(Bloomberg) — When AI-focused hedge fund Situational Awareness lost more than two-thirds of its $45 billion in July, most of the investors who took the hit were wealthy individuals and tech founders.
One of the few institutions in the mix was the University of Virginia, according to people familiar with the matter. Its investing chief, Robert Durden, had made a bet that few of his peers would touch, giving money to the hedge fund’s 24-year-old founder, Leopold Aschenbrenner, last year.
A representative for the University of Virginia Investment Management Co., which oversees its endowment and other capital, declined to comment, as did a spokesperson for Situational Awareness.
Situational Awareness soared 200% in 2025 and gained more than 400% in the first half of this year, supercharging its returns with borrowed money. Those gains made it one of the world’s biggest hedge funds before margin calls forced it to sell the bulk of its public portfolio in July.
The hedge fund’s pre-selloff gains are reflected in UVA’s returns for its last fiscal year, which ended June 30. The university’s long-term investments, including its endowment, gained 27% for the 12 months ended June 30, according to people familiar with the matter.
This brings its assets to a school-record $18.8 billion, about half of which is its endowment, the people said. That eclipses its prior-year performance of 12.4%.
When college endowments begin reporting returns in the coming weeks, UVA’s will likely rival others that invested in SpaceX and other AI firms. The University of North Carolina’s endowment returns were buoyed by a longtime SpaceX bet and soared past 30% for the most recent fiscal year, Bloomberg reported.
July’s technology rout will be next year’s problem. As AI and other related shares plunged that month, Aschenbrenner sold a substantial portion of its publicly traded stocks to Ken Griffin’s Citadel to meet the margin calls. Even after the tumble, the fund was still up around 80% for the year.
UVIMCO made money on its Situational Awareness investment, some of the people said. It doesn’t report the size or timing of its investments or the identity of the roughly 90 outside money managers it uses.
The university’s investment manager held $1.3 billion in long-short stock funds as of June 30, 2025, according to its tax filing.
Aschenbrenner, who graduated from Columbia University at the top of his class at age 19, rose to prominence in Silicon Valley with a June 2024 paper called Situational Awareness that expounded on the promise and perils of AI.
The following month, Aschenbrenner, who had worked as a researcher at OpenAI, founded an investment firm with the same name.
Early investors included Stripe co-founders Patrick and John Collison. Prominent tech backers Daniel Gross and Nat Friedman, who are now involved in Meta Platforms Inc.’s AI efforts, also got in early. Trading firm Jane Street invested as well and subsequently posted its first monthly slump in about a decade in July.
Many institutions — which typically have strict risk-management protocols — steered clear, though, citing Aschenbrenner’s lack of investing experience and small staff.
UVA’s portfolio lagged behind its market benchmarks in past years, largely because it was less invested in big tech names that dominate stock indexes, according to a university report from December. Situational Awareness presented an opportunity to catch up. And Durden had been keen on AI and technology bets, some of the people said.
