YouSaid · the spoken record

Matthew Weatherley-White

lines on the record: 115
first: 2016-09-09
most recent: 2016-09-09
sittings or episodes: 1
sources: podcast

Every line below is reproduced as it was said and linked to the record it came from. Nothing here is summarised or generated. Directory · Search · Corrections

“It was still a huge difference. And so I started asking myself, what could account for that, right? I mean, really by having 10% of the C level be a woman, is that going to really make that much difference in the operations of the company? And, you know, one thought that came to mind was if you had risen to that level as a woman in England.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“It was like one of those eyeball rollers. It's like, yeah, somebody blew their math, right? Even if you discount that by 50%”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, I think it's about 10 years ago. And they've done follow up reports to that. And it's long enough ago that I'm not going to remember these exact numbers, so I'll just claim that I'm making this up. But it'll give you a sense of the numbers. But they looked at, they did a 25-year regression analysis of companies in the FTSE that had more than, I think it was 10 or 15% of their C-suite were women. And the outperformance was shocking. It was like substantial. It was like 40. Yeah, I”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I think that the demonstration is coming. There are a handful of really interesting, super focused research institutes that are focusing on this issue. Criterion Institute is one that I think is doing some really cool work. I was just musing the first time I read about this outperformance due to sort of gender diversification in the C-suite was the Lord Davies report to the House of Lords probably going back 10 years ago. I was going to say.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Totally. And that's where I have a real quiet but sincere objection to the notion that SRI and ESG investing will transform corporate behavior.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Evolved a lot, and I don't think that even a committed ESG practitioner would look at divestment of investments in South Africa and say that was the exclusive cause of the collapse of the apartheid regime, nor that it led to some influence on performance. Because what happened was, I mean, cynically, there was an asset transfer, right? Into the hands of people who are willing to do entities are willing to do business in South Africa and at a discount.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yes, and I am in no way saying that that is an ineffective or irresponsible or corrosive force in the capital markets, right?”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Conversely, if you're paying attention to Coca Cola because they have great gender diversification at the C suite, that might not be material to the profitability of the company. And so what's happened in the SRI ESG impact sort of translation is that a lot of the early practitioners who really built the discipline were, and I say this with an enormous amount of respect and affection, were activists They were saying.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, and I don't want to imply that only women can make good marketing decisions for women. That's a reductionist exercise that I think breaks down with. Relatively shallow scrutiny, but I think that having a homogenized management perspective in a company that's selling consumer products doesn't make any sense. And it might be material. And so from a reporting perspective, from an investment perspective, if you are looking at Coca-Cola and they're not paying attention to their water exposure, that's a material risk.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Conversely, I would suggest cautiously that gender diversification in the C-suite at Coca-Cola might be relevant to how they think about their consumer base. It might be relevant to the conversations that go on about strategic direction of the company. It might not be material to the net operating profitability of the company. Flip that. Look at Maybelline, for example. Water is not a material factor for them. But it might be that having a diverse gender base in the C-suite and Maybelline is actually central to their operating viability because they're consumer base is going to be buying products that are designed by the C-suite team, right? And so.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“So Coca Cola needs to be thinking about how they manage that resource everywhere in the world all the time. It is material to their operations.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“I mean, imitation is always hard in the capital markets, right? I mean, you chase performance because somebody found an opportunity for alpha. And you arbitrage away the alpha by capital flows. I mean, that's how the capital markets work. And that's one of the things I find so interesting right now about. ESG materiality because there's not very many firms I mentioned generation asset management. There's not very many firms who are doing ESG with an eye towards materiality. Rather than ESG with an eye towards, let's say, responsibility.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Take 10% of this, and she's done a great job with that, I think. And there are firms that have done that with really high IQ solutions around model portfolios, but they have a wickedly smart investment committee. They do a lot of work with controlling stake and direct companies, lots of alternative private assets and real asset investments. I don't do a whole ton of sort of conventional long-only public equity investing. And so the model portfolio looks more like Swinson's portfolio at Yale than it would for somebody who has, you know, $10 million.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Founder of Laurel Capital Management, Wicked Smart, super cool woman. She founded Hall Capital. She's got $25 billion, maybe more than that, AUM. And the whole thing is endowment model. That's it”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“They don't require flexibility, no target date. You don't have to worry about providing increased liquidity. They don't have to know whether or not your client is going to have a kid or want to build a second home or want to invest. It's like all the liquidity factors that you have to think about with individual clients that directly inform the construction, viability, and durability of a long-term portfolio allocation. That's not an issue. And so model portfolios work really well in that endowment model. And people like Katie Hall at Hall Capital have taken the endowment model. She's the CIO at Princeton.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Because in the endowment model where you have clear, consistent, long-term cash flows. You can discount that with an enormous amount of certainty, and you can build optimized models that are going to be in for decades.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“It's a model. And that's why, and I wanted to get to that in the official interview. But I felt you hustling me along. And so I didn't die. No”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Like Generation, who I mentioned on the call before. And we do have exposure to some actively managed long-only public equity, but it's typically people that have high conviction, low demonstrated correlation of the broad markets. Most of our long-only equity is managed for beta. And we do tax management”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, I love your questions. It's great to sit with somebody who knows the financial markets as well as you do. And for those of you who, obviously everybody's listening to this, everybody. Barry just did this like, I'm embracing the world gesture. And if anybody's seen Ann Cuddy's TED talk about how body language informs, I just saw her deal right there. Really?”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, so we are not an impact investing firm We are an investment firm that has an interest for, and I would argue an expertise in impact investing. It's not the same thing. There are a handful of firms that are exclusively impact investment firms. We don't do that for two reasons. One, we think that you cannot simply throw a switch and just convert to 100% impact overnight. So by definition, all of our clients, even those who are Passionate about impact investing, have some conventional investments in their portfolio. So we want to be able to manage the whole balance sheet. And the second piece is we think that at some point in the future, the term impact investing is going to lose its meaning. And we don't want to self-pigeonhole into the future.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“And that's where that lifetime discounted cash flow model really helps. And it's super detailed. I mean, it can take us six months sometimes to build that totally out. And it's an iterative process and all the assumptions get tweaked and revisited. But once you take somebody through that process,”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Over 10 years? You're not compounded annually. Yeah, because if you're. Or you could talk to somebody else and says, I'm super aggressive. I want to get like 8%.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“And yet, that is the fundamental assumption that almost all of these model portfolios are based on what's your risk tolerance, Mr. Investor. You talk to a real estate developer and he'll say, I'm really conservative. All I want is 14%. And you'll talk to over 1%.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“So, if you have a lot of wealth and a relatively low burn rate, that's a modest rate of return. That opens up a really interesting conversation because from that, a client can say, oh, you mean I don't have to hardly take any risk and I can have an enormous sense of confidence that I've inoculated myself against the future uncertainties of the market. Or somebody might say, oh, wow, I can swing for the fences because I can lock down that one and a quarter percent with Relationship between the money that they have and how they want to live their life rather than this abstract, well, what's your risk tolerant, Mr. Investor?”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“The next 10 years. Frequently. And that's part of it. But the bigger part is we go through this pretty brain cramping exercise of doing lifetime discount and cash flow modeling. When you do that and you derive from that process a present value calculation on your future anticipated and known liabilities and you compare that present value calculation against the assets that they have, you can derive a target after tax inflation rate of return. This is a big exercise. But by doing that, you can then say to the client, okay, given the assumptions that are in this model. Here they are. Here's our discount rate, and here's our rate of inflation that we expect. And here's how old your kids are. It's a pretty logical exercise. You can then say, we believe that you are after tax inflation target rate of return is one and a quarter percent.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“At that moment Then you just automatically enter this really strange world where you're not really sure what you should be doing. But that's one of it. In other words, what...”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, our experience is that that's not actually true. And here's why. First, we don't think that investors can articulate their risk tolerance in a way that is reasonable, and their risk tolerance shifts with market performance. In 2007, everybody had high risk tolerance. In 2009, nobody had high risk tolerance. And you can't flip portfolios. risk structure, risk bucketing effectively to map to the vicissitudes of the market.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“However, the way that we've chosen to structure our business was based on a question that the six founding partners asked ourselves if we were to hire a firm to manage our own capital, what would that firm look like? And we spent three years answering that question using a combination of partner capital and a residual business that we lifted out of Smith Barney for operating revenue to basically build the answer to that question. And one of the things we did right away was reject the notion of model portfolios. And as soon as you sort of go through that intellectual process of understanding why a model portfolio is exist, i.e. to optimize for the profitability of the asset management firm, not necessarily to drive for best solutions for your clients, then you realize. You can't use model portfolios.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, so it's been gratifying growth. And I think we can attribute that to a couple things I mentioned a moment ago that being based in Boise has been hindrance. It cuts both ways. We have had some families say to us they intentionally want to work with us because we're not from New York. They think that that leads to the capacity for independent thought, which I think is accurate. 100%. And we also have had some prospective clients who have said no to us because we're not from a financial center and they think that we're not going to be able to tap into sort of the sharpest and best thinking. So that geography cuts both ways. I think broadly it's been more of a hindrance than help.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“So, first of all, we have grown from a relatively modest beginning. We had about $400 million in assets under management in 2008. We launched in 2005 and spent three years basically building systems and capacity. Started marketing.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“It's the other center of the financial world. It's the beating heart of London, New York, Tokyo, Boise. Absolutely. It rolls off the tongue.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“It's a remarkable state, and I'm not getting paid by this Idaho Chamber of Commerce for this endorsement, but I chose to live there. It's been a hindrance in many ways professionally. Not a big fan.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Tunisia. Tunisia, as one does. And then France, and then England, and then Colorado, which is where I think of as my home. And I went back east to go to Andover and then Dartmouth. And then I lived in Australia for a while. And then I moved to Idaho, which.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“No, it was because the brokers were using asset one as an excuse to get paid on an account without doing anything. So what they realized was that brokers were converting commission-based accounts to fee-based accounts so they could basically ignore the client and still get paid.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“And it became the fastest growing account structure at Smith Barney nine months or so into that pilot project, they terminated it. Not because it wasn't working.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“I can't believe you asked that question. We did not prep for this. Yes, I did. I actually wrote a white paper to senior management where I said, look, there's these embedded conflicts of interest in this business model where you've got four primary revenue streams all riding on the backs of one or two consumer bases. And those embedded conflicts of interest are going to be revealed at some point. And here's one way to strip that conflict. And I suggest that an asset-based account rather than a commission-based account, they called it asset one.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“It's a sales position Correct. And it was a great experience for me just to really be in the belly of that beast for so many years. And along the way, I was tapped to join the leadership development program, which was really about finding guys within the firm that were going to move on to management. And so I got a two-year Crash course in big bulge bracket broker dealer management and at the end of it I was I stepped off that train and I said not only do I not want to be a manager I don't even want to stay here and it took me about five years to figure out how to exit in a way that worked for me”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, yeah. And I realized that as much as I am fascinated by and compelled by capital markets, capital formation and aggregation, et cetera, I just didn't really like the job.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“And I remember leaving at the end of that month thinking, wow, this is really not what I had expected. But I figured, well, I signed up for this. I'm going to kind of plug my way through it. And I got through the first six months and then qualified for the next level of training and went back to next level of training, thinking, okay, this is where this is where it's going to turn us into investors.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Teach us about asset allocation. And it was a month, and they had us in this hotel in Hartford for a month. And it was cold calling and scripting was all sales.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, just sort of personally. And part of it was my naivete when I entered the business. But I remember when I went back to training, my first training session. And in my imagination training was going to be learning how to be an investor and an advisor out. teach us how to the markets.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yes, it was a much smaller firm then. I think they had about 700 brokers across the country. And they had a small office in Boise, which is where I joined them. And not long thereafter, Sandy Weil went on his acquisition spree. And by the time I left, I think they had 10,000 brokers. And it was a relatively small division of Citigroup at the time. So when I joined them, it wasn't really a bulge bracket firm and it became one. And that journey was really disheartening for me.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Part of it was timing. I joined Smith Barney immediately following the Sheerson merger. So it was Shearson Smith Barney when I joined them. Pre travelers group, pre city group, Sandy Wilde wasn't even there”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“See, I would suggest that that's a market share capture strategy more than necessarily an investment methodology. And I may be cynical here. But I would. Suggest I would pause that gender diversification in the C suite is an important reflection of the culture of a company and it may, parentheses or may not in parentheses not be immaterial, may not be immaterial.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“That's the whole point. And what is baffling to me, and I think this gets to the cognitive biases embedded in Wall Street and the city of London, is why are there no copycats? Why aren't, I mean, think about”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Right into the mess. And what's beautiful about that is that it both allows an observer to discount their performance by saying, yeah, well, you know, they didn't have an exposure to carbon and they didn't have an exposure to predatory lending because that's not their model. That's the whole point.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“It's an open question. I've had that conversation with them, and I think they kept it at $10 billion when they started the firm because they didn't want to have asset growth be the primary driver for their business decisions. But I don't know.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“That's fascinating. It's fascinating. They do have a private debt fund. And I believe they do have a small private equity fund, but their core competence is long only global private equity.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Exactly. And that's why I think that the number could be even higher than 35%, because when we talk to asset managers and we talk to a lot of asset managers, it continues to surprise me how many of them say, yeah, you know, we're starting to contemplate that. We're starting to integrate that into our underwriting, for example, for fixed income. We're starting to integrate that into our analytic models around future discounted cash flows. You know, it's like that approach is no longer antagonistic to the notion of investing for financial return. Now, how deep it goes, there's only one firm that I'm aware of that does absolute sharp, sharp thinking around the materiality of ESG risks. And that's Al Gore and David Bloods from Generation Asset Management.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yes. And the reason I drew that distinction between sort of cultural applications at VSG versus the regulatory applications of VSG is that that determines how deep it penetrates an organization. I think that saying at this point that an asset manager is simply ignoring all environmental and social consequences when making an investment decision, I think that's an inappropriate assessment of investment methodology. I mean, even a firm that would be intentionally antagonistic towards the concept of responsible investing might incorporate some kind of climate risk modeling in the way that they think about doing their analysis of Oil and gas EP companies.”
2016-09-09 · Masters in Business · Interview With Matthew Weatherley-White: MIB (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source