In graduate school, Mendillo was an academic standout. "She was the star of my class by far -- a fabulous student," says Richard Levin, 63, her former economics professor and now the president of Yale. "Some people learn economics and have intuitive aptitude for the subject. She was among those."
In 1983, Mendillo made her classmates laugh at a spring follies skit in which students lampooned Levin. As students in the skit pretended to nod off during a long, post-lunch lecture, Mendillo suddenly let out a bloodcurdling scream, says Hoffman, Mendillo's former classmate.
The sketch was so popular that people were still talking about it last year at the class's 25-year reunion, Hoffman, 55, says. Levin was played by another classmate, Ralph Earle, now Mendillo's husband of 24 years. Earle, a consultant, and Mendillo have two teenage children.
Steel and Insurance
Mendillo joined Harvard in 1987 after learning about an opening from Michael Eisenson, a fellow Yale alumnus who worked at Harvard. She became a stock picker, assigned to steel and insurance -- two industries no one else wanted to cover, she says. She later oversaw trusts and gifts.
It was the endowment's heyday. Meyer, a Harvard MBA who had previously managed the Rockefeller Foundation's investments, had assembled a team of in-house traders that handled 85 percent of Harvard's endowment, compared with about 30 percent today.
Meyer assigned Mendillo to push into timberland, an area now managed by a team that invests in natural resources around the world, including agriculture in South America. "There weren't many institutional investors," Mendillo says. "Pricing was extremely inefficient. We were able to go in and look for things that were significantly underpriced relative to their intrinsic value."
Meyer's investments were less liquid than the traditional portfolios of U.S. stocks and bonds that Harvard had bought in the past.
Managers Rewarded
The bets paid off. From 2000 to 2003, as the Nasdaq Composite Index tumbled more than 60 percent, Harvard was shielded. It fell 2.7 percent in the 12 months ended on June 30, 2001, and 0.5 percent the following year and then gained 12.5 percent a year later.