The Red Lake Nation College (RLNC) has announced a recent transformational $7 million donation from MacKenzie Scott’s organization, Yield Giving. This unrestricted gift from MacKenzie Scott is for RLNC leaders to decide how to best impact and support the college.

RLNC receives 25% of its annual funding from private donations. This is the largest gift in the history of the college. The RLNC board and president have decided 100% of this contribution will be used to create a new permanent endowment fund that will empower the college to guarantee its long-term financial sustainability in perpetuity. RLNC board member, Sharon Norris said, “The entire college board, organization, and tribe are extremely grateful and thankful for the amazing generosity of MacKenzie Scott to help Red Lake Nation College. This is fantastic for us since Natives are usually the last to get funded and first to get cut.”

Guided by their Ojibwe Seven Grandfather Teachings, the RLNC board of regents, have chosen to steward this gift with a bold and forward-looking, seven generations horizon and commitment. Ojibwe teachings tell leaders to look seven generations into the future and visualize how today’s decisions will impact people seven generations from now. Following their philosophy, RLNC leadership wanted to make the biggest permanent impact with this unexpected gift for their students for several generations.

RLNC board chairman, Delwyn Holthusen Jr., said, “This is historic and this fund will end the poverty cycle for our college. The key is to put it all in a new fund, and let it grow and build, so we can get it to a point where we can use it to support us for anything we need. We will only use it for extreme emergencies in the first few generations, and pay it back with interest if we do take anything out so it always keeps growing. This permanent fund will be treated like a 401K fund for the college, with any withdrawals paid back with interest so the fund can always keep growing at a fast pace.” 

Chief Dan King, President of RLNC, said, “I am so proud of our RLNC board for having the courage and vision to look out for the long-term financial sustainability of our current and all future RLNC students. This is the start of a long, bold, and certain journey toward the end of poverty for our college. This new permanent fund follows our RLNC philosophy of running our college based on a ‘business model’ of operations.” 

The college points out that since 100% of this funding is unrestricted, RLNC can reinvest and let 100% of the fund grow, reinvest all of it, and use any of the funds for emergency purposes in the future. The unrestricted nature of the gift is a major benefit for the growth of the fund. However, the college has put tight internal restrictions on removing anything from the fund such as requiring all board members to sign for all withdrawals and requiring that it must be an extreme emergency, to be used only for college survival. Any withdrawal must be limited to just 40% of one year’s earning and paid back with interest.

Sovereign Investment Advisors were hired to manage the fund. The RLNC main investment goals of the fund are to seek 10% returns and double every seven years. This will be an appropriately aggressive, multi-generation, strategy utilizing private equity investments. The basis for the strategy is the “rule of 72” mathematical formula, the magic of compounding earnings and interest, and the 30-year historical stock market return average of about 10%.  According to President King, “Actually, we could do better than the 10% since our strategy is much longer term than most, and we will be utilizing some private equity investments. We are very confident of our investment strategy and our management team.”

The college projects that after 21 years, in 2046, the fund will hit $56 million. The college said they will strive to regularly add more donations to this fund to speed up the “end of poverty” process. After 35 years and in just one generation, it will reach $224 million if it hits their investment goals. The longer term projections are eye popping at two generations and 63 years, it is projected to reach $3.5 billion. At three generations in 91 years, the RLNC endowment fund will reach a staggering $57 billion. This would make it bigger than the current largest university endowment fund in the world, Harvard University’s Endowment, which is approximately $56 billion in 2025.