Data shows that women investors actually have a better track record than men. So, why aren’t more women investing, and why aren’t they investing more?  In this segment, Sallie Krawcheck of Ellevest discusses the gender investing gap.



The following is the full transcript of the conversation between Sallie Krawcheck, Founder and CEO of Ellevest and Denver Frederick, host of The Business of Giving on AM970 The Answer in New York City. This interview has been edited for clarity.

Denver: We have all read and heard about the gender pay gap that still exists in America in 2016–with full-time female workers making only 79 cents for every dollar earned by a man. But how many of us are aware of the gender investing gap and the severe financial consequences that can accrue for women who are investing less than their male counterparts?   Not many of us! And that is why it is such a pleasure to have with us this evening the founder and CEO of Ellevest, Sallie Krawcheck. She will explain why that gap exists and what she is doing to address it. Good evening, Sallie.  And welcome to The Business of Giving.

Sallie: Hi, Denver. It’s great to be here. Thank you so much for having me.

Denver: Let’s start with this gender investing gap. Data shows that women investors actually have a better track record than men. So, why aren’t more women investing, and why aren’t they investing more?

Sallie: Well, women tend to have a better track record in investing– when they invest– than men do, because they tend to take a longer-term perspective. They tend to trade less. They tend to shift in and out of stocks or mutual funds less often. Here are some other facts:  Women, girls and young ladies tend to be as good or better at math than boys, but you didn’t think that either…

Denver: I’ve seen the studies. It’s amazing!

Sallie: It is really interesting. I would say one of the reasons that women don’t invest to the same extent that men do, is because we still think of it in some ways as a male pursuit. We still have some of the 1957 Ozzie and Harriet — that this is the man’s way. Some of it is –Math — we’ve been told as women and girls that it is hard stuff. But some of it, Denver, comes from the industry itself–Wall Street and the investing industry. Think about it for a second. Turn on CNBC. Turn on Bloomberg. I love those channels. They are talking about beating the market, outperforming the market, picking the winner. Your adrenaline starts to go when the market opens in the morning. It’s like sports programming. So let’s think for a second–war analogies, sports analogies, sports programming. One more: the symbol of the industry is a–?

Denver: Bull…

Sallie: Bull…

Denver: Yeah! [laughter]

Sallie: The industry financial advisers, on average about 85% male, tends to be a more mature financial adviser — so I think in their 50s, really. For so many companies, in their 60s. In fact, there is one company that was telling me they had more financial advisers over the age of 80 than under the age of 30.

Denver: Wow.

Sallie: So it’s an older gentleman’s pursuit, and not too surprisingly, the client base tends to reflect the complexion of the advisers. So it’s guys doing business with guys.

Denver: Now that’s all very fascinating. I don’t think people fully appreciate the profound impact that language can have on our psyche…

Sallie: And symbols, right?

Denver: And symbols. You’re absolutely right! Do Wall Street brokers treat their female clients differently than their male clients?

Sallie: Great question! I’ve spent a lot of time on this. I’ve had the privilege of running Merrill Lynch Wealth Management. I was the CEO of Smith Barney, so I’ve been in this industry for years and years, and there are so many great advisers out there. And there are so many that do a terrific job for women. Not enough though. So typically, when you ask a financial adviser sitting with a couple:  Do you treat the man and woman differently? They say, “No!”

Denver: Of course not!

Sallie: No, no! And in fact, even when you put the men in sort of a room with the one way mirror and watch them and they leave, after the meeting you’ll say to them, “About what percentage of the time did you talk to the male versus the female?”  And they’ll say: “Well, you know what? Usually it’s 50/50, but this time it’s actually 55/45 cause we talked about the football game and blah, blah…

And then you say, “Actually, let’s go to the tape… It was 90/10 or 85/15.”  So the perception is — I got this! The reality is:  Women tell us, and I’d think I’ve done more research on this than anybody on the planet now…Women tell us that they do feel patronized. They do feel like they don’t have the time and the space to have their questions answered. And the result of this, Denver, is that in the industry today, a male client will leave his financial advisers–male financial advisers,if neither of them die– at a rate of less than 2% a year in the businesses I used to have responsibility for.  A female client will leave that same financial adviser in the year after her husband’s death– and he dies sooner as we know–  she lives longer.

Denver: That’s right.

Sallie: She will leave that same financial adviser 70% of the time…

Denver: Oh my!

Sallie: …over the next year. Not 17, 7-0. So something is not working here.

Denver: That’s right. I hate to say:  the same is true in philanthropy. The way fundraisers treat donors. They treat men completely differently than women. As a matter of fact, many of them have the default on their direct mail set up to read “Mister,” and it really rankles a lot of women.

Sallie: Yeah.

…it’s always something you can put off. But by the same little analysis: if a woman waits 10 years to invest, “I’m busy”, “I’ve got to do this”, “I can put it off”,  “I gotta find the right financial…” It costs her $100 a day. $100 a day! And if we had money falling out of her pocketbook at the rate of $100 a day, we’d change our pocketbook; we’d fix our pocketbook.


Denver: Well, tell us about Ellevest, what it’s about, and how you’re looking to better serve women!

Sallie: It’s interesting, because after I left Merrill, a number of people said to me, “Sallie, you should start an investing firm for women,” and I said, “Jump off a cliff, please! Go jump off a cliff right now!” If I’m gonna be open and honest, the industry’s women’s initiatives — and most of them have had them — have been about a glass of Chardonnay, have been about a canape, have been about talking about our emotions around investing. So, I sort of had that perspective for a period of time, “Okay, it’s going to be that.” And then over time, I began to recognize that this gender investing gap costs some women more than the gender pay gap.

In fact, to give you a quick number: if a woman is making $85,000 a year, putting aside 20% of her income, putting it in a bank, earning very little…Over the course of her life vs. investing, this can cost her $1.5 million, $2 million, $2.5 million. Life changing amounts.

Denver: Yeah, they don’t think it about it that way.

Sallie: No!

Denver: They absolutely don’t think about it…

Sallie: Because we don’t recognize the power of compounding.

Denver: Right.

Sallie: Because it’s always something you can put off. But by the same little analysis: if a woman waits 10 years to invest, “I’m busy”, “I’ve got to do this”, “I can put it off”,  “I gotta find the right financial…” It costs her $100 a day. $100 a day! And if we had money falling out of her pocketbook at the rate of $100 a day, we’d change our pocketbook; we’d fix our pocketbook.

Denver: For sure.

Sallie: Once I got over this…gender bias might be a strong word…but gender needs to be financial education. I said: ‘Wait a minute! What if we can make it smarter? What if for women, in this case, it’s not financial education, but proprietary investing algorithms, built by a chief investment officer– a PhD from Stanford, decades of experience. Beautiful, beautiful! Lead designer who led the redesign of, so brains meet beauty.

Denver: Yeah.

Sallie: And we take into account for women… their longer lives.. That matters for an investing plan…a lot!  The fact that sadly, our salaries tend to peak sooner than men…hate to hear that. That matters a lot for our investing platform. The fact that women tend to be more risk aware than men and  want to understand it…Okay, let’s build something…

Denver: That important distinction: It is not “risk averse,”  it’s “risk aware.”

Sallie: Bingo! That’s exactly right. Women want to understand what their downside can be. And downside is not standard deviation, as the industry tends to say or talk about it. But what are the chances I won’t reach my goals? And so what we’ve built is something that is not about “Hey, want a large cap value mutual fund versus a small cap growth ETF?”  Or “Would you like an alternative?” But instead speaks our language, which is “Hello, Susie.” She goes into an online platform that starts out: Give us some basic information: name, age, salary, assets. And then very importantly inquires: “What do you want to do?”

Oh, oh that’s different!

Denver: Yeah.

Sallie: I want to buy a house. I want to retire well. I want to have baby…

Denver: Your life goals.

Sallie: I want to start a business…

We calculate what you can afford–with really powerful technology– and then we provide a very simple 22 ETFs, but a pretty straightforward asset allocation and investment plan to get you there–by our calculations –get you there, or better, in 70% of markets. So that risk awareness–not a 100%!  Because that’s saving, not investing.

Denver: That’s exactly right.

For women, when you talk about money, to her…  it’s a pond. It’s a set amount. She husbands it, and it typically goes in one direction… which is down. So, that’s interesting, and I think that indicates why men tend to invest more wealth.  If he loses some, there’s more coming in. Whereas for women, it’s like “Ugh, I gotta keep this.


Sallie: And so here’s the final thing I’ll say, Denver, before we go on the next question. One of the reasons women also tell us they wait is because it takes so much time. It’s just going to take so much time. I was actually in Silicon Valley recently, and a pretty darn senior woman in the venture capital industry,  I was told, was gonna take a couple weeks off to figure out investing. We built this–again the power of technology– to take 15 minutes, 20 minutes. In some cases a lot shorter than doing laundry! And the last point I will make is that: you have to trust us in order to  do it.

Denver: Absolutely.

Sallie: And so it’s important to me that we are fiduciary– operating in our client’s best interest… required to do so.

Denver: Listening to you, Sallie, would it be fair to say that women look at money in a fundamentally different way than men?

Sallie: No doubt about it! So first, I want to start with the water analogy. When you speak to a man or a woman about money, they will use water visualizations. For men, it typically is a river. Money comes in; money goes out. The level rises; the level sinks. For women, when you talk about money, to her…  it’s a pond. It’s a set amount. She husbands it, and it typically goes in one direction… which is down. So, that’s interesting, and I think that indicates why men tend to invest more wealth.  If he loses some, there’s more coming in. Whereas for women, it’s like “Ugh, I gotta keep this.”

I’d say the other way that men and women think about it differently is that men do buy into what Wall Street is today–which is “I wanna beat the market, outperform this fund, that fund. Do you have that fund? I’ve got this money manager; let’s talk about it at the cocktail party” . And women tend to very much, very much think of money as a means to an end, not as an end in itself. It’s all about the house, so it’s all about leaving the legacy, it’s all about that kind of thing. Now, based on that, you might say, “Gosh ladies, just don’t invest. That’s fine, just don’t invest.” But the truth is, if you are a woman saving 10% of your income for retirement, and you put it in the bank account, your chances of retiring well–living on 90% of your pre-retirement income for your full life– is 0%.

Denver: Yeah. You’ve been big believer in technology for a long long time, but I don’t think a lot of our listeners really understand how a digital investment platform– or sometimes called a robo adviser– works. Will you tell us how it goes exactly?

Sallie: It’s the future! Where I think we are at Ellevest bringing smart, smart brains…again, I mention our Chief Investment Officer, who’s one of the smartest people (and is a woman) I’ve ever met. It took me more than a year to find her.  I wasn’t going to start this without…

Denver: The right person.

Sallie: …the smartest chief investment officer, who could be creative and so on. We also have partnered with Morningstar–they’ve got massive amount of data and intelligence around investing. And we’ve leveraged both of those with technology to build our proprietary planning and investing algorithms. Some people are going to say “Hey, I want a person.” In fact, so many people have told me a woman must have a person. Because of her…

Denver: Hand holding.

Sallie: …relationship focused, hand holding, etc. You know what? What we’re finding is that when she comes on to the site, chooses her goals…we invest her money for her to help her reach them. She doesn’t need a person;  she thinks she needs a person at the beginning.  But then she says:  “Wait a minute… you’re actually talking to me about things that are in my control”.

Do I want a house in five years or eight years? Do I want to retire at the age of 65 or 68.? Those I can control! You’re not throwing alpha at me, standard deviation, beta, large cap…And so it is an investing platform, like being at a Merrill, like being at a Schwab.  But we believe in a more user-friendly, interactive way, and I firmly believe this is the future. And as the industry moves increasingly to a fiduciary standard operating the best interest of their clients, you just gotta know technology is going to continue to rise.

Denver: Absolutely!

Sallie: Because a computer can have so much more in its brain that a human can…

Denver: We work better together…that’s the way it goes.

Sallie: So, this is the way of the world. That people are still going to be in this industry, there is no doubt about it. It’s not either/ or,  but technology is going to play an increasingly, increasingly, increasingly important role…

Denver: In every Industry.

Sallie: In every industry. And it’s good.

Denver: Absolutely! So you have created this customized plan for this woman based on her life goals. What happens if she falls behind on that plan?

Sallie: Great question. We tell her! I’m so glad you asked that, cause I forgot that super important part. In fact, that’s what tests the best because of women’s risk… You’ve done your research, Denver… Because of women’s risk awareness, what they want to know is….Look, I’m a grown up, I get it. Markets go up, markets go down. What I want you, Sallie, Ellevest, is to tell me is if I fall off track, what do I need to get back on track?

And so, it’s interesting because I’ve asked people all of the remember the markets were horrible back in January,…it’s now happily a faded memory.

Denver: That’s right.

Sallie: But I say to everyone, “Interesting, in January were you on or off track for your life goals?” And I haven’t had a single person tell me whether they knew if they were on or off track. They say they don’t know. We will reach out and say: “You’re off track. The market just cracked.  Even though we build a lot of bear markets into our forecast, maybe this one was more; maybe you didn’t make the monthly deposit you were supposed to make; maybe you changed your parameter for when you wanted to get to your goal. And we’ll reach out with an email and say, “You’re off track. Here are the things you can do to get back on track.” So very concrete. What we’re trying to do is cut out all that stuff in the middle, all that jargon, all that “going around the elbow to get to the ear” that can happen in investing.

Denver: Yeah, and I think a lot of people actually feel more comfortable in getting a notification that way rather than having to speak to somebody about it. They can look at it; they can think about it, and then they can respond as opposed to being put on the spot. So I think there are actually some benefits to this that people don’t appreciate…

Sallie: I think there are. All of this is on someone’s own time. So here’s the other thing, Denver, that really is interesting to me… I probably shouldn’t give it away — to our competitors because it’s a little bit of a surprise — is how much we’re seeing these women on the site at  9 o’clock at night, 10 o’clock at night, Sunday afternoon, Saturday morning.  None of these times are when the industry is open. Think about it. When do you have the time to sit back and say, “Okay, what do I want to do with my life”?  And we see them playing with their plans. “What if I buy the house later?” “What if I have the baby sooner?”

Denver: Yeah, absolutely! Everything in this world, Sallie, is on demand. We watch our TV on a demand, might as well have my investment coming to me on demand when I want it.

Sallie: You know it.

Denver: Speaking of competitors. There are many. There’s Betterment, Wealthfront… there are a lot of other people getting into these digital investment platforms. What do you see as Ellevest’s biggest competitive advantage?

Sallie: For women!  So, in a way, we have every competitor. You talk about the online ones…Wealthfront, Betterment.  But also you’ve got the traditional ones, and you have the ones that were cutting-edge for so many years–the Schwabs and the E-Trades, the Ameritrades, and Merrill Lynch, UBS. And then at the higher level, you’ve got the US Trust and the Citi… I mean, it’s everybody. And yet, it’s nobody. Because if you look at the data and see that the industry has really been serving men, nobody else is talking to this demographic in this way and building plans specifically for them.

I should say by the way, we do take gentlemen. What’s sort of interesting and depressing… or not depressing or whatever…is that when a gentleman comes through and says “I am man,” now he’s gotta look at the beautiful, Vogue-like website…

Denver: It’s gorgeous, by the way.

Sallie: Thank you! But when he comes through and he says “I’m a man,”  would you believe, we kill him sooner, and we’ll let him earn more. But anyway, no one has been speaking to building it for women and then speaking to women. Another place we speak to women, is the cost of a career break. So many women take a career break and they think about it incredibly incorrectly. So let’s go back to your example: You’re making $85,000 a year; you’re a woman; you take a career break. You think, “How much does that cost?”  So I can do the math; it’s$170,000.” The correct answer is:  It costs you more than $1 million! And the reason it costs you more than $1 million is because we’ve done the research into the salary cuts that women get when they come back after that kind of career break. It’s a substantial double digit percent. And then you get the raise off of those lower levels.

And by the way, at the same time when you’re out of the workforce, you’re not contributing on your 401K, so you don’t get that compounding  if you’re not contributing to your social security. So these are the conversations that we want to have with women. That’s not saying you shouldn’t take a career break…

Denver: Right.

Sallie: …what it is saying is make sure you understand the cost of it before you do it. So you’re making the decision with full information. I think there’s really an important space for us to occupy…

Denver: No question about that. I mean, there’s a lot of mumbo jumbo jargon in investing, whereas this is more about storytelling…really a narrative about your life and the role that money plays in it.  It really is so nice to follow.

Sallie: Thank you!

Denver: You are in the center of your money, as opposed to your money being over there. It’s all about what you want and things of that sort. I’m going to switch to a macro issue here. And I want to talk to you about the savings crisis in this county–which is probably best illustrated by the fact that 47% of Americans can’t pay for an unexpected $400 expense through savings or credit cards. Also, the retirement crisis–65-70 million Americans say they haven’t saved a dime for their retirement. You have made the point that we can address these issues more intelligently and more successfully, if we look at them as women’s crises.

Sallie: I know! I’ll tell you, Denver. This happened one morning when I was putting on my mascara. There is something about allowing the brain to relax, and you’re in a ritual …and all of a sudden you have an insight. And the insight I had was, “Oh my gosh, son of a gun!” The retirement savings crisis …that 13 trillion dollars savings gap that we have in this country, the one that is so intractable,and the solutions for which are so unattractive, i.e. tax increases,  entitlement cuts, that we’ve stopped talking about them… That crisis is, in fact, a women’s crisis.  Why is that? Well, women retire with two-thirds the money of men, gender pay gap, take time out of work, gender investing gap, and women live–pick your set of data–5 or 6 years longer than men. Any nursing home in the country is 80%+ females. And so, Denver, I’m really enjoying my time with you. I’m loving getting to know you. This is not your problem, you will be dead. I love my husband, I love my son, I love my brother, love men. But we need to open our eyes…to the fact that this will affect women.

Well, hold on a second!  If it’s a women’s crisis, the solutions start to shift. So, Denver, I then move to my next eye…the mascara is going on, and the wheels are turning in the brain and I say  “Son of a gun! The way to close this can actually be growth enhancing. What do I mean? Close the gender pay gap! You talked about it before…it’s 79 cents to a man’s $1. If you’re a woman of color, it’s substantially.

Denver: Much more pronounced. Absolutely right.

Sallie: …less, as in the fifties, and it’s terrible, terrible. But if we were to close that gender pay gap,…I later did research, we’ll close the retirement savings gap by a third.

Denver: That’s significant.

Sallie: At the same time, Wow! Wow! At the same time, this solution, rather than sucking economic growth away, actually puts money into the economy, right?

Denver: That’s right!

Sallie: So the women have more money. So, not only have  they got their social security going, they’ve  got the 401K going. But they’re spending some of it and making the economy go. That matters. The second thing, and I’m not a politician, how about mandated parental leave.? Oh, okay. Less than 20% of companies in this country have it. Most of them think about it as an expense. What’s the bigger expense? The bigger expense occurs if women have babies and don’t come back to work.

And there is recent research from KPMG that indicates that companies that put a mandated parental leave in place save money in the first year, FIRST YEAR. Because they don’t have to hire to replace the woman.

Denver: Which I think is 200% to 500%…that’s what the cost is to replace a skilled worker.

Sallie: Absolutely! Big big stuff. They think “She’ll come back. She’s a great worker, she’ll come back. ” Then she comes back for a couple of weeks. She’s exhausted; the baby isn’t sleeping; she’s a little concerned. She leaves.

If we keep those women in the workforce, contributing to social security, contributing to 401K, earning money, the economy grows.  And then finally, of course, the one that we’ve been talking about is the gender investing gap. Well, if women invest to the same extent that men do…I should sharpen my pencil on it… but that’s another big chunk. Another big chunk that gets us to close the retirement savings gap, and that’s good too!

Denver: That’s right!

Sallie: That’s good too!

Denver: Well, maybe you should become a politician.

Sallie: No, thank you! I’m good. But more investment drives more capital into the markets, which gives more growth capital for companies to grow. So all of a sudden, even though we never like to say anything is a gender issue because “What about the guys?  What about grandpa?  Grandpa’s got a problem too!”. I get it, I get it. But if we take this lens to it then, I think  there are some unconventional solutions to what has been viewed as an intractable problem.

Denver: For sure. We alluded to this in terms of some of your previous jobs, but you headed up two huge wealth management…

Sallie: Huuuggge…

Denver: HUGE! And despite a few ups and downs, you certainly are one of the most acclaimed and highly regarded investment professionals on all of Wall Street. So, becoming an entrepreneur at this juncture of your career is quite a pivot. Exhilarating at times, I’m sure. A few sleepless nights tossed in along the way. It started when you bought 85 Broads back in 2013. Has it been what you expected?  And has the transition been as easy as you thought it was going to be?

Sallie: No! I didn’t mean to do it. I honestly can’t believe I did it.  And with regards to Ellevest, I’ll tell you I wasn’t going to do it. As these people were saying:  you should start something Sallie, you should start something… No, no, no! Then I had this retirement savings crisis insight and I thought “Wow, there’s really an opportunity here… To do a great job and potentially build a great business.”

And you know what I did, Denver? I went and talked to my male CEO buddies, at the big banks, at the big Wall Street firms with the “You should do this. And I got plenty I can do.  I don’t need to do this, I’ll help you, I’ll help you for free. Like, let’s just go do this; let’s just make an impact.” And in one of the meetings — breakfast meeting — I was with the CEO where I was going through it all then I said, “Look, women do have money, and 90% manage their money on their own at some point in  their lives and…”

Denver: That’s a heck of a statistic.

Sallie: And I’m going through it, and I finished my pitch to him.  He turns back to me and says, “That is so interesting, Sallie, and maybe we’re really going to think about that. But don’t their husbands manage their money for them?” and I said “Darn it, he can’t hear me”. He can’t..

Denver: Yeah. Yeah, not getting through.

Sallie: …hear me. In fact the industry call women a niche.

Denver: That’s right.

Sallie: And frankly it is for the industry, so that’s fine. But it was only when I saw this problem, I saw what I believe to be a solution. I tried more conventional ways of approaching it… had the door slammed at me. That I have to tell you, Denver, my perspective on this is I have been so UNBELIEVABLY fortunate in my life. I cannot believe I got to run Smith Barney. I cannot believe I got to run Merrill. I cannot believe this stuff.

Denver: As a journalism major, no less.

Sallie: As a journalism and poli-sci major. I looked back on this and say, “How did I get so lucky?” And of course it goes back to I had terrific parents who really invested in our education. But it could have been so different. I could have been born in a slum in India. I could have been born to parents who didn’t invest the time in me. And so I’ll tell you the truth, once I saw problem/ opportunity, I’m the one to do it!  I mean, name another senior woman on Wall Street. Okay, fine you can’t. I’ve got this unique perspective, I have this unique background…

Denver: It’s almost a duty in some ways.

Sallie: That’s exactly what it is. And for the first time in my life, I’m doing exactly what I’m supposed to be doing, and exactly what I think I was put on this earth to do, quite frankly. So, is it scary? It’s terrifying!

Couple of sleepless nights, Denver? I mean, lots of sleepless nights!  And the potential for failure is high.  And it’s even worse because I’ve got outside investors who have funded the company. And I saw one of them, and I said, “We’re working so hard for you! We’re working so hard for you!” And she said, “Sallie, take it down six notches. I’m a grown up. If you’ll lose it all, you lose it all.”

But there’s a sense of a responsibility.

Denver: I want to pick up on one of your female investors and the theme that you just mentioned.  Andrea Jung was on the show just last month.

And she is the President of Grameen America. What they do is provide microloans to women in poverty to start businesses. And although Grameen is a non-profit organization –and Ellevest is a for profit–I was really struck, Sallie, about how similar your two organizations are. Because when Andrea was on the show, she talked about the importance of becoming self-sustainable,  that she did not want to become overly dependent on philanthropy. And looking at you, although you’re a for profit, your social mission is just as strong as hers, and you’re both trying to do the same thing.

Sallie: Right.

Denver: You’re trying to empower women and help them become more financially independent, albeit maybe at different income levels along the spectrum. Tell us how you think about the social mission of Ellevest, as well as your decision to become a B certified corporation?

Sallie: Well, to be clear. Ellevate Network is the B.

Denver: Yeah, right.

Sallie: So, I’ll tell you, I love what’s going on these days with these powerful women who are really working to make a difference.. and in some cases in chapter two or three of their careers, Andrea is doing it. I love the way Sheryl Sandberg took her platform at Facebook and has brought attention to professional women and the advancement of them and how it helps businesses. I’m seeing it again and again.

Denver: All over.

Sallie: Women really beginning to support other women. And I’ve  got to tell you, Denver, back in the day, in my Wall Street days, and no likes this when I say it: There were a lot of “queen bees”…and I’ve got my little quote marks. There are “queen bees” who really intuitively understood that there was only going to be one or two senior women in the room. If they were one of them, and they weren’t ready to give up the seat, they would kick that ladder out from underneath others, and it actually…

Denver: You know that first hand, don’t you?

Sallie: Whoa, honey, I got queen bee’d. It was a little like middle school quite frankly. So I’ve had it happen to me; a lot of women have had it happen to them. And this generation of more mature women, and then the younger women are like, “Hell no! Not going to buy it anymore”.

And we’ve built these careers.  We’re at stages of our lives where we’re gonna help other women, both by mentoring younger women– by investing in businesses of other women as Andrea has done with Ellevest, by really providing the support network. I actually start to think there’s a group of women who have been through the wars, who’ve been in senior corporate positions across this country. There’s almost a silent network in which we help each other when it’s time.

Denver: That’s great.

Sallie: So I really love what’s happening. Now, in terms of the B corp, Ellevate Network, which you mentioned, is the old 85 Broads renamed. It’s a global professional women’s network, is a business that I bought a handful of years ago, is now a B corp. Look, when I bought it, people who said it’s a non-profit, the business I bought was an LLC, so there you have it. And if you convert to a non-profit, you’ll lose your investment. So, B corp just made all the sense in the world for us. So the business today is based on the premise that professional women coming together and  sharing ideas, thoughts, tips, advice, opportunities, networking, is the number one unwritten rule of success in business. It  advances them, but is good for business. I hope I don’t have to go into– or I won’t go into– all of the research that says more women in management roles is good for everyone and the company. And so my thinking was, look I’ve got an LLC, but this is going to have a positive impact on business…a positive impact on family, a positive impact on society. This is a B corp. So the way that we’re running it is as close to break even as we possibly can. Put everything back into the mission. We are out there trying to make a difference..

Denver: That’s great. You know one of the great aspects of starting an enterprise like this, at least it would be for me, is the opportunity to create a work culture where everybody wants to come to work in the morning, where you can attract the best talent, where you can retain the best of talent,  and also maybe to create something which is a little bit different from some of the corporate cultures that you came from. What kind of culture are you trying to build at Ellevest, Sallie?

Sallie: What a great question. All about the mission, all about the mission, and all about open, frank discussion and respectful debate. I knew that we had this right when our lead designers such as Melissa Collins…(What an enormously talented woman! And so important in the usability and the aesthetics of Ellevest!)… when we were interviewing her, she said she got chills. I said, “Done! This is exactly what we want to do! ” It enabled us not only to bring in someone like her, but our head product manager is from Weight Watchers, so that’s a great

perspective. We’re working on being an enormously diverse group of individuals and diverse in every way.

Denver: Every way, right!

Sallie: Every way. Because if someone is exactly the same as the person sitting next to him, hey, you don’t need two of them! You have to have people who bring things to the party.

Denver: You only need one pair of scissors. Sometimes we build companies with about 12 pairs of scissors in the center drawer… doesn’t make any sense!

Sallie: We don’t need five point guards. A point guard’s the most important player on a team, I would argue. But five of them, you have chaos. And so, we’re trying to find this important balance between:  Everybody knows their job and their responsibility, and this is what I do. But everybody also cares, and so is in each other’s hair and is collaborating to a degree I haven’t seen any place else.

Denver: Well, I’ve seen your work space. It was done by Homepolish. It’s quite open, and it just lends itself to a collaborative atmosphere.  I really liked it.

Sallie: Yeah, it’s a lot of fun and for me. I used to have 2 assistants in front of my office so you couldn’t get it at my office. I mean it’s, it’s fascinating and so invigorating to go from that…

Denver: It really empowers when people can walk into your office and……

Sallie: Honey, I am in the middle of the room with everybody. My poor Chief Product Manager, we’re at the same desk staring at each other all day. So that woman sees more of me than she does of her husband.

Denver: I’m going to get you out on two final questions, and both have to do with procrastination. So I’ll start with the first:  Let’s say you’re a woman whose husband or partner is pretty much in full control of the finances. They listen to you, and they want to get more fully engaged and informed. Of course that’s going to necessitate, let’s say, “ the conversation.”  And you know those conversations can be put off and put off until the right time– which never comes. What advice would you have for someone in that situation?

Sallie: Just do it. Set up a time, “x” number of days from now, and you just have to do it.  And you will know your partner better than I do. Some partners: “You’re right, Honey, let’s do this,

I’m so glad, I feel…” Some partners will need to be reminded of some of the facts about longevity and his or her responsibility to the other partner– if he or she is not there.

Some will need examples and sadly, as we all get older…we’ve got the examples, and I have so many of them. The husband who committed suicide and left the wife penniless. A college friend of mine, I mean, shocking, right? The husband who died in a car accident and left the wife without knowing where the key to the file cabinet was.

Denver: Happens a lot…..

Sallie: And the only thing I would say is: It’s easy to sort of put that off, it’s easy to say, “You know what?  He’s healthy. It’ not gonna happen to me.” or “He’s not gonna cheat on me.”, Though, for years, Denver, I would walk around and say “Look, I never thought my first husband would cheat on me either, but he did. I was so in love with him. If it could happen to me, it can happen to you.” And I never made any progress with that argument.  But now I’m trying a new argument, which is “Jay-Z cheated on Beyoncé!”  But the numbers are that a little bit less than 50% of marriages end in divorce. Men die sooner than the women. You just have to do it, and whatever way you have figured out over the years to get your spouse to talk about something…whether you’ve got to get them a glass of wine.

Denver: Yeah, yeah!

Sallie: Right? You need to give them a kick in the pants, whatever it is…

Denver: Set the time, and get it done.

Sallie: You have to do it, and you’ve got to know what the assets are, where the assets are. And begin to ask those questions about investing.

The one thing you hit on that I do want to address is this idea– and I’ve started to hear it from women– “But the market is expensive. So I’m gonna wait.” Okay, okay, are you Warren Buffett? Because he is the smartest investor probably in the history of the world, and he doesn’t even know…

Denver: Second one: For a woman who is in control of her finances, but is under invested. I think women have an average of about 70% of their money in cash. And she intends to invest, and as you alluded to before, after things slow down at work. Or maybe after the next correction.  You know that list. So let’s say she wants to get started.  Probably a great way to do this is to visit the Ellevest site. But that sometimes can be too open-ended, so I’m gonna ask you to sort of walk us through what occurs when somebody comes to your site. How do they get a toe in the water?  How do they get a little more acclimated?  How do they ramp up before they get fully involved and fully engaged?

Sallie: First of all, if a woman needs a kick in the pants to get started. I talked earlier about if a woman is making $85,000 a year, she’s putting 20% of it into the bank. She waits 10 years to invest, which we’re seeing again and again and again, that costs her $100 a day. So what I would probably do in order to encourage myself is take a $100 a day and throw it away into the waste paper basket. Maybe burn it… Burn it and then after few days maybe you’ll feel the need to get started. The one thing you hit on that I do want to address is this idea– and I’ve started to hear it from women– “But the market is expensive. So I’m gonna wait.” Okay, okay, are you Warren Buffett? Because he is the smartest investor probably in the history of the world, and he doesn’t even know…

Denver: Nobody knows.

Sallie: …and we’ll say “Right, because nobody knows. I mean with all due respect, lady, do you really think you know?”. But in a way that misses the point, because the right way to invest–in a way we encourage at Ellevest is–if you have a lump sum to put in, fine, put it in.  But invest regularly. The way to do it is if you start with 1% of your income, or start with 5% of your salary, or 10%.  Work on up, but do it every paycheck, every month. And what that means is that sometimes you will be right. “Yep, the market was high. Told you.” Other times you’ll be buying low when you don’t know it, but it will even out over time, and you will therefore get market-like returns which are so much better than everybody else does!  So I would say, “Throw away the money; give yourself a kick in the pants.” And then what I want your listeners to do, all of them, is I want them to go to the Ellevest site.

Denver: Which is?

Sallie: Which is So they’re gonna have to sign up. We’re still bringing in people in batches, so they have to sign up. We’ll get to them very quickly, within a couple of weeks.  They’ll be on the site and engaged. And I want every one of them to put together a financial plan.  Those, we provide for free. We don’t do the investing for you for free. But we provide these financial plans– which  in the places I worked before were $1,000, $250, depending on the plan. I think it’s the most sophisticated plan out there. We have patents pending on it.

Put together a plan, that’s all. Because what you’re doing by doing that is increasing your chances of achieving your big goals in life. Then of course, if we invest for you to get there –as mentioned earlier–we shoot for getting there or better in the majority of markets, 70% of markets. So just take that first step, and I think what you’ll see is you’ll begin to get some clarity.

Denver: Yeah.

Sallie: Oh, you know what? I cannot, I mean, we get bad news. I can’t buy the house, have the kids, start a business, retire well, build the emergency fund, take the trip around. Can’t do it all. So, you start to make those trade-offs and see what you can really do.

Denver: No minimum amount to invest.

Sallie: This was so important to us. Almost everybody else has a minimum, and obviously we lose money when it’s small amounts of money. But it was important to me to make this…

Denver: Part of that social mission.

Sallie: …approachable. Make it approachable for women because the industry has been so unapproachable for women.

Denver: Well. Sallie Krawcheck, the founder and CEO of Ellevest. I want to thank you so much for being here this evening. This is more that just a start-up; it really is an effort to change the culture around money and Wall Street.  And I have a very good sense that you’re going to be successful in doing so. It was a real pleasure to have you on the show.

Sallie: Denver, thanks so much for having me. Have a nice evening!



Sallie Krawcheck, CEO and Founder  of Ellevest and Denver Frederick, host of The Business of Giving

*The Business of Giving can be heard every Sunday evening between 6:00 PM and 7:00 PM Eastern on AM 970 The Answer in New York and on iHeartRadio. You can follow us @BizofGive on Twitter and at


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