Saturday, June 15, 2024

John Townsend’s path from Lumberton to Wall Street serves up a big win for UNC Chapel Hill

A Lumberton native with impeccable Wall Street credentials — and a smart art collection — helps the UNC Tar Heels stay financially robust.

When John Townsend graduated from UNC Chapel Hill in 1977 with degrees in history and English, he felt ill-prepared for the working world. He and his wife, Marree, returned to his Lumberton hometown to work in the hog, tobacco and car-sales business that his family had developed over a couple of generations.

John Townsend

The couple built a home in Robeson County. “The plan was to spend the rest of our lives there,” he says.    

Three years later, Townsend had learned enough about the challenges of farm work that he concluded that its risk-reward didn’t fit his ambitions. He decided to reroute his life, returning to UNC’s business school in July 1980 to seek an MBA.   

“I didn’t want to look back and wonder what could I have done on my own,” he says. “I enrolled with the attitude that I was going to take two years out of life and work really hard, and I was going to go for it.”

His graduation timing proved perfect, with Wall Street on the verge of what Townsend calls “this great bull market that started in August of 1982. Business just took off.” 

New York investment firms were hiring MBAs at a record pace, aiming to keep up with the cascade of mergers and acquisitions spurred by Michael Milken, Henry Kravis and other big investors. “If I had gotten there five years earlier or five years later, I might have fallen on my face,” Townsend says.  

There would be no face-plant. Townsend, 67, spent most of the next four decades at
leading U.S. investment firms, working alongside industry kingpins such as Dick Jenrette, Henry Paulson, Jon Corzine and Julian Robertson. He created major personal wealth along the way, leading to his current status as a major philanthropist whose biggest beneficiary
is his alma mater.

Townsend helped lead UNC Chapel Hill’s record capital campaign and chairs the board of its main investment fund.

In 2017, the Townsends pledged $50 million to UNC, including $25 million in art that will be displayed at the university’s Ackland Art Museum. When announcing the gift, Townsend noted in a speech that he and his wife had often made donations that were “designed to be large enough so that the recipient would be grateful, very grateful, but maybe we could have and should have done more.” 

The Townsends, who have been married for 45 years, initially considered a gift of $5 million to $10 million. Marree Townsend, who is a 1977 UNC graduate, is a longtime interior designer. Their donated art includes pieces by Alex Katz, Jasper Johns and Joan Mitchell.

“We challenged ourselves to get out of our comfort zone, and that is when we landed on this $50 million gift. It was the most liberating thing we have ever done. … You experience all these rewards, unanticipated, not tangible. I think that was a very defining moment for Marree and me when we made that commitment, very joyful.”   

Townsend urged others to make similar sacrifices, creating one of the sparks that ignited UNC’s Campaign for Carolina, which started in early 2015 and is scheduled to be completed by year’s end with pledges topping $4.6 billion — and perhaps more. That’s smashed the initial goal of $4.25 billion.

It’s the largest completed university capital campaign in the Southeast, says David Routh, the university’s vice chancellor of development who is retiring in December.

“There is no better friend to UNC than John Townsend in giving his time, talent and treasure,” he says.

Marree Townsend, John Townsend and Carolina donor Shannon Kennedy talk at a Chapel Hill event in 2017.

Monied mentors

When discussing his success on Wall Street, Townsend repeatedly deflects the credit. He cites two mentors, both from North Carolina and fellow UNC alumni, who served as bookends to his Wall Street career.   

His first job in New York was at Donaldson, Lufkin & Jenrette, a major firm then led by Raleigh native and UNC grad Dick Jenrette. “He was a wonderful gentleman and a great supporter of mine, which enabled me to advance quickly at the firm,” Townsend says.  

His last Wall Street post was a stint from 2010-15 at Tiger Management, the New York hedge fund led by Salisbury native Robertson, who died in August at the age of 90. “He was one of the legendary investors of the last 50 years,” Townsend says. “To start my career with one icon and end it with another, both from North Carolina, is a real highlight for me.”

After five years with the firm often called DLJ, Townsend joined Goldman Sachs in 1987, becoming a partner in 1992, the same year as former Treasury Secretary Henry Paulson. “It was like playing for the Yankees or the Celtics, or, better still, Dean Smith’s Tar Heels,” Townsend says.

Townsend’s jobs at Goldman included co-head of the Southern and Latin American regions and leveraged finance group. He was a member of the investment bank’s commitments committee, which placed the firm’s capital. He was among about 220 senior partners who shared Goldman’s profits before its 1999 initial public offering, which raised $3.6 billion. The IPO created eight- and nine-figure payouts for the famous bank’s senior leaders. 

In 2002, he was ready for a change after an illness in his family served as a wake-up call. Many veteran Goldman partners left after the IPO, including fellow North Carolinian Robert Steel, who departed in 2004 after a 28-year tenure and later shepherded the sale of Wachovia to Wells Fargo. Townsend says there was no acrimony. “My attitude was
if you are 47 years old and you are financially independent and you’ve got your health, you look forward to how to be purposeful.   

“So I needed to find a balance between being purposeful and doing important things on my terms. That was another watershed event, and for the next eight years, I worked completely independently, investing, trying to become better.”

Post-Goldman, Townsend became a member of the investment committee of Richmond, Virginia billionaire William Goodwin’s Riverstone Group real-estate company and was a senior adviser to Stone Point Capital, a $40 billion private-equity group in Greenwich, Connecticut. He was a director at Memphis-based International Paper from 2005-18 and Charlotte’s Belk department-store chain from 2005-15.

His hiring at Tiger Management in 2010 attracted media attention, coinciding with Julian Robertson’s plan to expand the business, which owns partial stakes in hedge-fund managers whose businesses were partly launched with Tiger money.  

He also became more active in charitable ventures associated with his personal interests and the communities where he has homes: Greenwich, Connecticut; Jackson, Wyoming; and Wilmington, where he owns a Figure Eight Island property. He has had board seats with the U.S. Ski & Snowboard and Grand Teton National Park foundations; the Greenwich Hospital in Connecticut; Virginia Theological Seminary; and Episcopal High School, where he is an alum. 

Blue blood

Although his interests are varied, UNC is at the center of Townsend’s orbit. He had a term on the UNC Chapel Hill board of trustees and has been a longtime director on the UNC Management Co. board. He chairs the UNC Investment Fund, which totals $10 billion and has had performance rankings in the top decile of university endowments in recent years.

 “I think UNC is one of the great public universities in the country and in many ways is the economic engine of the state,” he says. “It receives about $1.5 billion annually in research grants, which creates countless jobs and economic activity as well as planting the seeds for future growth in our economy. The future is very bright.” 

Chancellor Kevin Guskiewicz first met Townsend while dean of the College of Arts and Sciences. “His passion for Carolina, you can see it and feel it when you meet,”
Guskiewicz says. “He is a very thoughtful individual, very strategic about how he gives.   

“I think he wants to know that he and Marree are giving to areas of great need. He wants to embrace the rich traditions of UNC, and he also wants to make it a more contemporary university.”

When former Chancellor Carol Folt asked Townsend to lead the Campaign for Carolina, Routh says the investment banker responded with a question that shaped the effort: “Are you prepared to run a campaign like no other that has been run anywhere else?’  

“We said yes.”  

Townsend pushed for a goal of $5 billion, which he called “impossibly large,” while Folt floated $4.25 billion, which he calls “sufficiently ambitious.” It’s a couple of billion more than any previous capital campaign at UNC and tops the $3.8 billion raised in Duke University’s most recent fundraising.

With his family’s gift, Townsend asked UNC’s deans of the College of Arts and Sciences and Kenan-Flagler School of Business about their most urgent and strategic needs over the next decade, Routh says. Those meetings continue yearly. 

Some of the initiatives underway include construction of a  $150 million business school, with the cost split between private donors and state appropriations; and a new approach to teaching engineering skills even though UNC doesn’t have engineering majors.

While Townsend’s work on various boards and private investing keeps him busy, he spends a lot of time hiking, skiing and playing golf, where he has a single-digit handicap. He’s not climbing as much these days after reaching the peak of Grand Teton about 10 times. “Outdoors is where I am happiest,” he says, “and a place I can stay out of trouble.” 

For his philanthropy, Townsend shares the view of his friend Mike Bloomberg, the financial data billionaire and former New York mayor who quipped that he wanted his last check, written to an undertaker, to bounce.

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