American Century Founder Stowers Dies at Age 90
James Evans "Jim" Stowers Jr., who founded Kansas City, Mo.-based American Century Investments and helped build it into the large global asset-management shop that it is today before turning his gaze toward major philanthropic endeavors, died on Monday, March 17 of natural causes at age 90.
Armed with $100,000 in seed money from 24 investors, Stowers created the forerunner to American Century in 1958, starting out with two mutual funds. Within a short time, Stowers became known not just for his growing firm but also for his philosophies underpinning how the firm managed its clients' equity assets. Under Stowers' leadership, his firm adopted the mind-set that "money follows earnings," gravitating toward firms experiencing rapid sales and revenue growth.
Stowers also was an early adopter of technology, using computers in the early 1970s to streamline his stock analysis process and writing a program to identify companies with the most desirable growth characteristics.
Born in Kansas City, Mo., Stowers originally set out to be a doctor like his father and grandfather, and earned bachelor's and medical degrees at the University of Missouri. In the mid-1950s, however, he shifted gears, selling mutual funds at Kansas-based Waddell & Reed (WDR) and then running his own term life insurance firm, J.E. Stowers and Company.
In 1958, Stowers made his move, founding American Century in his one-bedroom apartment in Kansas City under the moniker Twentieth Century Mutual Funds. (The firm was renamed American Century Investments in 2000 and currently has a Morningstar Parent rating of Neutral.) In the 1970s and 1980s, the firm's computer-assisted stock selection process drew assets and made Stowers something of a well-known figure in the investment-management industry.
By the 1990s, Stowers had expanded the firm's focus beyond domestic growth stocks to other investment disciplines like fixed income, global equity, value equity, asset allocation, and quantitative investments.
Although Stowers stepped down as the firm's chief executive officer several decades ago, he remained co-chairman of the board up until 2010, when he suffered a bad fall and gave up that role. Stowers remained on American Century's board as a director until his death.
In 1987, Stowers was diagnosed and treated for prostate cancer, and his wife, Virginia, had surgery for breast cancer in 1993. That prompted the couple to found the Stowers Institute for Medical Research in 1994. Across three ownership transfers, the couple eventually transferred their more than 40% ownership stake in the firm to the institute. (The firm's remaining ownership is made up of a 41% ownership stake by CIBC and about 13% to 14% ownership by its employees.)
Today, in addition to being a large owner of American Century Investments, the institute operates a 10-acre, 600,000-square-foot research facility and houses 22 independent research programs and three technology development programs. In 2010, Stowers and his wife signed the "Giving Pledge" championed by Warren Buffett and Bill and Melinda Gates that challenges wealthy individuals to donate more than 50% of their wealth to charity. For the couple, such a pledge was a formality, as they already had transferred the majority of their wealth to the endowment for the Stowers Institute.
The Stowerses were ranked ninth on Forbes magazine's 2011 list of "Biggest Givers," which spotlighted those who have donated at least $1 billion to charities and foundations. The article noted that the couple had pledged the most as a percentage of their total net worth.
In addition to his wife, Stowers is survived by three adult children, six grandchildren, and a brother.
Robert Goldsborough does not own shares in any of the securities mentioned above.
