Meyer adds that there was less interest in venture capital investing 10 years ago.

Don't miss the boat

Universities across the country are biting at the bit to get their stake in venture capital.

The percentage of university endowment money invested in nonmarketable securities, largely venture capital, increased from 3.6 percent in 1990 to 7.2 percent in 1999, according to the National Association of College and University Business Officers. Among private universities, the investment is even higher.

Higgins says universities are the ideal investors for venture capital. Since only the interest on the endowments is spent, he says, investors do not panic during temporary downturns and understand the importance of long-term investing. Over half of Highland's institutional investors are university endowments.

The success of venture capital has given some schools handsome rewards. Williams College saw a 29 percent rate of return from its endowment for the year ending June 30, 1999, thanks to shifting from traditional stock investments to venture capital and similar nonmarketable investments.

This rate of return on the endowment played a large part in Williams' decision not to increase its tuition levels for the coming year, an unprecedented occurrence for a private selective college.

According to Williams College Treasurer Doug W. Phillips, the school's goal is a 25 percent investment in private equity, one half of which is venture capital.