Harvard University to raise record $6.5 bn

Harvard University, the richest university in the US, plans to raise $6.5 billion by 2018, an effort, if successful, would be the largest ever in higher education.

The massive fundraising drive is $3 million more that the $6.2 billion raised last year by California-based Stanford University.

Harvard president, Drew Gilpin Faust said that the fundraising campaign will help the university to meet the world's increasingly complex and pressing needs.

The funds raised by Cambridge, Massachusetts-based Harvard will be used to expand School of Engineering and Applied Science, modernising student housing, the arts and humanities, along with the fields of energy, neuroscience and stem cell research.

About 45 per cent of the money raised will go to research, faculty and teaching, about 25 per cent will be earmarked for student financial aid, 20 per cent for construction and renovation, and 10 per cent to support new initiatives, Harvard said in a statement.

Harvard's last fundraising in 1999 raised $2.6 billion, but saw its endowment lose 27.3 per cent or $11 billion, to $26 billion during the 2008 global financial crisis, causing operating budgets to sink hundreds of millions into the red and forcing the rethinking of earlier University expansion plans at its Allston campus. (See: Recession drags Harvard and Yale endowments down)

Faust said that the University's endowment stood at $30.7 billion last year, but cautioned against thinking of the endowment as a ''checking account'' that can be drawn down at will.

The endowment is a linked pool of thousands of funds, most of them dedicated to specific purposes - such as named chairs or individual institutes or programs, that must be managed into perpetuity, a feature that limits the funds that can be withdrawn in any given year to about 5 per cent.

Harvard unveiled its campaign at an event at Sanders Theatre attended by Microsoft founder Bill Gates, who spent three years at the school in the 1970s and David Rubenstein, founder of the private equity firm Carlyle Group.

Speaking on the occasion, Gates spoke about his early business dealings with Apple, his friendship with Berkshire Hathaway chairman and CEO Warren Buffett, his bridge-playing habit, which he shares with Buffett, and how Buffett came to give billions to the Gates Foundation.