finance fun fact

Bill Ackman is feuding with Harvard: how a $10 million donation of Coupang’s stock led between a billionaire investor and the world’s largest university endowment. Billionaire activist investor Bill Ackman is currently beefing with his alma mater, Harvard, over a donation that he gave. The story goes that in 2017, Ackmann wanted Harvard to bring the economist Raj Chetty onto its faculty, but Ackman was going through a divorce at the time and “had no liquidity” But he did have stock in a private, venture-backed Korean e-commerce company called Coupang Inc. Instead of cash, Ackman pledged $10 million worth of Coupang Inc.’s private stock. But being the financier he is, Ackman structured the donation in an interesting way: - if his donation of Coupang stock fell below $10 million, Ackman would make up the difference - however, if Coupang went public and the value of Ackman’s $10 million donation exceeded $15 million, Ackman would be able to tell Harvard how he wanted the college to use the excess profits In other words, Harvard had a put option at a strike of $10 million & Ackman had a call option at a strike of $15 million. Fast forward to 2021, Coupang went public at a massive valuation, and Ackman's gift ballooned to a staggering $85 million. But then Ackman discovered that in March 2020, Harvard had quietly sold the stock back to the company for $10 million. Ackman argued this decision was economically unsound, as Coupang had made significant progress, and Harvard missed out on potential gains of $75 million. What's more, because Harvard failed to inform Ackman of the stock sale, Ackman was denied the opportunity to buy back the private shares, which he says he would’ve happily done. Ackman argues that Harvard, with its immense endowment, did not urgently need $10 million in liquidity, making the sale nonsensical. But from Harvard’s POV, these illiquid shares in a random startup didn’t fit into their endowments portfolio, so Harvard was just trying to do some spring cleaning. And to this day, Ackman believes that he still has the “right to allocate the $70m of excess proceeds to the Harvard-related initiative of my choice.” $CPNG #AckmanVsHarvard #CoupangSaga #HarvardInvesting #FinancialDrama #InvestmentAgreements #PhilanthropyGoneAwry #BillAckman #CoupangIPO #HarvardEndowment #FinanceStory #InvestmentStrategies #StockSaleDilemma #FOMO #fyp #fypage