By Axel Steinmetz

When working in Germany over the summer, I was exposed to a lot of the excitement surrounding the millennial driven “employee engagement hype” that swept across Silicon Valley and is now finding a foothold in some of the world’s largest organizations. I was working at a startup named Honestly, which provides third party SaaS solutions to big companies trying to measure how much their employees like their work, and how the company can be better. In theory, increasing employee happiness will increase productivity, and happy employees is a good thing by all measures.

Unsurprisingly, a startup which focuses on employee engagement is going to have an excellent workplace culture themselves. Working there never felt like work to me despite the solid amount of work I actually accomplished looking back on it. I also was able to learn a great amount without ever feeling like I was learning, at least in the traditional textbook sense.

Now I’m back in the “real world” with a club that I’m trying to improve the engagement in. For the most part, attendance in VVI is pretty good. Most people show up for fund meetings and educational ones, the turnout at the few social events we put on is pretty good as well.

But engagement is different than attendance. I would hardly say that someone on their computer doing other work at a club meeting is engaged even though their body is physically present. And sure, no laptop policies can help solve the issue on the surface, but students can still be spacing off and not be engaged. My goal is to do better. I want everything we do to be so worth it in the minds of all my members that the VVI meetings are the best part of their week. Idealistic goals don’t always have to be achievable for them to serve a purpose.

That being said, engagement in the club is still pretty good overall. People are always asking good questions at meetings, putting lots of good and honest work into the pitches, and having fun at social events. All of that is accurately reflected in VVI’s reputation on campus as well. One of my board members told me that VVI has the reputation of being one of the more “chill” investment clubs, which I think may just be a function of other clubs being more try-hard than we are — and not in a bad way either. But to go back to the engagement question, there are some members of VVI who don’t show up to meetings repeatedly, coast by on the group work by riding off the tailwinds of others hard work, and are most likely in the club just for their resumé. To me, that’s a pretty stupid reason to be in a club, but I guarantee there are people who do it in every pre-professional club, and I want to do better to minimize that behavior in my own club.

Trying to recreate the environment I was in at Honestly is impossible for a club, but I’ve been experimenting with how to increase VVI engagement for a year now, and I’d like to use this blog post to expand on some of my thoughts–what works, what doesn’t work, other things I’d like to try, that sort of stuff.

First, some context. VVI is an undergraduate investment club. No one gets a salary, and even being in the organization is entirely voluntary. Thus in some ways, getting people to show up for stuff is half the battle. Everyone in the club is an undergraduate student, and of course everyone in the club is going to prioritize school over VVI, and that includes myself. There are some weeks when I dedicate more time to VVI than school depending on what needs to get done, but for the most part I dedicate most of my waking hours to school just as any college student probably should. There are some steps we can take to ensure reasonable attendance: fining people who miss a certain number of meetings without telling us, forcing people into speaking roles at meetings so they have to show up to do their part, that kind of stuff. But, that’s not nearly as important as making the meetings themselves worthwhile, so people actually want to show up and not need any extra motivation. Then of course, the question becomes, “Well how do we do that?”

It’s hard to make investment research exciting to undergraduates. Most of our members view the club as a pre-professional organization. That’s what we are, of course, but what I mean by that is that people join VVI for their future job. Not many of our members are picking up annuals because their fun reads or anything like that, and our members are in the club to learn some finance and get some practice researching companies.

I’m also on the school’s Sailing Team, and engagement is really easy for the team, not because practice is mandatory or anything like that, but because people are on the team because they want to sail! If you’re a member of “Trombone Club,” you’re only going to be in that club because you appreciate the trombone. No one is looking to join Trombone Club just to put Trombone Club on their resume. Contrasting Sailing/Trombone Club with VVI, people are in VVI because they believe at some level that joining a club like ours will be good for getting a job or whatever. Doesn’t make the work any more exciting for some people in any respect, and that’s part of the reason why I have to worry about engagement in the first place.

What Doesn’t Work

  1. I find providing food to be largely ineffective in increasing engagement. In the old days of VVI a year and a half ago, I used to bring pizza to all the members. While those who did show up to meetings generally liked the pizza, it was expensive (~$30 / meeting), and largely distracting. Also, it did nothing to keep people engaged in the club. My two roommates who joined and then dropped VVI were never going to stay in the club. They weren’t interested in investing, still aren’t, and nothing I could’ve done was going to change that.
  2. Another thing I found to be ineffective is assigning summer work. No one does it basically. When I’m in front of someone and I tell them to do something, it’ll probably get done. But if I give summer work for people to do, there’s not much incentive for people to actually go out and do it if their not interested in learning about investing on their own. Some kids will inevitably look at any given book recommendation I give and read the thing, but I don’t have that kind of authority, or “clout” as us kids say nowadays. Therefore, the kids we recruit will at least partly determine how engaged club members are.

What Does Work

  1. Recruiting plays a role in engagement obviously. Kids we get who are already interested in investing are probably going to be more engaged in the club. They may even read an investing book over the summer. To an extent, I can get a kid who wasn’t previously interested in investing to at least appreciate the art of it all, but a far more likely scenario me getting an investing kid to like value investing more. Then there are some kids who were never exposed to investing before joining the club, and some of them I believe have actually found their passion. That’s a great thing! Engagement isn’t a problem for them.
  2. The branding and reputation of the club is also important to engagement. Everyone wants to feel like their organization is improving. Good marketing helps, as does actually building a good organization so that you get some positive word of mouth traction as well. I’m not reporting anything profound here, but the point I want to get across is that establishing a sense of a community under one brand helps unite people and increases engagement in the club.
  3. Feeling like you’re good at the work you do is another variable in the engagement question. The premise is pretty obvious: people will like their work more and work harder if they feel like they know what their doing. Otherwise, people will feel lost and confused, and will produce bad work. Malcolm Gladwell’s 10,000 hour rule is a famous example of the importance of mastery, but you don’t need 10,000 hours to reach a threshold level of knowledge where you feel like you’re getting the hang of it. There’s a quote by author Johann Hari that I’d like to include here. He says, “Mastery is when you feel like you’re good at something. That is absolutely an underlying psychological need. Everyone needs to feel like they’re good at something. If you don’t have a sense of mastery in your life you’re much more likely to be depressed and anxious.” With that being said, I still wouldn’t advocate for learning investing as a secret to alleviate depression and anxiety. The market is too ruthless for that.

Within my club, the level of financial education members have is a factor of how well we teach them, assuming no outside knowledge. As such, we have to place an enormous importance on education if we actually want good stock ideas. This past semester, everyone’s pitch could have been better, including my own. Who else do I have to blame for that besides myself?

The problem is that learning investing from scratch isn’t easy. It requires all these building blocks that add up to knowing “investing” whatever that means. There’s no way around learning accounting and some basic valuation stuff at the very least, and a deep understanding of both of those doesn’t even make you a good investor. You could still make bad assumptions, spend your time focusing on the wrong things, or do everything right and the market may still punish you. Good value investing typically requires more research than other types of investing too, so you ideally need to do everything right and know everything if you want to succeed.

Now as a club, that’s a pretty daunting task. On the one hand, we’re a student organization trying to teach our members a skill that people spend their lives learning, sometimes still unsuccessfully. On the other hand, we need well educated members to provide some real value as a club, and of course to get ideas through the research members do. We just have to do the best we can and constantly provide feedback on where people can improve.

That feedback part is really important because it goes both ways. By finding out what I need to do differently, I can see where I need to improve. I don’t have all the answers for how to run a club, and no one on the board does. But we can’t make the club better by thinking that we know what’s best for everyone.

Over the summer we sent out a feedback form for all members to fill out, and the results we got were a little surprising to me. I was expecting people to rip apart our education strategy, our portfolio holdings, or the way we run club meetings. Turns out, members wanted more of just two main things: professional development and feedback itself. Thus, we’re making our professional development efforts more formal by building lectures for all members and hosting workshops for members to teach each other. As for the feedback portion, the board’s feedback on the research pitches groups gave was minimal, and I and the rest of the board will need to do better. We’ll be giving more feedback on where to improve, what questions were left unanswered, and what we think about the company. Again this is all pretty obvious stuff, but my hope is that by making these changes, engagement will go up.

In sum, VVI engagement is something that can be improved. I have little doubt that we’ll get there, but we’re not there yet and I think it’s holding us back. On the bright side, there are so many amazing members who have helped the club so much, and the club only gets better when they do so. I’m pretty much dispensable at this point, and that’s a great feeling. The goals I expressed in this post are only one person’s ideas for how to make the club a better place, and my ideas probably aren’t even all that good compared to what other members could come up with. I look forward to this next semester as I have full faith we’ll only get better.

Victors Value Investments

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Victors Value Investments (VVI) is the undergraduate investment club at The University of Michigan.

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