Wall Street ignores women. Ex-Merrill Lynch CEO Sallie Krawcheck is trying to fix that.
Krawcheck’s new company Ellevest wants to help women meet their financial goals.
Courtesy Ellevest
When Sallie Krawcheck was a 24-year-old research analyst, she says she was “the most senior woman banker” at her company in all of New York City.
Since then, she said on the latest episode of Recode Decode, hosted by Kara Swisher, the gender imbalance has gotten even worse.
“Wall Street was very male going into the [2008 financial] crisis and was even more male coming out of the crisis,” Krawcheck said. “These trading floors are a sea of guys.”
That matters both because diversity has been shown to correlate with financial performance and because women in the workforce need to invest, just as men do.
Krawcheck’s new company, Ellevest, which launched earlier this year, is an online-only investment platform that purposefully caters to women, which it says have been historically underserved or ignored by Wall Street.
And she should know: She was previously CEO of Smith Barney, CFO of Citi Group and CEO of Merrill Lynch.
“There’s a gender investing gap in this country,” Krawcheck said. “Women don’t invest as much as men do. ... What’s out there isn’t working. The advisors who worked for me at Merrill Lynch and Smith Barney, 85 percent male. If the advisor and the male client don’t die, in any given year the attrition rate is less than 2 percent. In the year after the husband’s death, the women’s attrition rate is 70 percent or more.”
“Women say the industry doesn’t speak to them, can be condescending to them, doesn’t understand their needs,” she added. “Women are sitting back in their chairs, and it’s costing them a fortune.”
On the new podcast, Krawcheck also discussed how she climbed the ranks at several major banks, why she was fired from Citi and the surprising truth about becoming a startup founder.
“Being an entrepreneur is harder than running Merrill Lynch,” she said. “Even in the financial crisis, I had such a team around me. You just felt like, ‘All of us are going to figure this out.’”
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This article originally appeared on Recode.net.
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