When she started on Wall Street in the 1980s, it was a much different environment than today's post-"Me Too" world, said Sally Krawcheck, the CEO and co-founder of Ellevest, an investment firm and network for professional women.
Obscene, threatening notes were often left for her to find on her desk.
“It was, ‘You don't belong here and we don't want you,’” she said. “Which made me all the more determined to stay in the industry and find some level of success.”
As one of few women working in the era of male-dominated, ego-driven Wall Street brokerage firms, “I had to be pretty intentional about how I navigated through the industry,” she said. But navigate she did, rising from equity analyst to head of research at Sanford Bernstein, and eventually leading wealth management businesses at Citigroup and Merrill Lynch.
In 2016, Krawcheck launched Ellevest, an online investment platform aimed at addressing the gender investing gap among women.
During eMoney’s annual virtual summit, Krawcheck said the legacy of misogyny in financial services means women still aren't always comfortable around discussions of money and investments, even as they control more than half the wealth in the United States. A financial advisor who understands the perspective will be valued, she said.
“Money can be a stress for women today, but when they work with a financial advisor, that source of stress turns quickly into a source of strength,” she said. “Money does buy happiness. It buys the ability to leave a terrible relationship. It buys the ability to leave a terrible job. Or buy the home you always wanted.”
Krawcheck said there were five main lessons she had learned over the years in business.
The first was to embrace the power of diversity. She said she learned this during her time at Citigroup during the subprime mortgage crisis.
“There was, at the company, a lack of diversity of experience, which in turn led to groupthink,” she said. “This also was a team that not only had grown up together but had many of the same characteristics. Certainly educational, but they were white men of a certain era.”
Krawcheck said she has seen value in “the clash of ideas that leads to innovation,” which leads to greater employee and client engagement.
“Diversity has been shown to outperform meritocracy,” she said.
The second lesson, Krawcheck said, was surrounding herself with a “personal board of directors” to help her make hard, important decisions in her life. In turn, she said she tries to be there for others, especially when they may be going through a difficult transition, like a job change.
Third, Krawcheck said successful leaders look for the “white space” in their companies or industries, and do what others don’t. She said this spirit of seeking out opportunities was one of the catalysts for forming Ellevest. She said it was a challenge to overcome the assumptions that women were risk-averse and didn’t want to think about investing.
“The women's initiatives at the big banks I was a part of were marketing campaigns,” she said. “There was a point of view that whatever we were doing in the industry, it's just something about women and they're not partaking of this terrific offer. I bought into that for a while. Let's challenge the assumptions about women.”
Krawcheck said those perspectives, along with the rampant use of jargon, kept women away.
“This is an industry that has traditionally centered on men,” she said. “Ellevest centers women.”
Fourth, Krawcheck said you should not “fight the Fed,” or work against overarching shifts in the industry, like those brought by artificial intelligence or the growing impulse of younger clients towards impact investing.
“Every time you try to fight the Fed, you lose. You can make a great living out of just not fighting the Fed,” she said. “Going up an up escalator is so much easier than trying to go up a down escalator.”
Finally, Krawcheck said treating people well “and being as kind as you can afford to be” were key attributes.
“We're not running families, we're running businesses,” she said. “I'm not saying there aren't difficult decisions to be made, but the cultures that we build and promote as leaders make a big difference.”