charles S. Pearce, '00, former
chairman of the board of the Colgate-Palmolive Co.

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