#78: William Littlefield II (Wizest)

Can we find a way to make those financial experts that were normally inaccessible
more approachable and is there a way to sort of democratize access to them and the
solution that wisest represents is What if you could build your own team of
financial experts? Almost like it was fantasy football and invest directly through
them, so you wouldn't have to navigate financial markets by yourself, it takes stocks
by yourself. And if we can find a way to make that economically viable for
financial experts, which is what's so great about the wisest business model, then
it's a win -win for everybody. - Let's discover the Cleveland entrepreneurial ecosystem.
We are telling the stories of its entrepreneurs and those supporting them.
Ooh, Welcome to the Lay of the Land podcast, where we are exploring what people are
building in Cleveland. I am your host, Jeffrey Stern, and today, I hand the pleasure
of speaking with William J. Littlefield II. Billy is the president and chief
technology officer of WISEST, where he is helping to build a next -generation
investment trading platform that democratizes access to financial expertise. WISIS
recently closed on $1 .5 million in financing and was featured in Forbes as a better
solution to the problems posed by Robinhood. Billy has an eclectic background,
spending more than a decade training with various Olympic coaches and athletes in the
sport of ice skating, qualifying and competing at the U .S. Figure Skating
Championships as a single skater. Prior to WISIS, Billy spent a lot of time outside
of the world of software development, academically working to reconcile 21st century
technology, politics, and economics with long -standing concepts in philosophy, where
his recent research has been divided between applied ethics, social theory, and
artificial intelligence. Specifically, he has explored the ethics of technological
progress and its impact on climate justice and geopolitics. Billy earned a graduate
degree in world literature and philosophy from Case Western Reserve University here in
Cleveland, where he also received a degree in natural sciences with a concentration
in chemistry. I very much enjoyed this conversation spanning everything from how
wisest is working to democratize access to financial expertise, to Billy's path to
Cleveland, to digital nomadisy, to philosophy itself. I hope you all enjoy it as
well.
Billy, I've been very much looking forward to this conversation, perhaps unbeknownst
to you, investing and financial enablement are topics after my own heart that I am
personally very passionate about and genuinely really excited to see real innovation
coming out of Cleveland, making it year for folks to pull on those financial levers,
which historically have been siloed and inaccessible to many. So thank you for coming
on and very much looking forward to this conversation. Thank you, Jeffrey. It's a
pleasure to be here. And I have to say your own ideas have been after my heart as
well. I have long thought that the Cleveland community could use a cool podcast just
like this. And navigating entrepreneurship in Ohio in general has been a challenge
that I would have loved to have hear from more entrepreneurs about before I had to
do it on my own. So I think you're doing us a great service and excited to be
here. Oh, I appreciate that. I'm sure it will impact some of those challenges over
the next hour or so. Before we maybe dive into all of that as well It's kind of
the core focus of what you're working on at WISIS. I'd love to start with just
your own background, your path to Cleveland, your interest in entrepreneurship, and
maybe paint a picture of the threads that tie your career together so far.
- Absolutely. Well, I know that I have a relatively unusual path to the Cleveland,
Ohio area. I grew up in Dallas, Texas. I was originally born in Chicago to two
great supportive parents. Both were self -employed, which certainly left an impression
on me. But we quickly moved to Dallas when I was a young kid. And like most kids,
I grew up playing soccer and little league baseball. But one of the formative events
that happened to me as a kid was in 1999 the Dallas Stars won the Stanley Cup and
so every kid in the Dallas Fort Worth Metroplex as we call it wanted to learn how
to play hockey and so I began going to the ice rink with my parents to do hockey
classes and learn to skate classes and when I was there I was approached by a
coach to ask my parents whether or not I'd be interested in some private lessons. I
was one of the smaller, younger kids on the ice and I had a little bit of trouble
skating backwards, which I know that many people do when they're first learning. My
parents said, "Sure." But the caveat was he wanted to teach me half hockey,
half ice skating, and that decision ended up changing my life. So not long
afterwards, while I was a kid roaming around these ice rinks, there was an
interesting phenomenon that happened in Dallas at the time, which was this combination
of the economic prosperity there with all these new facilities started attracting a
lot of world -class coaches to the area to start in both on hockey and on ice
skating. And so I ended up getting pulled into the orbit of some Soviet Olympians
that began coaching in the area not long afterwards. And actually spent most of my
youth and teenage years training as a competitive ice skater and competing at US
nationals and doing that sort of thing. And that's actually what indirectly brought
me to the Cleveland area because there's only a few metros in the United States
where you can sort of train seriously as an ice skater. And Cleveland happens to be
one of them. So when university came around, that is what took me to Cleveland,
Ohio. Oh, wow. That's incredible. We'll follow this detour for a bit.
How did your ice skating career develop from there? Sure. I would say the most
interesting part from maybe an entrepreneurial standpoint was I think learning to
spend time training with these folks, it provided me a few key insights.
The first of which was that frankly there's nothing like a Soviet Olympic champion
screaming in your face that you're a spoiled kid to teach you what hard work looks
like.
So, I think I had the opportunity to learn some of the lessons of self -discipline
and high performance a bit younger than my peers. The other thing that was maybe
interesting was that something you learn when training in an individual sport like
skating, especially in acrobatic sport like that is one of the ways you can become
adept at that quickly is if you're just willing to throw yourself into the ground
when you're encountering a new trick or a new maneuver. So basically fail fast. It's
sort of startups 101, right? And that also imbibed in me a lesson about Basically,
being willing to take the hard path or take the unconventional path is a way to
both overcome my fears and also acquire a skill set more quickly.
And that ended up lending itself very well to startups in the long run. No,
I think that makes a lot of sense. And I'd love to, as we work our
interest in entrepreneurship. But I know, you know, the path perhaps wasn't a direct
one. And, and, you know, you traversed in the interim there through some, some
academia. How did you kind of navigate your own process coming out of,
of school and, and your, your own interests from there? Ah, yes. How did I get
from A to B here? How did I go from skating to, to the startups? Yes.
So not long after moving to Cleveland, I ended up having another pivotal event in
my life, which was I ended up having ankle surgery during my freshman year of
university, and that also ended up being a pretty important year in terms of my
skating career. At the time, it was 2014, so it was the Olympic qualifying season.
And shortly after having surgery, I was sitting at home in crutches with a cast on,
watching a lot of the people that I grew up with qualifying compete at the
Olympics. And so as I was sitting there doing some soul searching, that was the
first time I ever heard about a pitch competition. And so I was sitting there
feeling a bit sorry for myself, but I had certainly learned to get back up on my
feet after falling down training all those years. And so I decided that I wanted to
occupy myself by maybe embracing some of these pitch competitions that were being
held in the Cleveland entrepreneurial ecosystem. So that was my first exposure to
pitching a VC. And I had the good fortune of being one of those nerdy kids that
had played around with coding, building websites or video games in high school. And
so I naturally had an inclination towards maybe looking at software startups.
And that was sort of the first event which started pivoting my life from athletics
toward entrepreneurship. And so as we make our way to So,
democratizing access to financial expertise is really an ambitious vision.
I'm always really fascinated by where the founding insights to these kinds of visions
stem from. And so, I'd love to hear about the founding story of WISIS, what were
the questions that you were asking at the time, what were you trying to validate,
where did that vision for the future come from and who else was involved in helping
you work through this process? At the time I began looking at wisest,
the first thing I should say is what most entrepreneurs know is that it's really
the case that your first startup is successful. Just like everything else in life,
startups tend to have a learning curve And it's not necessarily a very forgiving
one, and entrepreneurs should probably do a better job of talking about more if
they're really failures than we tend to. Everyone loves to talk about the romance of
the idea or the glory of raising venture capital, but usually there's a few steps
before that that aren't so glorious. But I actually built my first startup in the
Cleveland area around retail flash sales. So that was a mobile application based
startup where the idea was that brick and mortar stores could send out a push
notification to anyone within a specific radius that said 30 % off the next 30
minutes only. And that was the first startup that I really pursued with any
seriousness and found co -founders and began the venture capital process but as with
many other entrepreneurs I faced some co -founder issues on that and eventually walked
away from that venture. So I decided I never wanted that to happen to me again.
I happened to be CEO of that venture and my co -founder differences were with the
CTO and so I thought boy I should really go learn how to be my own CTO. And so
I decided to spend some years in industry at Southwest Airlines and at Visa,
learning how to become a serious software engineer, learning how small or larger
companies scale software. So afterwards, I returned to the Cleveland entrepreneurial
community and let some folks know, that knew me when I built my first startup, that
I was interested in consulting or helping some startups with figuring out the right
approach to software for whatever idea they were working on. And so at the time,
I was helping out people like Bob Sofgo at LaunchNet over at Case Western.
And I was kind of the descriptor we were using with something like a developer in
residence. At the time, he knew that I had just left Visa.
And so he suggested to me, you know, there's this French guy that just came to
town that you should really talk to because he's interested in banking, but he
doesn't know how to write the software for a startup and he hasn't pitched VCs
before. And so I think you guys might compliment each other. And so that was my co
-founder Axl Thibone, who currently serves as the CEO of WISIST. I'm president of
CTO, sort of his right hand man and manage the engineering side of things. But we
sat down at Starbucks in Beechwood and he began telling me that he thought there
was maybe a way to scale financial expertise to a wider audience.
And the story goes something like this. So Jeffrey, imagine you have just gotten out
of school or really just imagine you have just begun working your first full -time
job, right? So something that most people learn by osmosis is that investing seems
to be an important part of their financial future. The next logical step,
at least the last five or 10 years, tended to be something like, okay, well, maybe
I'll download Robinhood and check it out, see how I get started. The problem is,
of course, you download Robinhood and a feeling that a lot of people experience is
okay, I have the app on my phone, but I Don't know how to pick stocks I'm not a
stock picker. I would just go for software engineering or or to become a lawyer or
doctor or something else Or or maybe this is just my first full -time job and I'm
still work I'm still in high school or something, but I just want to get started
invested, but I don't I don't know how to pick stocks so the next thing you might
do is Google financial advisor or financial planner, and the uncomfortable reality
you'll experience there, of course, is that those people don't necessarily want to
talk to you unless you have $50 ,000 or $100 ,000 in investable capital.
And then the final thing you might do is say, "Okay, well, how about some of these
robo -advisors, which have grown increasingly popular, Acorns, Weld Front?" And I went
down this exact same path myself, Jeffrey. And so when I was hearing Axl describe
what he thought were some of the problems in the ecosystem, I could see this same
narrative play out 'cause I had personally experienced that frustration. You finally
arrive with these robo -advisors and you get the sense that you're supposed to
deposit your money and go away. There's not really an opportunity to take your own
stocks or learn about what kinds of trades you're supposed to be making. It's not
so different from depositing your money in a money market account or something like
that. And many people that download Acorns or Robinhood or Coinbase are often
interested in participating in the stock market, having some agency over their
investments. And so the key idea with WISIST was, can we find a way to make those
financial experts that were normally inaccessible more approachable?
And is there a way to sort of democratize access to them? And the solution that
WISIST represents is, what if you could build your own team of financial experts
almost like it was fantasy football and invest directly through them, so you wouldn't
have to navigate financial markets by yourself. It takes stocks by yourself. And if
we can find a way to make that economic be viable for financial experts, which is
what's so great about the wisest business model, then it's a win -win for everybody.
Yeah, I know. The vision, I Vision, again, personally resonates quite a lot. My own
path to investing I found was a little atypical, but I think in retrospect, it kind
of brought me to similar conclusions, I think, to the ones that you just outlined.
But I was quite lucky early on in my education in middle school. I got to
participate in what the New York Stock held annually. It was like a virtual stock
market game. And so in sixth grade, I got exposure to the market as a 12 -year -old
in a way that it just, it really had me fascinated by the way that it worked.
And coming out of that experiment, you know, I had made fake money and it kind of
started my journey of learning about what the market is and how it works and
getting interested in all of the intricacies of what's actually happening there and
the strategies around it. But no, I think I ultimately found similar burdens to
entry for a lot of folks who are interested know that they probably should be
investing, but perhaps don't know the best way to start. And so I think this all
resonates very much with my own personal understanding of it as well. Absolutely.
And I think for everyone that I knew at university or just among family and friends
that was using an app like Robinhood very confidently, I had 20 friends or family
that were just afraid to get started, knew that they were supposed to be investing
or that it was sort of the prudent thing to do, and they wanted and even envy
those people that seemed to know what they were doing trading or following Wall
Street bets or people that seemed engaged with the community. They just seemed to
feel like trading was a little too complicated or intimidating. Some people even
found it boring, and So, we had to find a way to try and make it more engaging
and accessible than the current pair have done, and that's what we tried to do. So
again, it's a really big vision, like democratizing access to financial expertise.
When you were thinking about what does an MVP look like and going from zero to a
workable prototype, there's all these, I imagine regulatory hurdles that you have to
surmount working and building in the financial industry. There's the whole issue of
how do you inspire an engender trust in the folks who will be using the application
to invest. Really I think hard problems, probably harder than some other startup
endeavors. What did really is part of this process look like, you know,
actually building the product. I'm so glad you asked that, Jeffrey, because it is a
pretty provocative endeavor to go and try and build a new trading platform.
I have to tell you. So I, like so many entrepreneurs, was inspired by things like
the lean startup. And When I built my first startup in Cleveland,
I have assembled a prototype that I took to market on iOS and Android in about six
months with a small team. Conversely with WISIS, it's taken us almost a three -year
journey to get to market. And that is because starting a new trading platform is
extremely capital and regulatory and regulatory intensive. The difference between WISIS
and a lot of other new fintechs out there is while there are available social
trading apps where you can maybe copy the trades of your friends or see what some
experts are doing, a key difference with WISIS is that we actually execute your
trades. And that makes all the difference in the world, because if you're just
creating a stock market app where you can simulate trading such as the New York
Stock Exchange game you were just talking about, or you're just making an app where
you can learn from your friends about investing, then you don't have to worry about
these regulatory hurdles. But if you do want to actually execute trades in the way
that you can pick stocks or pick a portfolio of stocks that actually execute a
trade on stock exchange, then you have to get SEC approval. And SEC approval
requires you to file with the SEC, of course, run through many legal processes,
and you actually have to integrate with what's called a custodian broker dealer,
which is a firm that specializes in executing trades that are actually with the
stock market. So most mobile applications connect to one of those and then eventually
if they go large enough such as Robinhood has, then they'll eventually begin
replacing that software with in -house software. So the journey for us was complicated
as a direct result of those hurdles you were just referring to in terms of capital
and regulation. What it meant was that we couldn't realistically build an MVP of
wisest in the fullest sense that really executed on the core functionality,
the core vision, until we had SEC approval. And we couldn't get SEC approval until
we we'd raised capital, which meant we had to somehow justify to a group of VCs
that we were going to try and build a very thorny, complicated kind of startup
without necessarily having had a co -founder that had exited before or that had built
a similar fintech. We all had relevant experience, but it was still a tall order to
convince a VC that we were going to run through these obstacles. So what we ended
up doing with WISEST is we ended up building a free beta simulator. So we had a
beta simulator version of our application that mimicked all of the trading
functionality and much of the vision I had just outlined. And all it did is it
simply allowed you to participate in contests just as you've described with the New
York Stock Exchange, except you weren't trading real money. But what that meant was
was that we basically had to build a simulator product solely for the purpose of
convincing venture capitalists that we could actually execute on such an ambitious
vision. It turns out that this was quite difficult because instead of actually just
trading stocks and using back -end providers that could execute these trades and hold
actual accounts, we had to simulate all of that. So we had to write software that
basically simulated trades and simulated account transfers in addition to just creating
a mobile application. We had to basically we mock what our production backend would
look like. And so we ended up building an MVP that became much richer in its
social features, in its gamification features, in its market data than your
traditional MVP would. So the upside of that is our MVP looks more like a 2 .0.
The downside is, is it took us years to build. Right. It's always the catch -22,
I feel like, with raising capital to surmount the regulatory hurdle before you can
kind of get your first customer's revenue in the door. What was the vision that you
were painting for the VCs and what do you think ultimately convinced them to support
you and your team in this endeavor. - There are multiple answers to that question.
I would say first, the vision was straight forward in the sense that many people
were able to relate to the narrative that you and I just both said we empathized
with. They had kids that had this experience. They knew people that were friends and
family that also felt similarly intimidated by trading and investing, even if they
were successful venture capitalists themselves, they knew this was a common problem.
So that wasn't necessarily a tough set. The best value that my co -founders brought
to the table here was that they just had this world -class experience in relevant
industries. While I was maybe the only co -founder that was familiar with early -stage
startups or how to code, they had deep resumes in launching digital banking products,
working at large enterprise software companies like Amazon,
and some of them had attended MIT. And MIT has,
of course, one of the most famous alumni networks in all of investing, or venture
capital. And we were able to leverage that angel investing network to get our very
first small checks. But the real thing that ended up convincing additional investors
and sort of our first big breakthrough was when Carl Rossner,
the former CEO of eTrade, heard about WISIS and said,
that is an idea that's going to work. And so Carl has been on our advisory board
and has been a great supporter of the company in other ways. And once we had
Carl's seal of approval, that is when I think other people in the industry began to
take us more seriously. - One of the things I imagined that many of the VCs would
bring up in these conversations with you and then something we've already talked
about here is how much competition that there is in this space. You know, we've
already kind of mentioned Robinhood, some of the robo advisors, but it's really not
like a blue ocean scenario. I feel like anecdotally, it's almost weekly that I'm
learning about a new investment platform or having my friends who know I'm pretty
passionate about the space, send me different tools or startups to look at. How do
you think about the somewhat daunting task of differentiation in such a crowded
space? And then I'd love to also get your perspective and maybe work through
actually a few competitors specifically about how they've been structured and how
YZIST differentiates and really how YZIST is making money through this business model.
So I would say the key differentiator with YZIST is,
in a word, behavioral economics. It's basically that investing is a deeply
psychological psychological process. Obviously our emotions are wrapped up in it,
so much of investing literature, especially say value investing, warned about the
Charlie Munger, many of the the Wizards of Wall Street,
talk about how investing is more about temperament than it is about intellect.
And that's because money is so personal, of course. And how you invest it and how
you're going to plan your future are deeply personal. And they're they're emotional.
So one of the key insights with WISIS is that instead of just setting up a
intimidating quantitative trading platform or presenting you with a investing product,
say a portfolio or robo -advisor that meets certain metrics or criteria,
the key insight with WISIS is we want you to invest with people that you trust.
Find an expert on the platform that has a background you feel comfortable with that
explains their portfolio in a way that you feel like you can understand and get
behind it and that is investing in stocks that align with your values.
So we put the human connection front and center find experts that are resonant with
you and we have large profile pictures and detailed resumes almost like a financial
LinkedIn profile so you can get to know the people that you're going to be
investing with as you build your team of experts to invest through. So that insight
of trying to make investing more human because the feeling of investing is deeply
emotional and human was maybe our key differentiator And as a venture capitalist,
it's probably something you're also it's mentally familiar with. You invest in
entrepreneurs you believe in, not just business models, but teams you like.
So the human connection was resonant with the people we were pitching this to. In
terms of actually trying to compete with a lot of the other products out there,
you're be right. It's an increasingly crowded space. The other component of how we're
trying to address our market is many of the new fintechs you're hearing about, many
of the new tools, like I was just referring to, the social trading apps where you
can copy the trades of your friends. So often those are tools that complement some
apps that you might already have. If you're interested in a social trading app where
you can copy the trades of your friends, that probably means you already use
something like Robinhood or another trading provider. And you're going to add these
different tools to help you pick stocks or to help you build a community around
your investing as supplemental tools to the trading you're already doing.
So so many of these tools are aimed at people that are already active in the
market. But just like we began this conversation, for every one person you seem to
know that is very savvy on how to use all of the available investing tools that
are already out there, you know 20 friends and family that wanna get started but
don't necessarily know how. And so we're aiming for the 20 and everyone else seems
to be providing more and more tools for the one that's already invested. On the
building an expert network, you know, one of the things that I think is always
really important is the whole fiduciary responsibility, right? Like,
you know, fiduciary to a financial advisor, what being a board -certified licensed
doctor is to a doctor, making sure that they have your best interests at heart.
One of the things I've been really curious about, just learning about why this is
the work you're doing, is how you all have thought about digitizing fiduciary
responsibilities and vetting advisors and the process by which you're pulling people
together on the expert side to what are, I guess, the measures of accountability and
how you're thinking about that generally. - So I'm so glad you asked because this
was an idea maze we spent a lot of time on.
The first question about making sure we're recruiting qualified experts is relatively
straightforward in the sense that as long as financial services have been around
there have always been there's always been a desire to make sure that qualified
people are providing advice when comes to financial services and so there are already
many exams and certifications that I'm sure you've heard of like the series 65 and
series 66 the CFA Chartered Financial Analyst Program that provide credentials to
ensure that financial professionals have a certain degree of fiduciary understanding,
a certain degree of financial expertise. And they, of course, also often have lengthy
ethics components to those as well. That being said, obviously we would be a little
bit naive if we assumed that just because you passed one these exams, you are going
to necessarily have everyone's interests aligned, otherwise Wall Street would never get
in trouble. So the way we try and align incentives at wisest is we do a few
things. So the first is we compensate experts based on a few different variables.
Basically, each expert on WISIS is providing a certain portfolio model that you gain
access to when you allocate them to your team. When you add an expert to your team
because you've seen their profile, you like them, you trust them, you want to invest
in the same things that they seem to believe in. And so you decide, okay, I'm
going to invest 30 % of my portfolio with Jeffrey. Well, the next thing that we
provide to you is Jeffrey is also going to have a risk return and user satisfaction
score. That user satisfaction score is exactly what you'd expect from something like
an Amazon or Airbnb review. It's one out of five stars and it's how well Jeffrey
seems to be communicating with his investors is whether or not he is continuing to
apply the sorts of models and principles that got you interested in him in the
first place and then the risk and return components we tweak to ensure that what
experts get compensated on is on having high user satisfaction with low risk.
So we actually will adjust an expert's compensation and reward them for having good
user reviews and for having lower risk portfolios. We multiply those variables based
on the actual number of dollars that are allocated in Jeffrey across the whole
platform, so it's kind of assets under management. But Jeffrey is always going to be
mindful of whether or not he's satisfying his users and whether or not his risk
rating is within a reasonable bandwidth that it's not going to negatively impact his
overall compensation too much. Got it. So I understand how I would make money as an
expert here educating on the platform. How is it that WISIS itself is making money
through the platform? - So we charge a straightforward subscription fee.
After doing a lot of user surveys, we looked at many of the different options for
how you would charge for an investment trade and platform. The old school way of
doing it, of course, was to charge a kind of transaction fee. And this is exactly
what the earliest platforms like eTrade did, is you would have a commission on the
trade. And we explored that model, but after speaking to many users,
so many of them told us, you know what, I would rather just have the peace of
mind of knowing that this is going to cost me a certain amount of money per month
somewhere between you know something like Spotify or Netflix that I don't have to
worry about in terms of every time I trade I'm going to get charged. I would
rather just know that this is going to be a line item that I'm comfortable with.
I've accepted that this is going to cost me about as much as a lot of the other
subscriptions I use and What we do at WISES is we take part of that subscription
fee and, of course, use it to build a platform, add new features, promote new
experts that you might be interested in, and then we take a slice of that, and
that is what we use to compensate those experts. So we're using a subscription model
based on the idea that most users of mobile apps today just feel a greater comfort
level with that model. - Yeah, and I think that's obviously in stark contrast to the
Robin Hoods where when you don't necessarily understand how the company makes money
and that all of the transactions are free, it's ultimately that you and your data
is the product that they are selling, right? - Yeah, paying for order flow.
So that, of course, has been under tremendous SEC scrutiny. There will be,
I think, an ongoing question as to whether or not that will remain legal. I think
that most people find it ethically uncomfortable. It would be nice with putting it.
But, you know, a commission -free trade isn't really free if you're getting charged a
kind of arbitrage fee because someone purchased your order flow.
- Right, so I guess just kind of taking stock of where the company is today,
having secured the financing, making your way through the regulatory maze that you
have, you know, where is the company today? How are you thinking about the next
year and change? And what has you most excited about that looking forward.
- Of course, well, the most exciting thing that we have on our agenda, of course,
is taking the WISES from the beta simulator, which we ran for about six months. And
we have now finally walked through all the steps of SEC regulatory approval to begin
sharing the WISES product beyond our internal stakeholders. Basically, we're going to
be having a launch party sometime in the next 30 to 60 days where we get to share
this product we've been working on for the last three years with the whole world.
What were the biggest insights from having set it up in such a way that you had
users but that it wasn't real money? What were some of the things maybe that
surprised you that you didn't anticipate going into that? So,
we had many surprises during the beta launch that were useful.
The first of which is that many people probably think that they approach investing
from a highly analytical, logical point of view, or maybe even a selfish point of
view in the sense that The only thing they're interested in is returns, right?
I want to invest my money in the way that makes me the most money back But one
of the things that we learned during the data was that it's just not true that
everyone thinks that way many people are willing to Make a little bit less money on
their investments If they feel like they're investing in products which are less
risky that have less downside risk. Obviously, something that many people are mindful
of right now. There's also the fact that many people really want to invest with
people that have a portfolio aligned with their values, right? This is ESG.
Many people are willing to invest in ESG portfolios, even if they don't think it'll
necessarily outperform their NASDAQ, because they think it's the right thing to do.
And that's a totally valid point of view. The other thing is,
is that people frequently want to invest with experts that they like. For example,
Jeffrey, obviously, we're both sitting here on this podcast as proud Cleveland here.
So what if I told you that one of the top performing portfolios is maybe from a
Cleveland State alum, more a case -west journalism, that's something you might be
interested in, or someone from your alma mater, Cornell, right? Yeah. So,
there's just all these different touch points with investing that are not just this
quantitative dashboard you see with a lot of the trading products out there. And
many of these factors ended up being things that our beta users told this, "Hey,
put this more front and center. I want to see the profile picture of this financial
expert before I see their performance chart. I want to know what they're all about
before I decide whether or not I even care about how well their portfolio is
doing." So that was an insight. Another key insight that we had that we got really
excited about was if you look at a lot of these investing products.
They are boys clubs. Investing has long had a notorious gender problem and one of
the things we found with the beta was that something about the team building aspect,
something about our approach to wisest was drawing a 60 /40 split women to men.
So we were seeing a very different demographic that was joining the data and
interested in the platform, then users on Wall Street Bets or users of Robin Hood
and Coinbase tend to see. And so we were very encouraged by that, knowing that many
people and that obviously with many professional women clearly aren't finding those
products to be as approachable for them as WISIS seems to be.
That's that's fascinating. I think that that kind of aligns with you know, what you
were mentioning earlier how In a lot of ways investing maybe is less about intellect
and an optimization of returns and and has a lot more to do with that Psychology
your own, you know risk temperament and that you know, it's it's one thing to I
think to read About and try and learn about the the market. But I think in
practice, it's always better to learn in practice than it is in theory.
Until you have money in the market, experience your own biases, financial psychology,
tolerance for risk, and outlook about where you want to deploy your money into
things that align with your own values can be theoretical. I think that's really one
of the cool things about what you're doing and trying to just get people to start.
I think that makes a lot of sense. I appreciate that, Jeff. We hope so, too. We
think that just knowing another human that you can talk to and learn from on the
other side of this equation simply makes the whole process a lot more approachable.
We've covered off two
that I've kind of picked up from why is this about empowerment and education, but
the third kind of core tenant there is about enjoyment. And so I'd love to
understand how where gamification comes into the equation here. And as you're thinking
about that, how ultimately you are thinking about success and growth in relation to
that gamification concept. So the gamification piece is something that we're quite
excited about because we think we have found a way to avoid so many of the
pitfalls that these other trading platforms fell into with gamification.
The biggest problem that many of them had was often rooted in simply how they made
their money, right? We make our money from a subscription model, straightforward,
flat. So we have no incentive for you to trade more or trade less. But of course,
so many of these platforms that were doing the commission free quote unquote trading
were making their money by selling your order flow and letting someone else charge
you a tax further down the pipeline. And the behavior that that incentivized for
them was that obviously if you're selling order flow, the more orders you have,
the more you have to sell. So they began just as a result of those incentives to
motivate people to trade more. And so all of their engagement was often based on
active use, on how many transactions are you conducting per day,
and how often are you checking your investments? Pretty much the opposite of what
every prudent investing book will teach you to do.
Make smart investments that you trust in and let the market do its magic of
compound returns and then don't worry about trying to be a penny trader or trade a
penny stocks or trade in volatility or again a lot of those sort of risky
strategies that we know can be particularly turbulent for for newer investors.
So with WISIS because we don't have that incentive problem we can think about trying
to make gamification actually aid you in being risk averse or in managing your risk
in an appropriate way for your portfolio that's suitable for your risk tolerance.
The way that we do that is instead of trying to encourage you to trade more,
we try to use gamification to help you pick investments that are best suited to
you. So one of the ways that we do that is every expert on the platform.
You may have been wondering, "How do I find these experts?" Well, one of the ways
that you can find them is that every single expert is organized into a totally
transparent leaderboard. You can just see top to bottom who,
which expert on WISIS is doing the best for the quarter, for the month, for a
three -month period. As we've added experts to the platform, we're building out
actually a whole leaderboard engine where we're starting to organize these experts
into different kinds of "leagues" where you have, here's all the experts that have
renewables portfolios. Here's all the experts that are targeting minority owned
businesses. Here's all the experts that trade in high growth technology startups and
giving them each their own leaderboard so you can then go in and see who's up for
the month, who's up for the quarter, who's up today. And that gives you, again,
just an immediate intuitive, you don't have to do the research on the actual stocks,
you don't have to go on young finance and see what the volatility is for this
particular stock or look at any of the market data to find out which portfolio
makes sense for you. You can just see on the leaderboard who's up and who's down.
Anyone can understand that. It's probably one of the first UIs in the trading app
that a five -year -old can understand.
So you can immediately see through the leaderboard what's going on. And again, it
provides a degree of intuitiveness through gamification. So we use for the
gamification feature to make the app more intuitive. The second way that we are
using gamification is we're also celebrating these different kinds of financial experts
by trying to promote different experts through different kinds of contests.
So you can see which expert was maybe the best performing female expert on the
platform for the month. And if so, then we're gonna highlight her. We also have the
opportunity to promote user performance. If you wanna share your details on why is
this, you can enter into different contests with your own team. No different than
fantasy football where you pick a team of experts and you see whose team is scoring
the most points who's performing the best week to week month to month and you can
do that on maybe a regional basis and also with your friends. So again this isn't
about trying to promote speculative trading strategies it's simply about trying to
make trading more fun and engaging for you. And it's also about trying to help you
find experts that fit the investment criteria you're looking for.
- You know, speaking of financial psychology and risk and people's tolerance for it,
I think I would be remiss if I didn't ask about, you know, building wisest here
through arguably the most severe market conditions, certainly since the Great
Recession, but even in many quantifiable ways since the Great Depression, the stock
market crash many years ago, I'm curious your thoughts,
observations, reflections, and navigating the market that we're in now when people are
maybe at their most pessimistic about being involved in the market.
In terms of trading platforms as a whole, if you look at the entire FinTech sector,
yes, I would have to agree, no doubt that investing apps and FinTech in general is
probably seeing some of this pessimism directly be through in just their customer
behavior, their customer acquisition, but I don't think anyone doubts that fintech is
not going to be the way of the future. That even if fintech is taking a hit
because the whole market is taking a hit, clearly fintech is going to be a strong
market, strong sector, strong industry as we come out of this recession. And where I
guess we're not quite technically in recession yet. What we'll call turbulent markets
for now. I don't think we've quite hit that second GDP indicator yet, have we?
The upside for wisest is that this is precisely the kind of scenario that it would
of course be nice to have a human coach guiding you through a market downturn.
If you had the option to be trading on Robinhood, or if you had the option to
have financial experts coaching you through this downturn, saying, "Hey, here is how
on adapting your portfolio to meet the different obstacles that are upcoming in the
market. And here is how you need to set your expectations for what the portfolio is
going to do. Would you rather have that or would you rather be on your own?"
Right. No, I think the dynamics here lend themselves quite well to the model that
you all have in place. The human touch, I think, is one that's sorely missing in a
lot of, not just even fintech, but many of these platforms today. I couldn't agree
more. In terms of the venture capital market, I definitely have to say that we're
lucky to have raised with some terrific partners and we're not in a situation where
we're going to run out of capital anytime soon We've been able to navigate all the
way to this point with a relatively small and distributed team and so Since we did
have all those years to build out the platform before getting the chance to really
take it live We're not in the same rush that maybe some other products are to take
take a limited MVP and get out features that are the intuitive next steps,
we have many of these features beta tested and built out in a more full -fleshed
way than most startups do when they're taking the first product and market. So I
know outside of WISIS, you have really kind of a breadth of interests, many of
which I wanted to ask you about. I know we're running a little up on time here,
but I think all really related in a lot of ways to the entrepreneurial journey and
the way the world is changing today. But maybe just a brief pass on some of these
detour topics. But I know you, in parallel to all of this, have an interest and
background in philosophy and have thought specifically about the intersection of
entrepreneurship and philosophy and it just frankly sounds really fascinating to me
and I'd love to understand how it is you're thinking about those things. Yes.
Thank you, Jeffrey, for inviting me to the conversation. That's absolutely true. I am
a philosophy nerd. I love to speak at philosophy conferences and participate in the
philosophical community. And I love to ask big questions and certainly incorporate
philosophy into the wisest prior to or for I can't. So for example, our first
version of course is named after Heraclitus, the philosopher most famous for change
and dynamism, and of course being for a group. And so it was fitting for or first
version of the product. But philosophy, I think, is a perspective which encourages
you to be skeptical of foundational or orthodox views.
Basically, I think if you are coming from the perspective of philosophy, you go very
comfortable with the idea of asking skeptical or credible questions about maybe
something that seems to be a very established idea and so that might be in
philosophy that might be what is the right theory of justice but this a similar set
of skills or at least a certain kind of skeptical mindset can be brought into the
question of not just what is a good theory of justice, but what is a good theory
of finance? What is, and just this willingness to try and reason for yourself from
first principles about the right way to approach a problem, I think is so similar
in entrepreneurship and
And when you are starting a company as an entrepreneur, so frequently you have to
have the audacity to look at maybe a very established industry and think to
yourself, even though there are tens of thousands, if not hundreds of thousands of
people all employed working on this status quo product, is there a different way to
do this that I can arrive at by just sort of thinking about it from first
principles? Are there new tools or technologies which have made new options more
attractive that are more feasible before? And it's very similar in philosophy where
you take maybe a long -held theory about the way the world works and you ask
yourself, is there new insights from human psychology or from political theory that
tell us that maybe this sort of foundational view could be improved.
And the willingness to reason for yourself, the sort of famous charge from Emmanuel
Kant to dare to know, dare to think for yourself, separate - Right,
I think central to both philosophy and entrepreneurship.
- Yeah, no, it's interesting here you talk about that because I think the way that
I've kind of pieced together the life cycle and trajectory of a lot of businesses
is often that the business that a company was founded on is not often the business
that a company succeeds with, right, and there's a it and learnings that happen
along the way. In a lot of ways, the overlap and maybe philosophy and
entrepreneurship is about truth -seeking in a lot of ways because I feel like much
of startup success is simply trying to stay alive long enough to continue to ask
more questions. As long as you're asking questions and learning, you're typically
making good progress as an organization. I completely agree. I think they're both
about trying to find, as Elon puts it, the signal in the noise.
Yeah. That's very cool. Definitely a bunch of threads I'd love to pull on there,
but I'll turn our attention to digital nomadisy,
which I know is something you've been practicing yourself. It's obviously something
that I think societally, a term maybe that folks didn't even know two years ago and
over the course of our familiarity and comfort with working remote and being remote
is something maybe that societally we've been exposed to. But I'd love to get your
perspective on what it means and how you've gone about it and some of the insights
that you've gained from doing it. Yeah. So I'm actually talking to you from Las
Palmas, Gran Canaria, Jeffrey. And right now, if you go to Nomad List,
which is probably the most popular platform among digital nomads, Las Palmas happens
to be number one for Nomads right now. So it's a popular spot and it's got a cool
community of people that are passing through from all walks of life. But I actually
began working as a digital nomad actually a couple of years before the pandemic.
It might have been actually just about a year. But the beauty of being a digital
nomad is I find it teaches you that if you can't take something with you,
it's probably not that important.
It's either the kind of thing that will be waiting for you when you get back,
or maybe it's something that is a material possession that was...
Once you got on the road and had to live from a suitcase, you realize it was nice
to have, but maybe isn't necessarily something that made you feel like you were
making progress or something that you needed to continue better in your life. So it
pairs with a kind of minimalist lifestyle. The other thing that being a nomad
teaches you, I think, of course, is it's a kind of rapid course in neurodiversity.
You get to obviously explore so many different cultures and rapid succession and it
keeps you constantly moving and thinking about the next thing. And the fun part
about that is the things that you keep taking with you from place to place,
when you're constantly changing locations, the things that end up staying the same,
are the same projects you're working on. The same things that you're trying to
build, the same ideas that you're tinkering with, that's what ends up staying
constant. Those end up being the anchors in your life. And that's what I meant by
a thing, you know, if you can't take it with you, it's probably not important.
Well, these things that give you purpose or a sense of identity or a sense of
place, the ideas that you have or the things that you might be trying to work on
or build for yourself, those are the things that end up being what anchors you.
What I find is that, of course, when you're at home, so many things so easily get
in the way of that story that you're telling yourself about the things you want to
pursue or the things that you want to work on. It becomes just incredibly easy to
find distractions in the way of chores or remodels or maybe committing to activities
that
take a lot of time but maybe don't get you any further to your goals or maybe
aren't even necessarily something you're doing because you enjoy it but it's maybe
sort of a kind of obligation. So being a digital Nomad is is meditative or or or
it allows you a kind of clarity of mind. It's for one just fascinating to hear
your perspective on it that kind of may close out that that thread with you know
how you think about it from a company building perspective and the the kind of
culture that they're able to build around you know really being fully remote?
I would say it ended up being a strength for us at the beginning of the startup
because by the time that Silicon Valley and venture capital started going remote,
we had already been working remote as a team for a while. And so as a direct
consequence of that, we were maybe more prepared to pivot to the remote world than
other startups were. The aspect of trying to build a team and a culture I will
admit has been challenging in ways. I would say maybe the most challenging for me
personally was so much about really early stage startups.
I mean truly first steps is about the camaraderie of building that MVP in a garage.
It's almost like starting a band and you have to have that kind of intense
brainstorming, a kind of intimacy with your co -founders where you are willing to
maybe work harder and longer at a problem than you would if it was just any other
task at work. And so the option to do that in person also gives you the
opportunity to build this kind of extremely profound trust in your co -founders that
is going to allow you guys to, or allow ladies and gentlemen,
to walk through a bruising process of building a new company.
And so it can be difficult to form those bonds remotely, but the truth is,
is that every other company that was a startup had to face these same hurdles as
we did. So that was reassuring in the sense that even if we were struggling with
trying to push through the difficulties of the pandemic and push through the
difficulties of working remote. Even if we had the difficulties of not having that
same garage band intimacy that is so much part of the romance of an early startup,
every other person was also going through that same event with COVID.
And so it wasn't as if the odds were stacked against us, or if it wasn't as if
there was an alternative to us working together easily in person, or pitching in
person. So simply knowing that all of humanity was kind of collectively going through
this with us made it, while still complicated,
it made it clear that some other companies are going to make it through and we can
too. I'll tie it back here from the world of remoteness and digital nomadicity to
Cleveland specifically for our closing question, which is for not necessarily your
favorite thing in Cleveland, but for something that other folks may not necessarily
know about a hidden gem, if you will. - Boy, that's a tricky question.
I feel like you've had enough guests where I'm worried I might not have something
so hidden after all. So I would say the thing I maybe missed the most from
Cleveland that has a special place in my heart is the Providence Cafe at the
Cleveland Museum of Art. I wrote many papers,
many theses on philosophy in the cafe at the CMA and also built many pitch decks
there. And it's just one of the best places, I think, in the Cleveland Metropolitan
area to go, have a coffee, feel inspired,
and get some Mm -hmm. Well, I think despite your your fears there that you have a
novel one that that is such a great spot Have you been there? I have yes. Yes.
It's quite lovely. Yeah, that's right I'd imagine it inspires the the kind of
thinking that that you would be doing there Well, I'm glad you know it and Yes,
I couldn't recommend it more if you're looking for a place to to think of a new
startup or even write some code on your current one. - Yeah, well, Billy, I really
appreciate you coming on in your time today and telling your story and the work
you're doing at Wisest. Again, just personally really excited about what you guys are
doing and wishing you all the best. - Thank you, Jeffrey. It's been an absolute
pleasure. And thank you to all of the listeners out there in the land.
- Yeah, yeah. If any of those listeners had something they would like to follow up
with you about, what is the best way for them to do so? - We can be contacted at
infowises .com if you wanna ask us a direct question about the company. If you're
interested in following up with me personally, I'm available on Twitter at
WJlittlefield2, since I was named Lim Jlittlefield second.
And certainly on Instagram as well, where I have a link tree to other articles
about philosophy and and even a couple clips of triple axon. Oh,
that's awesome. I wanted to check that out. Well, Velie, thank you again. Really do
appreciate it. Thank you, Jeffrey. Cheers.
estment
decisions. Thank you for listening and we'll talk to you next week.