Former Citigroup CFO Sallie Krawchecklaunched her anticipatednew startup, adigital investment platform for women calledEllevest, this morning from the TechCrunch Disrupt NY 2016 conference’s stage. Krawcheck is not your typical startup founder, which makes her entry in the investing space particularly interesting. Prior to Ellevest, she was the president of Global Wealth and Investment Management at Bank of America andthe CEO of Smith Barney and Sanford Bernstein, in addition to Citigroup.
She alsobought Ellevate, aglobal network with tens of thousands ofmembers thatpromotes women as business leaders.
However, until now, all we’ve known about Ellevestis that it’s focused on helping women invest, and that the companyraised $10 million in Series A funding last fall.
That round was led by investment research firm Morningstar, and included participation fromMohamed El-Erian, chief economic adviser at Allianz and the former CEO of PIMCO; Ajay Banga, president and CEO of MasterCard; and Brian Finn, former president of Credit Suisse First Boston, according to an earlier report from Fortune.
Krawcheck will serve as the companyCEO and fintech startup Andera’s founder Charlie Kroll is Ellevest’s COO.
At Disrupt this morning,Krawcheckdisclosed further details of her team, which includes Chief Investment Officer Sylvia Kwan, who hasdegrees from Stanford and Brown, as well as people with technology industry experience from places like Vogue.com, Thrillist, fintech startups and a PM from Weight Watchers — a company dedicated to getting women to embrace change. That seems applicable, in a way, for a startup focused on getting women to change how they manage their investment strategies.
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Krawcheck explained that when she first began working on the company she had to discard a lot of myths about how women approached investing — that they weren’t as savvy, or as good at math and thatthey needed a lot of remedial financial education. She also thought women had to explore their emotions around money — something she said reflected her own gender bias, as it turned out.
But after spending hundreds of hours with women to better understand their investment goals, she realized that what women want are things like money to start businesses, buy homes and retire well. And they don’t need anything beyondan investment platform that takes into account their own particular challenges.
Ellevest focuses on what women face when it comes to investing that men do not, explains Krawcheck.
“This isn’t ‘for women,’ ‘pink it and shrink it,’ ‘make it smaller,'” she says. “We’re going to forecast out yourlife so thatyoucan achieve yourgoals. And then we’ll put a bespoke investment portfolio against eachgoal to help her achieve them.”
And, Krawchek adds,“If you’re going to plan —no one else does this —you have to use powerful technology, powerful finance, in order to take into account her unique circ*mstances.”
Women, for example, need a platform that takes into account not only her earnings, but also her salary arc — which is different from men’s. It needs to account for the fact that women live longer than men, on average, when planning for retirement. It needs to understand the salary differentials between a woman’s pay and her male counterpart’s payand how that impacts her strategies.
And it also will take into account those decisions that women tend to make more often than men — like taking a couple of years off from a careerto raise children, for instance.
“Nobody is having that conversation,” saysKrawcheck, of this career break. “But obviously, as a woman, that can keep you from achieving your goals.”
The servicewillalso regularly engage with clients, updating their portfolios to reflect their evolving goals. And if a woman gets off track, Ellevest will reach out to tell you, in a highly personalized way, what you need to do to get back on, she says.
Krawcheck claimsthat Ellevest, which is already in private beta testing with a few hundred women,will help women meet their goals or better in 70 percent of market scenarios.
“Our goal was to make [investing]approachable and achievable for all women,” she says.
The service’s products include managed ETF’s to keep costs down. It’s not “the cheapest” — the website’s FAQ says it charges an annual fee of 0.50 percent of anaccount’s average daily balance — but it’s lower than what some other firms charge, saysKrawcheck.
Ellevest is live now, but is requesting women sign up for invites which will be distributed on a rolling basis.
