Federated co-founder, money fund pioneer dies
John F. “Jack” Donahue, a mutual fund industry innovator and staunch supporter of Catholic education in Pittsburgh and around the nation, died at his Naples, Fla., home Thursday. He was 92.
Mr. Donahue, a United States Military Academy graduate and former pilot for the Strategic Air Command, founded Federated Investors in 1955 with Central Catholic High School classmates Richard B. Fisher and the late Thomas J. Donnelly.
The Downtown firm pioneered offerings of money market mutual funds and today manages $362 billion from offices in the United States, Canada, Latin America, Great Britain, Ireland, Germany and Asia.
“My father was a remarkable business leader and a man of tremendous faith who dedicated his life to building Federated and his community,” Federated president and CEO J. Christopher Donahue said in a statement released by the company.
Federated’s statement said Mr. Donahue began selling mutual funds in 1950 after leaving the Air Force and completing a stock market correspondence course offered by Forbes magazine. He started Federated five years later with his
high school colleagues, figuring he could do better starting his own venture.
Federated began offering money market mutual funds in the 1970s as a way for banks and other institutional investors to manage their cashmore effectively. The innovation spurred growth that attracted the attention of Aetna Life & Casualty, which acquired Federated in 1982for about $256 million.
Federated’s managers bought controlling interest in the company back in 1989, with Aetna retaining a 25 percents take that Federated subsequently bought out in 1996. Federated became a publicly traded company in 1998 and today has a market value of $2.6 billion.
As considerable as Mr. Donahue’s accomplishments were in the business world, many believe the Stanton Heights native made a bigger mark by serving as a role model for his large family and other followers of the Catholic faith. Donahue family members often cite the large clan’s guiding principles: faith, family and Federated, in that order.
Bishop David Zubik of the Diocese of Pittsburgh said Mr. Donahue “allowed his life of faith to shape his family and guide his professional success.”
“Jack understood his goal in life was to get to heaven and he inspired others to get there as well with his generous heart,” the bishop said in a statement.
Cardinal Donald Wuerl — archbishop of Washington, D.C., and former bishop of the Pittsburgh Diocese — said Mr. Donahue “touched a wide range of people who were in no way connected with finances.” Cardinal Wuerl first met Mr. Donahue in 1965 when he was a seminarian for then-Bishop John J. Wright, a friend of Mr. Donahue’s. He said one of Mr. Donahue’s most endearing traits was his humility.
“He was not someone who wanted his name on things. He wasn’t someone who wanted people to know the things he was doing,” Cardinal Wuerl said. “He had a very simple philosophy of life: We’re supposed to take care of one another and as we do that we work our way to God.”
One of Mr. Donahue’s favorite causes was supporting Catholic education, including Duquesne University’s John F. Donahue Graduate School of Business; Central and Oakland Catholic high schools; and the Diocese of Pittsburgh.
He created the Golden Apple awards to honor the best Catholic school teachers in Pittsburgh, an award that later become national. He also played a major role in founding the Extra Mile Education Foundation, which supports Catholic education for inner-city children.
Mr. Donahue is survived by his wife of 70 years, Rhodora Jacob Donahue; 13 children; 84 grandchildren; 109 great-grandchildren; and two sisters.
A funeral Mass is scheduled for May 20 at St. Ann Catholic Church in Naples.
In Pittsburgh, visitation will be held at Freyvogel Funeral Home, 4900 Centre Ave., on May 23 from 2 to 4 p.m. and 6 to 8 p.m. Cardinal Wuerl and Bishop Zubik will celebrate a memorial Mass May 24 at St. Paul Cathedral in Oakland.
The family suggests memorial contributions can be made to Central Catholic http://www.centralcatholichs. or the Little Sisters of the Poor http://www.littlesistersofthepoorpittsburgh.
“My father was a remarkable business leader and a man of tremendous faith who dedicated his life to building Federated and his community,” — J. Christopher Donahue, Federated president and CEO