How I Got Over Myself….and Raised a $10 Million Series A
Last week was a big one for me. My team and I announced a $10 million Series A funding for Ellevest, a digital investment platform focused on women. This financing marks one key step forward, with about a zillion more key steps ahead.
Why are we doing this, I’ve been asked? After all, financial services and fintech are considered very crowded spaces. Very, very crowded spaces.
It’s because we see the opportunity to impact an issue that really matters.
I’ve written before about my ah-ha moment that the retirement savings crisis (which by some estimates is $13 trillion+ in size….if Social Security is solvent…which it’s not) is also a women’s crisis. To get to that ah-ha, simply walk through any nursing home and you’ll see a population that’s 80%+ females.
Once you look at this crisis through the lens of gender, the possible range of solutions change, from all bad (think huge tax increases and massive wealth transfers) to potentially-economic-growth-enhancing (think closing the gender pay gap and keeping women in the workforce longer).
Another way to make a dent in this problem is to close another gender gap: the gender investing gap.
Despite controlling more money than we ever have ($5 trillion in the US and growing….and that’s control, not jointly control), we women don’t invest it to nearly the same extent that men do. And this hurts us.
Now, I have to tell you: for a long time I fought the concept that women needed a “different” investing experience than men; after all, there are thousands and thousand and thousands of mutual funds out there.
But here’s what I now think: there are gender differences that should be taken into account in investing, such as that we live longer than men, we tend to have more discontinuous careers than men (which can have a HUGE impact on reaching our financial goals), and we are more risk aware than men.
And here’s what I now know: when asked, women say that their needs are not being met by Wall Street; sure, women say, Wall Street as an industry markets to us, but it doesn’t serve us. And the further proof is in the results: how else to explain that — while the Financial Advisors at firms like Merrill Lynch lose less than 2% of their core clients in any given year — when “he” dies, “she” (his widow) leaves that Financial Advisor at a rate of 70%+ over the next year? (No, not a typo.)
What I also know: given my background, and the size of this problem, and how passionate I am about it, I really, really, really had to launch Ellevest, to work to close the gender investing gap.
So what will Ellevest look like?
Well, stay tuned, because we’re working hard to build it. By “it” I mean an investing platform that, as I like to say, meets us women where we are, rather than asking us to contort ourselves to where the industry is.
What I promise is that Ellevest won’t urge us women to “invest in the stock market instead of buying shoes;” it won’t chirp about “6 budgeting tips for fall;” and it won’t drown us in mountains of dry “financial education.” (You’re welcome.)
More to come, but I promise, it’s going to be unlike anything else that’s out there. And it won’t be boring.
Keep up with us at Ellevest.com.
Originally pubished on LinkedIn.
