Crane Data was saddened to learn recently that the original money fund "guru," Bill Donoghue, passed away last month. Donoghue's Obituary explains, "William E. Donoghue, 75, of Seattle, Washington, died January 16, 2017 in Healdsburg, California. Donoghue was a respected author and investment expert best known for the growth of money market mutual funds, of which he raised awareness through newsletters, investment conferences, books, and television appearances." We excerpt from the obituary and reflect on our Peter Crane's relationship and history with Donoghue below.
The obituary continues, "While in graduate school, Donoghue met a professor who encouraged him to focus on cash management. He quickly became a leading expert on the subject, chairing financial management seminars and serving as editor of Donoghue's MoneyLetter. The periodical came out during a time of unusually high interest rates. In the 1980s, Donoghue was the leading analyst and monitor of the budding money market mutual fund industry. Along with MoneyLetter, he founded "Donoghue's Money Fund Average," a rating system for these interest-sensitive Investment vehicles."
It adds, "In 1981, he authored William E. Donoghue's Complete Money Market Guide (Harper & Row), which reached #3 on The New York Times best seller list, and he followed that successful first guide with a series of similar books. Establishing himself as a mutual fund expert, he began speaking on the topic and in 1994 started "Donoghue's Mutual Fund SuperStars," conferences that brought leading mutual fund investment advisors to the public."
Crane Data's Peter Crane comments on the Guest Book, "I had the pleasure of working with Bill in the 1990's after he had sold his Money Fund Report and Moneyletter newsletters to IBC. (I eventually became Editor of these publications for a time, working for what was then IBC/Donoghue.) The dramatic growth of money market mutual funds and mutual funds overall were in no small part driven by Bill's relentless preaching of their benefits. Those involved and invested in the $2.7 trillion money fund space owe him a debt of gratitude. His mantra of "safety, liquidity and yield" is still the cornerstone of cash investing today. Thanks Bill, and enjoy the big Blues show in the sky. We'll miss you."
Crane explains his relationship with Donoghue, "I started as an assistant editor for IBC/Donoghue in late 1993, and Bill was still involved though he had sold the business a few years earlier. He had run the business out of Holliston, Mass., originally, but it was based in Ashland, Mass. by the time I started working there. (Bill had moved out to Seattle by this time and would talk with us via speakerphone most of the time.) As I learned it, Bill had purchased the Money Fund Report newsletter in 1975 from Dan Butler. Money funds then rode a wave of popularity as interest rates rose to almost 20% during the two oil price and inflation spikes in the late 1970's and start of the '80's."
He continues, "Bill sold MFR and his newsletter and data business to International Business Communications (IBC), which later became Informa PLC, in the late '80's. The IBC/Donoghue unit became IBC Financial Data, then eventually iMoneyNet. (They sold away the Moneyletter newsletter around this time too.) I worked there for 13 years, 1993-2006, before leaving 11 years ago to form my own firm, Crane Data." (Note: Crane Data now competes with iMoneyNet in the money market fund rankings, averages and information space.)
Crane explains, "The first conference I attended was a 'Money Show' event in Orlando, where I met Bill in person. He was quite a character, holding court with all the mutual fund managers and representatives. But by this time he was on his way out of the money fund business. (As many founders that sell discover, you can't sell your company and run it too.) Bill moved on to the broader mutual fund world, running a money management firm and eventually writing for MarketWatch. But people referred to him and his money fund averages as the "Donoghue's numbers" for years afterwards."
He adds, "He deserves major credit for helping popularize money market funds, speaking and writing about the fast-growing new product tirelessly. Money fund managers and investors owe him a debt of gratitude for educating the broader public about the benefits and safety, liquidity and yield that these products brought. Our deepest condolences go out to his friends, business associates and family. We will miss him."
Tony Carfang, Managing Director of Treasury Strategies, comments, "Always larger than life, Bill was a cash management pioneer. His cash management seminars in Ft. Lauderdale in the late '70s and early '80s put a spotlight on this emerging field. He quickly understood that money funds, in an era of 13% interest rates, were well suited for corporate treasurers and became an unrelenting promoter. His newsletter was a 'must read' for bankers, treasurers and fund managers."
Finally, the obituary adds, "A visitation will be held at Bonney Watson Funeral Home, 1732 Broadway, Seattle, Washington, on Friday, March 3, 2017 from 2:00 to 5:00 p.m. The funeral will be held in the Chapel of Bonney Watson on Saturday, March 4, 2017 at 10:00 a.m. Interment will be at Mount Pleasant Cemetery on Queen Anne Hill in Seattle, Washington. In lieu of flowers, contributions can be made to the "William E. Donoghue Fund in memory of the great Blues Musician Sonny Boy Williamson II, aka Alex Rice Miller" at the B.B. King Museum and Delta Interpretative Center in Indianola, Mississippi."
