According to Vera Behr, Fmr Director of Product Management at Ellevest

American author, former Republican Congressmember and United States Ambassador Clare Booth Luce once said, “A woman’s best protection is a little money of her own.”

Now this sage advice could apply to anyone, but I choose to believe that words of wisdom such as this inspired former CEO of Merrill Lynch, Smith Barney and Citi Private Sallie Krawcheck to launch Ellevest, a financial management service with a single goal in mind: to give women the power to invest in ways that are on par with men.

Krawcheck is regarded by many as the most powerful woman on Wall Street, and as of April 2022, Ellevest has raised $53 million in Series B funding, which is backed by a remarkable roster of women and allied investors which include (but are not limited to) — Halogen Ventures, Gaingels, Cleo Capital, New York Ventures of Empire State Development, and Stardust Equity.

Like Krawcheck, Ellevest fmr director of product management Vera Behr (now product manager at fintech company, VolumeFi) believes it’s essential to guarantee women have access to the right kinds of tools designed to improve their financial health in order to seize more opportunities. While her focus admittedly is on digital services, Vera also maintains a keen interest in growing her understanding of how clients wish to grow their investments, while providing expert support for Ellevest financial planners and specialists.

Vera Behr

At the New York Product Conference in Times Square, during a six-minute lightning talk, Vera shares with an audience — with surprisingly enough enthusiasm to attend a conference on a Saturday — stories and lessons learned while building fintech products.

After the presentation, we sat down for an in-depth conversation to learn more about how and why Ellevest is committed to their mission, which is, as she forthrightly states:

“We want to put more money into the hands of more women.”

Ellevest is an online platform specifically designed for women. They strive to make investing easy via automated financial adviser technology or “robo advisers,” with additional support from experienced financial specialists — all geared toward women.

While closing the gender money gap is a top priority for the company, men are not excluded from signing up for Ellevest services.

The platform is tailored to an individual’s salary, gender and approximate lifespan. But for all intents and purposes, Ellevest is essentially a “hands-off” investment tool for women. As clients make more money, Ellevest takes a small percentage for their services.

According to Vera, co-founders Sallie Krawcheck and Charlie Kroll did not intend to build an investment firm specifically for women, at first. When they started the company, Krawcheck did not believe women needed a product of their own, until she started reading the data and realized that the finance industry needed to change. She also believed women are smart enough to do investing on their own.

Sallie Krawcheck and Charlie Kroll, Co-Founders of Ellevest

While women are certainly smart enough to invest successfully, what Ellevest eventually discovered is that most women are much more cautious than their male counterparts. Women were not investing as much as they should. “Most women kept their assets in the form of cash and never invested in something worthwhile,” she says.

“In the United States, many women control a significant amount of wealth, but they choose not to invest, failing to put their money to work. Women want to understand all the risks before getting started. Men are not necessarily better informed than women, they are just more willing to work with risks they do not fully understand. Ellevest wants to help women to be informed about the risks and determine the best way to plan financially for their life goals.”

But in the spirit of financial empowerment, Vera is not referring to providing services comparable to hand-holding. Part of the company strategy is to help clients figure out how much money they should put away (ideally each month) and other monetary decisions, which ultimately depends on how individual clients live their lives.

“The point is for clients to make money for achieving realistic life goals, rather than just making money for the sake of money.”

According to their research, when it comes to money management, many women also put their funds into savings accounts and lose money over time, as inflation changes the value of the money in the bank. They also learned women do not know enough about how investing works to participate.

So, under Krawcheck’s leadership, the company decided to step in and fill that need in a relatively untapped part of the market.

The Ellevest app is the latest venture by the company to offer easy investing solutions. Part of the company’s goal is to take into account that women earn less on average, but still provide support and encourage profitable investing habits.

As Ellevest CEO, Krawcheck understands women have goals and need to reduce risks. This understanding, combined with client research data, informs Vera’s decision-making strategy, as well as decisions made by the company as they operate in a niche market.

“According to our research, most women keep their financial assets in the form of cash, rather than investing. Ellevest wants to change that,” Vera says. “During the sign-up process to get started, we [Ellevest] ask questions about gender and income, as well as personal goals. Whether people want money for housing, travel or other expenses, the personal info helps us to guide their investment strategy for that account, and recommend the amount of money needed to create the wealth desired. By doing the investing for women, we are trying to get more women investing and making more profit.”

According to Krawcheck, when she spoke at a fintech event in New York City, Ellevest was created to meet the needs of the demographic traditional financial services haven’t served.

This demographic is typically women in their 30s or 40s, in stable careers, with enough money to pay their bills and enough left over to put into savings accounts and do whatever else they would like.

In light of the success of the platform, it made sense for the company to grow their offerings and launch the Ellevest app. When they first launched the app, they experienced an increase in client growth, which they had predicted.

However, Vera admits something else happened they did not foresee.

To her surprise, they saw significant growth in the diversity of the client demographics. “Unexpectedly, we experienced growth in terms of a wider variety of new clients, especially in regard to age and income,” she says. “Far more lower-income women were participating with the release of the app. In addition, women of much younger ages were using Ellevest. The majority seemed to be young college students that had just graduated.”

“Young women just out of school have a lot more debt than most other clients. As many of us are aware, American student-loan debt is at an all-time high. With this current situation in mind, investing is fundamentally different for younger women. These new women signing up for Ellevest have student loans to be paid off.”

Women who are recent college graduates, or anyone with student loans tend to be unsure if investing is right for them, according to Vera. However, for Ellevest, this is not necessarily a bad thing. In fact, this kind of uncertainty presented an opportunity to tap into a niche market:

“Many of the women didn’t feel like they had enough money to get started with investing. Contrary to popular belief, you don’t need an obscene amount of money to get started. Ellevest allows women to build up their funds over time. No one has to drop thousands of dollars to get started.”

So after the launch, teams at Ellevest realized they would need to reach out to these young women and make it clear that any dollar amount can get them started. They recognized there were opportunities to determine how they can cater to women with that special need. They also realized they needed to make changes in their product categories and services.

Product teams then engaged in more research to identify the best approaches for helping out women in these newly discovered demographics. Young women starting out in the “real world” are not the same type of investors as women with steady careers in their mid-forties.

Investment should not be blocked for people who do not yet have a stable life. That is why Ellevest has to adjust and allow clients to invest, but on their own terms. Everyone’s situation is going to be different, so providing an optimal client experience is crucial.

Under the leadership of Chief Product Officer Alexandria Stried, product and UX teams at Ellevest work together to perform user research and ethnography. They engage in various activities, including:

  1. Reviewing details about client activity with website analytics tools.
  2. Ethnographic interviews with current and prospective clients in person or with Google Hangouts, Skype, etc.
  3. Opportunity assessments to examine specific questions around which problems product ideas are striving to solve (for example: Who is the target audience? Which KPIs will be affected? What other products are on the market that make for great inspiration?).
  4. Periodic client surveys.
  5. Inviting clients to Ellevest offices to use products, which gives the product teams the opportunity to observe and evaluate the client experience.
Alexandria Stried, Ellevest Chief Product Officer

According to Vera, when they launched the app, Ellevest received valuable feedback via client surveys. They also found value in the informal feedback from other clients, received via fellow Ellevest colleagues. Vera realized Ellevest employees are also a great source of feedback. After all, they also experience varying forms of uncertainty and anxiety regarding their ability to build wealth successfully.

As the compliments and criticisms continued to roll in, Vera worked closely with the product, engineering, UX and client-support teams to analyze and compile information that proved to be useful towards making improvements to their products and services. “Instead of sending out client surveys once a year, Ellevest provides them four times a year, but only once a year to each investor,” Vera says. “We do this to ensure we are not perceived as a company that frequently and unnecessarily sends out surveys. With this distribution method in place, we manage to get a 20%–40% response rate.”

It’s quite a clever approach. For example: If 500 new clients sign up on the Ellevest app during the third quarter, they will get surveys in the same quarter in each subsequent year. This is done to ensure clients who sign up between October and December 2019 do not receive surveys between January and March 2020. Instead, new clients in November 2019 will only receive surveys between October and December 2020; and those who sign up February 2020, will only receive surveys between January and March 2021.

“The differences in the survey responses to each of these surveys help Ellevest to see short term changes from quarter to quarter, as well as long term trends that play out over the years.”

When the product teams review client support data, they compile the most common inquiries from clients that are later researched, and they take into consideration that their individual context matters.

“As a general rule, I do not want to fix one issue while creating another, so I am very careful with my research and analysis when reviewing client support tickets,” Vera says. “Sometimes when I review client data, I do it side by side with partners from UX, engineering and, ideally, one of our financial advisers. The idea is to ensure that our teams are on the same page, as we learn about how our clients experience our services. It has proven to be an effective way to consistently improve our services.”

In the interest of not excluding the previously mentioned demographics out of investing, Ellevest committed themselves to making changes to their product and service lines. In addition to thinking up new products, Vera and her colleagues work to identify methods for helping clients via the mobile app itself. This is done, because they realize the importance of providing clients with the knowledge necessary to make sound financial decisions.

“For our clients to succeed, they have to be well-informed, so that was made a priority in the app design.” Vera says.

First, they took the educational content they already created on the platform and made it easily accessible for their inexperienced audience on the app. Second, they worked to minimize and, in other cases, eliminate areas where clients felt uncertainty around making the right investment choices. Sometimes that meant providing ways for clients to contact financial advisers.

“Countering the feeling of the unknown for someone who is living in uncertainty is a challenge, so we recognized that advisers needed to be constantly available for young women investing.”

In addition to supplying direct connections to financial advice and the specialists who provide the information, clients (especially new ones) are not made to feel alone, because they also have access to a community of other women who are in the same situation. By fostering engagement with the organization and the community, Ellevest product teams work continually to fix the problems of uncertainty, especially for the younger clientele.

Vera finds it refreshing to do something that helps women and minorities find financial success when planning for retirement. Whether it’s buying a home, starting a business, investing for children, emergency funding or general wealth-building, Ellevest keeps these goals in mind when providing a platform for the financial empowerment of women.

Vera’s methods for measuring company success and the changes they make to their services usually include looking at the number of users and funding rates. As she examines the number of clients in respective cohorts over time, measuring and improving the numbers that matter the most for financial advisers and their clients, is essential when optimizing key metrics:

“If people put money into investing, it’s not necessarily about how much money is dedicated, but the rate of investment. And our financial advisers know they are doing things right when they see clients consistently developing their portfolios. The insights they provide is proven effective when funding rates for an individual user increases.”

The company is also concerned with maintaining ethical standards. But it’s not just about ethics for Vera. She wants to see that money is traded the right way. Ellevest does not want to lose any funds and have the IRS or SEC asking what went wrong. They want all their clients to succeed.

In trading, investment and all aspects of their product, Ellevest is aiming to provide operational excellence. After all, users are either taking or leaving the advice. The trading itself is not a part of the process users see. Ellevest handles trading, and clients do not get to choose specific stocks. Everyone can go to the website or mobile app to monitor the progress made from their investment decisions, but they do not make specific choices themselves. The particularly complicated part is handled in-house. This means Ellevest has to build trust with their clients.

“Because we’re dealing with finances, we definitely put a big emphasis on doing right by the client and what we generally call ‘operational excellence’ or ‘advice quality.’”

It’s indeed a fact that there are few firms that cater to women’s financial needs. This is where Ellevest rises to the occasion.

If there were many other firms tailored to women’s needs, perhaps Ellevest would not be so committed to servicing their niche clientele. Nevertheless, Vera and her colleagues ardently believe that Ellevest serves a vital purpose in today’s market.



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