Podcast with Catherine Flax, CEO of Pefin (with full transcript)
Gaining a better understanding of the world’s first AI financial advisor
Authors: Elena Gerasimova, Nipun Jasuja
Latest Wharton FinTech podcast: Elena Gerasimova (Wharton 2018) and Nipun Jasuja (Wharton 2018) chat with Catherine Flax, CEO of Pefin, the world’s AI financial advisor. Established in 2011, Pefin is a fintech company based in New York City. Pefin, which stands for PErsonal Financial INtelligence, uses Artificial Intelligence (AI) to provide fiduciary financial advice at the fraction of a cost of a traditional financial advisor. On the day this podcast was recorded (November 30, 2011), Pefin went live to end consumers! And we couldn’t be more thrilled about that. Tune in to learn how Pefin is different from traditional roboadvisors that we’ve come to know, what really is the “AI” behind Pefin and why it took six years until product launch, and some invaluable nuggets of professional wisdom from Catherine.
Catherine Flax joined Pefin as its CEO recently. She has had a multi-decade, distinguished career on Wall Street and been a leader in the fintech space. She was previously the Managing Director and Head of Commodity Derivatives, Americas at BNP Paribas and Chief Marketing Officer of J.P. Morgan. She was named the Most Influential Woman in European Investment Banking in 2012 and one of the 100 most influential women in European Financial Markets in 2010 and 2011.
Full Transcript
Nipun Jasuja: Hello, everyone. Welcome to another episode of the Wharton FinTech podcast. I am Nipun Jasuja, your host today, and with me here is my cohost, Elena Gerasimova.
Elena Gerasimova: Hi everyone.
Nipun Jasuja: Today we are super thrilled to chat with Catherine Flax, who is the CEO of Pefin. Today’s episode is going to be largely about understanding the space of financial advice, and specifically how Pefin is disrupting this space with a model that’s quite different from the robo advisors that we [00:00:30] have come to see and learn about. Pefin was founded in 2011 in New York City. Pefin stands for personal financial intelligence. It uses artificial intelligence to provide fiduciary financial advice at the fraction of the cost of a traditional financial advisor. Catherine joined Pefin as its CEO recently. She has had a multi-decade distinguished career on Wall Street and a leader in the fintech space. She was previously the Managing Director and Head of Commodity Derivatives, Americas at BNP Paribas, [00:01:00] and Chief Marketing Officer of JP Morgan. She was named the most influential in European investment banking in 2012, and one of the 100 most influential women in European financial markets in 2010 and 2011. And to top it all, Catherine just told us that Pefin launched to customers today, so we couldn’t be more thrilled to have Catherine with us today. Catherine, welcome to the show.
Catherine Flax: Thank you so much for having me. It’s really a pleasure to be here.
Elena Gerasimova: It’s so great to have you. So maybe to start it off, [00:01:30] what was the impetus for you to join Pefin in the first place after the exciting roles that you have had in big financial institutions?
Catherine Flax: So you know, the funny thing is, is I loved the work that I did in financial services. And so it was not at all at a point where I was saying, oh my gosh I want to leave this and go do something else. It was really a process of understanding how much the world is changing right now, and I was really fortunate that when I was at BNP Paribas I [00:02:00] was very involved in their fintech initiatives. They had an innovation board and I sat on that innovation board. So I could see a lot of the different fintech companies coming through and the impact they were having on banks and financial services in general. And also, about two years ago, I was asked to join the board of Digital Asset Holdings, which is a blockchain company. And all of that really accelerated my interest and my understand, I think, of what’s happening in this space.
But six years ago, a [00:02:30] very dear friend of mine, Ramya Joseph, founded Pefin. And so I kept up with all of the work that Ramya and the team were doing on bringing this platform to life. And about two years ago, Ramya asked me to be a formal advisor to Pefin. And it was really because the business was about to go from the building into the commercializing of the product, and she asked if I could help her with that. But she also asked if I could help find her a CEO. So we did a CEO search together, and really, never [00:03:00] in my wildest dreams did it … it never crossed my mind that it would be me. But as we worked together a lot, and through that process I gained so much insight into what would be a good CEO for Pefin that when she came and asked me if I would consider it, it felt like a very natural fit. And it was a process, really, for the two of us for a few months going through how are we sure that this is really the right thing for me to change my career, for Pefin to have me come in. And at the end of it, [00:03:30] we were very, very comfortable.
And so it was a very natural and easy decision to make. And I will say that I’ve been now at Pefin both in an advisory full-time capacity as well as the CEO for almost seven months, and it’s been the most interesting and exciting seven months of my career by far.
Nipun Jasuja: That is so fantastic to hear, especially from a fintech perspective. We always say that innovation is not just happening in smaller companies. And you talking about BNP Paribas [crosstalk 00:03:55] fintech. It’s just fantastic to know.
[00:04:00] So just building on your Pefin journey and your understanding what the company is about, one thing we came across in our research yesterday was just your amazing blog post in Medium, and we kept reading and reading. And to our readers, we’d like to highly recommend that you check them out because they’re clear and they really give you a good sense of what the financial advice space is all about.
Catherine Flax: Thank you.
Nipun Jasuja: So in one of your articles, you mentioned that you see Pefin as an opportunity to help shape the industry and the discussion around what it means to be a fiduciary. So the question really is, what does it mean to [00:04:30] be a fiduciary, and how is Pefin redefining it?
Catherine Flax: It’s such an important right now. And clearly, from a regulatory perspective, there’s a lot of conversations both at the federal and state levels around what should advice be. And I think that we probably have all had the experience if we have every gone to a human advisor … And there are some who are terrific. I’m not in the business of slamming human advisors at all. I think there’ll be a place for human advisors going forward. However, I think most of us have had the experience [00:05:00] of somebody trying to sell us the product that’s best for them as the salesperson, not for you as the person receiving the advice. And I think unfortunately, we’re at a place right now globally where there’s a lack of trust in financial services. And we also are at a place where financial illiteracy, again globally, is rampant. And so what we have is not so much people who want to make bad financial decisions, but people who don’t have the [00:05:30] right information in their hands to do the right thing for them. I mean, everybody wants to do what’s best for their families. Nobody wants to have a stressful retirement situation. That’s just not how human beings work. It’s really a question of what information can be given to them so that they can actually do what’s best for them. And that’s just not the incentive structure that historical financial services has established.
And so this was such an opportunity, I felt, to come into Pefin where [00:06:00] the entire foundation of the company was built … and if you read the blog post, you probably know that our founder, Ramya Joseph, she started this company because her dad had lost his job. And she wanted to help him to understand, could he take an early retirement? Was it feasible for him? And he’s an intelligent person, but he’s not a finance guy and he didn’t know. And so for her, it was such a watershed moment to be able to give him the comfort and the peace of mind to see that it could work, that she realized there’s [00:06:30] a lot of people out there like her dad who are intelligent people but they don’t have the tools necessary, or a lot of people just simply don’t have the time to be able to do that analysis. And so fiduciary advice is really something that is truly in the best interest of the person. So when I think about it as a mother, or if I were giving my own mother advice, what would I want somebody to say? And that’s really what it boils down to.
And so if you look at the structure and the way that we’ve devised Pefin, it’s very intentionally not to sell people products. Now [00:07:00] we were in beta for two years with about 4,000 users, and one of the things that happened in beta was we would give people advice, much of which is, you’re not ready to be in the markets. You should save money, and here’s how you might do that.
Nipun Jasuja: [crosstalk 00:07:13]
Catherine Flax: Right. Find an advisor who’s going to tell you, right?
Nipun Jasuja: No one’s going to say that to you.
Catherine Flax: And we also tell people, you need to pay down that debt and here’s how you might do that. Or, you’re not optimizing your 401k properly. Let’s help you understand how to do that. So there are a lot of steps that come before giving somebody, here’s what you do in the [00:07:30] markets. And that’s hard to come by. So that was really important for us in Pefin. So initially when the platform was built in beta, it was only planning and advice. And then at the end, four people that it was appropriate to be in the markets, it would say, okay and here’s the recommended portfolio for you. And then we had so many beta users come back and say, “But can’t you just do it for me?” So then we did build a regulated subsidiary where we can execute on that. But we also tell our users it’s still fine if you don’t want to. You can still take our advice and go execute wherever you want, and that’s totally fine. And that’s a really important aspect of the trust, [00:08:00] because we really want to make sure our users understand that, hand on heart, we’re doing the best we can to give you the right advice as far as we know how to do that. So I think that’s a huge part of the underpinning of what we’re doing at Pefin.
Nipun Jasuja: That’s great.
Elena Gerasimova: Great. So given what you mentioned in terms of the landscape and how it’s changing, we’re definitely seeing I think, for instance over the last couple of years, especially the role advisory firms kind of come in and perhaps tend to take advantage of this change as well. So how is Pefin different [00:08:30] from them in terms of model, and what challenges or opportunities does that present for you?
Catherine Flax: So I like to think about it in a more generalized sense of, how’s the world changing? Because it’s not just about financial services. It’s really every aspect of our lives that’s being transformed by technology. So I know today, I can go online. I have an app where I can take a picture. I had an eye infection, I took a picture of it, I sent it to my doctor, they diagnosed over email, and then they sent me the prescription. [00:09:00] So the entire world is changing. And for me personally, if I’m sitting at home and I feel like sending out for food, one of my criteria is they have to be on Seamless because I’m not picking up the phone and talk to them. Right? It’s all of life. So that’s everything.
So I think sometimes people talk about fintech as though it’s a separate thing. And it is in the sense that it’s financial services, but it’s really just a part of the entire wave of all of this transformation that’s going on in our life. So in that same way, it’s really a question of, what [00:09:30] does somebody want to buy? And if what you want is a generic portfolio that really doesn’t have anything to do with the specific circumstances of your life, then a robo advisor’s probably fine. You pick a risk profile, you get a generic portfolio, and boom, you’re done. But to me, fundamentally, if you go on a robo advisor and say, “I’m 27 years old and make $50,000 a year.” And they come back and say, “Well this much of your portfolio should be in equities and this much should be in fixed income.” If you don’t know … Do I live in New York City or do I live in Tulsa, Oklahoma? [00:10:00] Do I have 10 kids or do I have no kids? Do I have a huge endowment in my bank account or do I have massive debt? Unless you know those things, you couldn’t possibly give somebody the right advice.
I’m not saying there’s not a place for other kinds of services in this market, but when it comes to actually giving people advice, it has to be tailored, when it’s finance, to you specifically. There is nobody like you. There’s only you. And unless you’re getting the advice that fits your life, it’s not going to be useful advice.
Nipun Jasuja: [00:10:30] How do you see these two models sort of coexisting? Because you said we have this more passive robo advisory space, and at Pefin, you think it’d play directly in competition with the robo advisory space? Or you feel like right now the target audience is a different?
Catherine Flax: It is different in the sense that … I think about it a little bit like when you think about when mp3 players came out. Right? So mp3 players were a [00:11:00] very specific thing, and so some people would buy an mp3 player. That’s not a bad thing to do, right? That’s okay. But when you then have an iPhone that has all of your music, and it has a flashlight, and it has a camera, and it has all of these other things, that’s a holistic service. The way I think about it, Pefin is that, and robo advisors are the mp3 player. Different people have different needs, but I think starting [00:11:30] with the fundamentals of what is the advice that you actually need, to me, is the right place to start. It’s a philosophical thing.
Now, there are human advisors as well, who of course are … there’s a wide range of human advisors. But clearly, their intent, if you’re a good advisor, is to give that personalized advice. I think the challenge is it typically costs between $2,000 and $10,000 to get a financial plan. A lot of people, that’s not [00:12:00] affordable. You typically need to have $100,000 or more in assets under management. A lot of people don’t have that. And then the other thing is that, how often do people talk to their human advisor? Once, maybe twice a year. So then that advice you’re getting is literally stale the minute you walk out the door and it’s not keeping up with all of the changes that are happening in markets or in your life on an ongoing basis, so it’s not the same dynamic.
Again, I think that there’s a place for human advisors, but what we saw in our beta were we have users [00:12:30] who have human advisors but who actually use Pefin alongside it, so that when they go talk to their advisor, they have a much more dynamic conversation and they’re better informed.
Nipun Jasuja: Which makes sense. And I think just by the way you’re describing it, this is certainly something that’s a lot more intricate and complicated than just looking at the mean variance portfolio and trying to maximize it.
Catherine Flax: Exactly.
Nipun Jasuja: And so we keep reading in the media about the use of artificial intelligence and that is the favorite buzzword in [crosstalk 00:12:54].
Catherine Flax: It sure is.
Nipun Jasuja: But from Pefin’s perspective, what does that really mean? And specifically from an interface standpoint, [00:13:00] like if I’m getting an advice from Pefin, who am I speaking with? Am I speaking with someone at all? And what’s exactly happening behind the scenes?
Catherine Flax: All excellent questions. I think from the perspective of who are you speaking with, it is an online platform and you are not speaking to a human being, so it is all artificial intelligence. As you know, artificial intelligence is a very broad field, and so there are many, many types of artificial intelligence. And I think typically when people think about artificial intelligence, they think about a generalized [00:13:30] artificial intelligence, which is people like you liked books like this. Or you feed a million pictures of a cat into the computer and then the computer can tell you that’s a dog not a cat, or whatever. So that’s generalized. And there are places for that, but those places are typically not in your personal finance. It’s typically not in your medical advice. It’s typically not in self-driving cars, because your generalized car driving is not nearly as good as [crosstalk 00:13:55] getting in an accident, right? So that’s not going to help you.
We do use generalized AI [00:14:00] in the Pefin platform, but only as it pertains to content generation. So we do a tremendous of financial literacy and education and information for our users, and that is tailored to more of a profile of someone like you might want information like this. But the actual advice is based on a neural network that has really hundreds of data points that involve your personal financial situation, everything from your income and your savings to the children you have to [00:14:30] where you live to many economic variables. The entire US tax code is built into Pefin. Every state tax code is built into Pefin. Every university in the United States in terms of cost is built into Pefin. Things like daycare down the zip code is built into Pefin. And on and on and on.
And so what happens is that at any one moment in time, all of those many variables have a relationship in your life. And then what Pefin does is they understand that relationship, and then it propagates forward until you’re 100 years old. And so that’s one aspect [00:15:00] of the artificial intelligence. And so then, if you say to Pefin, “I live in Philadelphia but I’m going to move to New York City,” with a push of a button, all of those variables change because the neural network understands how does that all differ from Pennsylvania to New York City for instance. So it’s very complex, which is why it took six years to build. It’s a very complex platform.
Nipun Jasuja: 2011 to 2017 now begins to make sense.
Catherine Flax: Right? And then there’s the other aspect of artificial intelligence that we use is reinforcement learning. And so [00:15:30] what happens when you come onto the Pefin platform is, typically users plug in their credit cards, their checking accounts, their debt, their investments, and so forth. And through that, we get really a realtime visibility into your financial behaviors and your financial life. So Pefin learns your financial behavior and will share that with you. And so that over the course of time, as your spending patterns emerge and how you react [00:16:00] to an increase in income and all of that becomes built into the platform. So that’s a learning process that does take a little bit longer, but then it’s extremely helpful because then as Pefin projects forward your retirement or your future earnings and all of that, understanding your behavior around your money is very, very important in all of that.
It’s also important because sometimes the advice that Pefin gives is around savings. And so if the platform says, for instance, your plan to buy a house in five years [00:16:30] doesn’t quite work in your current budget. Would you be willing to spend 10% less on your discretionary income? And let’s say you say, “Yes I would be willing to do that,” and then three months later you’re not doing it. The platform is going to come back and kind of gently tap you on the shoulder and say, “So you said you were going to do this. You’re not really doing it. Should we find another way?” And so that kind of reinforcement is really important for people because with the best of intentions, sometimes people get off track and also maybe aren’t that realistic about their own behaviors. When it’s there for them in black and white, [00:17:00] it makes it much easier for them to make actual decisions and be realistic about what’s going to work for them.
Nipun Jasuja: That’s great. It’s fascinating how so much is going on behind the scenes that you don’t even see.
Catherine Flax: And one of our major goals at Pefin is to make sure that the user interface is as simple and lovely and enjoyable to use as possible, and for users who really aren’t interested in the details, it keeps it nice and simple. For users who really want to know why, you can really click in and really dig into the reasons why. Because we [00:17:30] find that there’s a spectrum of users around that.
Elena Gerasimova: I really like that idea about the reinforcement that you mentioned. I think it’s very important to have that, especially for those of us who don’t necessarily feel like we’re on top of things all the time. I’m wondering, what is the option for people who may be, at least at first, are a little hesitant to kind of enter all their information in the system, etc.?
Catherine Flax: Absolutely. It’s a great question and it’s also an [00:18:00] interesting question, because as we’re building Pefin out in other countries right now as well, not all countries have the same aggregation abilities as the US does. So we had built the platform to satisfy a lot of different use cases. And so if you chose not to … Let’s say you said, “You know what? I’m okay connecting my credit card but I really wouldn’t want to connect my bank account” or whatever. No problem. You can do manual accounts, which basically then you just put in at a high level, this is what [00:18:30] my debt is or whatever. And Pefin will come back and say to you, “Well can you break it down for me a little bit in terms of how much of this is food and rent and things that you can’t move, really? And then how much of it is more discretionary spending?” So there’s a little bit of more questions around that if you’re doing it manually rather than adding the account, but it works either way.
Nipun Jasuja: Building onto that, are there additional ways in which you’re thinking [00:19:00] about even simplifying the understanding of financial products? Because a fundamental thing we see here is that, as millennials specifically, if we think about themes and concepts and ideas, but the moment you hear structured products and derivatives and portfolios, you just freak out.
Catherine Flax: Yeah, it’s an excellent question because I think today we have beta portfolios for our investors, which I think for probably 80% or 85% of investors is the right way to go anyway. There’s a lot of data and evidence about passive portfolios [00:19:30] versus more actively managed portfolios and things like that. So I think it’s a good place for us to start, but we have lots and lots of plans, across a lot of different things, to add additional product. And I think it all fits really nicely into the underlying theme in Pefin of financial literacy anyway. So everything we’re doing is involving an education for people of how does this, what does it mean to you, and how can you see it? How can you visualize [00:20:00] what this actually means? One of the things that I love in the Pefin platform is there’s a timeline that basically says, from where you are today out to when you’re 100, what are your projected assets? What are you projected costs and savings and all of that? And of course, no one has a crystal ball. But still, it gives people an opportunity to really consider, if I had this sort of portfolio, or if I saved in this way, or if I bought that house, or if I sent my child to an expensive college, what does that all mean? [00:20:30] And the thing is that all of these decisions are very interrelated.
And I think one of the big shortcomings of a lot of financial planning, whether human or otherwise, today is that they look at each goal in a very discrete way. And so you want to buy a house? Save this much. You want to send your kid to college? Save this much. But it doesn’t work like that, you know? How you choose to pay for your kid’s college is going to impact how big your house can be. And whether or not you’re willing to sell that house when you’re an empty nester is going to a huge impact on your retirement. So unless you look at all of these things [00:21:00] in a connected way, you’re not coming up with the right answer. And even though structured products and investment products are different, it’s a different flavor, but at the heart of it, it’s the same question. What does this mean for me? What is my risk? How does it impact my goals and my life? And at the end of the day, one of the things … and you’ll see this if you read the blog post today. One of the big themes for us is that it’s not about finance. It’s about life. And how do we help people live life? In a perfect world, people [00:21:30] would spend less time on their finances because they don’t have to. Right?
Nipun Jasuja: Exactly. So let’s say, as an MBA student, if I go and join Pefin today and I’m graduating next year, but if I go and type in that, let’s say I want to buy a house and even save some money for my wedding, what kind of advice can I expect from Pefin? What is it that I would get out of that?
Catherine Flax: Well the short answer is, I can’t tell you because I don’t know enough about your costs, because it really matters. You know? I mean, how much money do you have saved [00:22:00] already? What are your student loans like? And all of those things really matter. And what Pefin is going to do is, we have what we think is a really cool chat format that’s really nice. So when you come in and say, “This is what I want to do.” The Pefin chat is going to come up and say, “Okay well those plans are 80% achievable given your current situation today. Would you be willing to try this?” And you can say, “Actually no, I’m not willing to reduce my spending.” Okay.
Nipun Jasuja: So it’s just suggests alternatives.
Catherine Flax: Absolutely. It’ll suggest until you get to an answer that works.
Nipun Jasuja: Fascinating.
Elena Gerasimova: [00:22:30] I would like to change gears a little bit and perhaps talk a little bit about some things that you have written about on your post as well, which is kind of team building, and not just personal growth but focusing on collective growth as well. We would love to learn a bit more about that, especially as it relates to your role at Pefin now and how you deal with that.
Catherine Flax: Sure. Well you know, it’s always been a real passion of mine. The [00:23:00] books I read, the things that I’ve thought about over all the years that I’ve been in financial services. Because even though it’s so cliché and people say it all the time, that it’s really about the people, it actually really is all about the people. And partly because they’re the ones who are actually delivering all the work, but also, we all spend an enormous amount of time at work every day. And if you’re not actually building meaningful relationships with the people that you’re working with, and if they’re not coming in every day and being really excited about what they’re doing, [00:23:30] that’s a tragedy.
And I’ve said this to my teams over many years: Of all the different investments that you’re going to make in your life, to me, the most important one is, how do you spend your time every day? And if it isn’t really filled with meaning for you, you’ve got to find something else to do. And I would encourage anybody who works for me, if they don’t feel like that, please find something else to do. I will help you find something else to do. But I’ve been really blessed to be really excited about coming into work almost every day of my career, and I really want other people to have that too, because this is your life. I mean, you don’t get another one so you may as [00:24:00] well make the most of it.
So that’s kind of where I’m coming from in all of that. And again, I have three kids of my own. I want them to be excited about their lives and going into work every day. It matters so much. And I love working. I really love, I love going into work every day. On my Pefin timeline, I pushed my retirement [crosstalk 00:24:18] because I really love it. But I think from a team perspective, there are some really fundamental basic things. And everything is sort of motherhood and apple pie, so there’s nothing I’m going to say that you’re going to be like, “Oh wow I never heard of that before.” [00:24:30] I think the difference is, how do you actually make it happen every day? So treating people that you work with with respect is an obvious thing. And I mean, I’ve had the privilege of working with some excellent leaders. And I know Jamie Dimon, one of the things that he talks about all the time is, treat the person who cleans the office the same as you treat the CEO. And I believe in that so much. My grandmother was the person who cleaned the office. And so to me, of course you treat those people the same way as you treat everybody else.
[00:25:00] And so it’s just basic stuff, like normal human values. But sometimes in a lot of work places, those normal human values go out the door the minute people walk in the building. There’s no reason for that. It doesn’t have to happen. And so I think there’s that.
And then I think the other thing too is really listening to people. For the most part, my experience is, more than anything else and even more than money … although I think it’s actually very important to pay people fairly because I do think that there is a little bit in nowadays of kind of smoke and mirrors of “let’s make it super fun! Oh by the way I’m not really going to pay you fairly.” I [00:25:30] don’t believe in that either. So I do think you need to pay people fairly. But I also think that most people, what they really want is they want to be heard, you know? They don’t want to be taken for granted. They have good ideas. Everybody has good ideas. And creating a situation where they can actually express and have a conversation at whatever level and that they can continue to learn as well is fundamental. And I think if you can do those things, then you’re going to have a vibrant work environment where people are all really kind of pulling together and excited.
Nipun Jasuja: [00:26:00] So then, what were some of the challenges you faced in finding those kind of people who would be willing to come to Pefin, especially in 2011 when obviously you were starting and it took six years to get to this point?
Catherine Flax: Well you know, as you know, I was not at Pefin in those days. But one day hopefully you’ll have the opportunity to interview Ramya Joseph, who’s our founder. Ramya is an amazing woman and a real visionary and just has an enormous amount of conviction, and is brilliant. And so I think that [00:26:30] Ramya has had incredibly low turnover in the years that she started, and since, in Pefin. And we have terrific people. But when you have somebody like Ramya running the business and starting a business, people want to work with people like that, you know? They can really understand where this is headed, and they want to join that. And that’s really what’s happened. And we’ve really been so fortunate with incredible, incredible people on the team.
Nipun Jasuja: That’s great. And building on the culture point, right, it’s also things like Pefin [00:27:00] has committed to a portion of its revenues that go towards charities. What’s the motivation there? We see increasingly a larger number of companies doing it.
Catherine Flax: Yeah. Well I think for us, it’s something that we talked a lot about because even though we do believe that financial planning and advice is critical to get people to a place where they can have financial wellness, which impacts every aspect of their life, we also know that there are people who [00:27:30] have situations where they’re so catastrophic that they’re not able to focus on things like financial planning and wellness because there are bigger problems unfortunately. So part of what … You’ll see on our website, that’s the new website since we launched it, we have a section called “Sharing Our Strength.” And that’s really how we feel about it, is we’ve been really fortunate and we know that if people are on the Pefin platform that we’re delighted that we’re able to share with them financial wellness. But we also believe [00:28:00] that most of the people who are going to be using the platform would want to know that the people who aren’t quite there yet maybe have a hand to get there and get to where they could be at that point in their life.
So we have three different charities right now that we’re giving to. One is focused on helping people who can’t afford to go to college, go to college. We have one that’s focused on providing housing for disabled veterans. And then the third one is helping families have vacations if they [00:28:30] have a terminally ill child. And those three … And there’s many wonderful charities in this world, but those three really resonated also with us because we think about life in terms of life events in Pefin. And those are all … buying a home, going to college-
Nipun Jasuja: Important milestones.
Catherine Flax: Milestones for people. And so if we can help people achieve those milestones when maybe they wouldn’t otherwise be able to do that, it’s really important. The other thing for us too is … I think this is also kind of part of the whole team mentality, is [00:29:00] it’s one thing to give money, and I think that’s very important. But there’s also the aspect of, how do we as a team contribute together beyond money? Because there’s something that’s, I think, very important for your soul to actually get out there and meet people face to face and help them that way. And so our team collectively comes up with ideas of things that are meaningful to us. So just recently a couple weeks ago, we got [00:29:30] together and delivered and served breakfast at the Ronald McDonald House in New York City, which is dedicated to families that have children who are getting their cancer treatments in New York City. And it’s a wonderful charity. I’ve written about Ronald McDonald House. I’m hugely partial to it. But I think it’s things like that where you actually as a team you get together and you do something. And it’s a priceless experience together to be able to give back like that.
Nipun Jasuja: That’s great.
Elena Gerasimova: It definitely sounds like Pefin is thinking [00:30:00] about finding these more inclusive solutions, if you will. And I do think that a lot of our listeners and the other MBA students here who are interested in working in the financial services space are also looking for some type of engagement that is more inclusive. So for those of them, would you have any advice or kind of any suggestion about what areas to target really?
Catherine Flax: [00:30:30] You know, I think that … I’m a big believer in going with your gut. And the culture of a company, whether it’s a startup or it’s an established financial services or any other kind of company, you learn a lot in the process of interviewing and meeting people. And it could be on paper the best company in the world that has all of the right attributed, but if you walk in there and you really feel like this is not the place for me … that’s happened to me in my career [00:31:00] in my interviewing process. And I think it’s really important to find those places where what matters to you matters to them. And I think at Pefin, this was not a situation where Ramya was like, “Oh I’m an expert in AI. Let me see what I can do with that.” It was really a situation of, I have a problem I want to solve. And because everything comes from that, it manifests itself throughout the company. But it can be true in a lot of different companies. But I think when you’re at that point where you’re making a career move, I think a lot about that fit.
[00:31:30] But I think the other thing for me personally, because I’ve done quite a lot of different things in my career, I think the most important thing for me was, do I really feel excited about this? Even if it’s not an obvious change, it’s not … Everything in life is not an up move. But if it’s something that you know you’re going to be really excited about and you think you’re going to learn something from it, it’s worth doing, even if it’s not what your life ambition is or whatever.
Elena Gerasimova: And maybe last question, do you have any specific [00:32:00] advice for female students who are really striving to follow in the footsteps of a role model like you?
Catherine Flax: Well thank you. You know, I think my advice for the women would be the same as it is for the men, which is, find that intersection of what you love and what the world needs, and focus on that. And don’t be afraid to make a mistake. Don’t be afraid to make the wrong decision. You know, I think sometimes we get in our heads that if [00:32:30] we take this job or if we make this move, it’s kind of like, that’s forever. It’s never forever. And you’re always going to learn something. And I think as long as you’re learning along the way, it’s never for nothing. And sometimes for me, some of the career decisions that seemed a bit random at the time have turned out to be the ones where I’ve learned the most and that actually shaped so much of where I’m heading down the road. So I think that a bit goes to trust your gut, and just don’t be afraid.
Nipun Jasuja: Some amazing words to end on. Catherine, thank you so much again for taking the time.
Catherine Flax: [00:33:00] Thank you for having me.
Nipun Jasuja: And again, we are so delighted we could interview you on the day of the Pefin launch. So we with you all the success.
Catherine Flax: Thank you.
Nipun Jasuja: And we hope more and more of our friends and our [inaudible 00:33:07] also sign up on this platform and see what’s in store for us.
Catherine Flax: Wonderful. Thank you so much for having me.
Nipun Jasuja: Thank you so much.
