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Real money, real investment, real education

A bridge between academia and the professional world.

Real money, real investment, real education by Laura L. Otto

Dillon Essma will remember his last two years in UWM’s elite Investment Management Certificate Program (IMCP) as a time of intense commitment, especially since he was also taking some of his toughest accounting and finance courses.

“It requires a pretty decent work ethic,” says the recent alumnus who finished with a double major. “We treated the [IMCP] program as a part-time job.”

Students in the specialty program are training for careers as investment analysts, financial analysts and investment advisers. Careers in investment management are among the highest-paid specialties in finance. Competition is the name of the game, and the risks are real.

Thanks to three benefactors in the field, the program’s students are learning by investing actual money – a large sum of it. They manage three funds that total more than $300,000, which Essma says was only part of the challenge.

“I wasn’t too worried about losing money from the fund,” he says. “But we were trying to outperform existing benchmarks on certain kinds of funds. That is what’s really hard to do.”

I wasn’t too worried about losing money from the fund. But we were trying to outperform existing benchmarks on certain kinds of funds. That is what’s really hard to do.

Dillon Essma, recent alumnus, Lubar School of Business

Paul Franke, a retired partner at William Blair, gave $100,000 to the students to begin their portfolios. David O. Nicholas of Nicholas Funds and Bill Nasgovitz of Heartland Funds followed suit, each donating $100,000. (This was not Nicholas’ first major gift to the Lubar School of Business. In 2008, he gave $2.5 million to build the Applied Finance Lab and create an endowment.)

It’s a lot of cash to put into the hands of novices, but overall the students in the three-year-old program have performed in line with benchmarks, says program director Kevin Spellman.

Nicholas says he is pleased with the direction in which the program is heading and with the caliber of students it attracts. Their management success, he adds, is not the most important metric for him.

“I wanted to continue my support by contributing to the amount the students had to manage. It was intended for the students to have a live learning experience, so the benefactors, myself included, knew what we were going into.”

Students will likely be dealing with greater pots of money soon after graduation, says Franke. His donation stemmed from his affection for his hometown and the UWM neighborhood where he grew up. “I hope that by supporting the program, the Lubar School not only can train students for investment careers, but also help support more employment in Milwaukee in the field.”

That is one of the goals of Spellman, who once was the director of research for a $50 billion pension fund.

He sees himself as the bridge between academia and the professional world. A UW-Madison grad who helped direct that school’s Applied Security Analysis Program while he was earning his Ph.D., Spellman came to UWM for the chance to build a new program.

“I also view this as a great opportunity to help the business community in this area and beyond,” he says.

Franke, Nasgovitz and Nicholas are three of the program’s many supporters. Nine companies have donated professional-grade software. For example, every IMCP student has FactSet, an investment analysis tool that may cost $25,000 per user. “Students use the same resources as professionals managing billions of dollars,” says Spellman.

The program engenders loyalty because of the special treatment the students receive and the resources available to them, he says. In January 2013, the program was accepted into the CFA (Chartered Financial Analyst) Institute University Recognition Program.

Essma’s dedication paid off: He accepted a job offer ahead of his December graduation from Green Street Advisors, a provider of real estate investment research located in Southern California.