A school with an endowment typically got/gets that money from alumni (graduates). If the alumni are able to fund a large endowment then that indicates they have been successful. When a large number of alumni are able to make 6-figure donations to their alma mater, there’s an indication that “people who graduate from here make a lot of money” and that’s just one consideration in the rankings.

The same colleges are almost always at the top. It’s a function of the way reputation works. Until something significant happens to damage the reputation of one of these schools, they will tend to remain on top. Those schools lower can only move up the ladder if something happens to significantly enhance their reputation.

It is not just the endowment size, there are many factors. But many people believe the rankings are flawed. Much depends on what you exactly want out of a college – the rankings are based on some factors that some people consider unimportant while they don’t include other factors that some people think are important. Bottom line, rankings are just a guide.

There are lots of factors that affect the rankings. It costs money to improve in any of those areas — so the endowment becomes highly correlated with the factors that affect rankings.