In the decade ended in June 2005, the endowment gained 16.1 percent annually compared with an 11.8 percent increase in the university's internal benchmark.

Meyer rewarded his top managers richly. Star bond traders Maurice Samuels and David Mittelman were the highest paid in 2003, earning $35.1 million and $34.1 million apiece. The fat paychecks aroused the ire of alumni, who said the money would be better spent on scholarships.

Some members of the class of 1969 wrote a letter of protest to Summers in 2003. Harvard spokesman John Longbrake says the fund's operating costs, including pay and bonuses, amount to only 0.3 percent of funds under management.

The complaints prompted some managers to quit and set up their own firms. Meyer himself quit in 2005, taking more than 30 Harvard staff members with him. His Boston-based Convexity Capital Management LP as of Dec. 31 managed $10.6 billion for college endowments, including a commitment of $500 million from Harvard.

Move To Wellesley

Mendillo, who oversaw $7 billion as vice president of external investments at Harvard, left in 2002 to become the first chief investment officer at nearby Wellesley College.

There, she generated returns that averaged 13.5 percent annually compared with 11 percent for the Standard & Poor's 500 Index in the same period. Mendillo diversified the Wellesley portfolio from stocks and bonds to so-called alternative assets including private equity and real estate, a strategy popularized by her former boss Meyer and David Swensen, the top-performing endowment manager at Yale, on whose investment committee she sat from 2002 to 2008.

When Mendillo returned to Harvard, Wellesley had a $1.7 billion endowment.

El-Erian, who had previously overseen $28 billion of emerging-markets debt at Pimco, the world's biggest manager of bond funds, joined Harvard in February 2006. A graduate of Cambridge University with a doctorate from Oxford University and a former International Monetary Fund director, El-Erian had no prior connection to Harvard or experience managing an endowment with its multimanager, multi-asset-class structure.

While Meyer's own staff had managed as much as 85 percent of Harvard's money, the percentage shrank under El-Erian to about 30 percent. That was partly because so many in-house managers had left with Meyer.

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