Thrive Global Interview with Curated's Managing Partner on Smart Investing Strategies

Read the Thrive Global Article published on September 23, 2019 by following this link, or viewing it below.

I wish human beings could stay grounded in complexity, but also happiness. I love the kindness movement that I see in the world lately. The industrial age brought forth so much ugliness that the technology age amplified. If the pendulum could swing back into happiness, that would be amazing. 

I had the pleasure of interviewing Jessica Higgins, JD MBA BB, of the Research & Innovation Institute.

Thank you for doing this with us! Our readers would like to learn a bit more about you. Can you tell us the “backstory” about what brought you to the finance industry?

I began in management consulting, working with the leadership of major corporations to improve service delivery models through people and operations management. My background in psychology and behavior change led me to develop science-based models for implementing marketing within organizational design to improve revenue. This was fairly novel at the time, but I was essentially studying hypergrowth startup companies and creating an ROI model for large corporations to feel safe implementing their best practices.

I realized that the pace of change in large companies is too slow for me, but that there is a formula that can be applied to grow any business, so I shifted toward startup business development.

This led to me creating a fund of funds so that I can passively invest in a selection of promising small businesses through my hedge fund and take an active advisory and investment role in a selection of businesses through my venture fund. After the success of venture fund I, I’m currently working through the development of venture fund II as well as deploying capital into a new vehicle which will become fund IV. It feels like starting all over again from the beginning, but I guess that’s life.

Can you share with our readers the most interesting or amusing story that occurred to you in your career so far? Can you share the lesson or take away you took out of that at story?

As a woman in a largely male-driven career trajectory, being undermined and undervalued is par for the course in corporate America. Funny enough, however, in my first month in finance I was nicknamed The Dominator. The culture of finance only sees results and the consistency of them. For the first time in my career, being female seems to amplify the results I achieve, like, I somehow get more respect for my abilities.

Are you working on any exciting new projects now? How do you think that will help people?

The underlying mission behind my work is to help businesses grow in order to help people prosper. Small businesses are the backbone of our economy. They represent the overwhelming majority of all jobs in the United States, and yet traditional finance is terrified to fund them.

Technology has evolved so rapidly that it allows for unconventional insights in finance that can create job growth, if you’re willing to step outside of the boxes of convention. We are living through an extremely exciting period for humankind, in my opinion.

Ok. Thanks for all that. Let’s now jump to the main core of our interview. According to this report in Fortune, nearly two-thirds of Americans can’t pass a basic test of financial literacy. In your opinion or experience what is the cause of these unfortunate numbers?

Finance — like many other sectors I have worked in — is largely in the business of information arbitrage. Insiders selling the concept of proprietary knowledge to outsiders. Digital currencies were the first use-case for the democratization of finance, which is why so many innocent people were scammed. I believe that people want greater financial knowledge and opportunity, and that technology will deliver it as soon as the regulatory environment can understand how to adapt. I feel that our regulatory environment is well on its way through a process of democratizing finance now, and that our collective knowledge is about to improve greatly. Future generations will have more open access, which will lead to greater financial literacy.

If you had the power to make a change, what 3 things would you recommend to improve these numbers?

1. For as much as I value the diversity of our country, I would love for there to be a cohesive American culture that is focused on continuous learning and collective progress. I have experienced the two Americas that exist now: some of the greatest cities of the future, and a remainder of this country left in the past. You can bring an internet of information to any civilization but you cannot make them adapt. I wish I could collectively change the mindset of the antiquated American. Nothing is possible until you are able to adopt a mindset of possibility.

2. I am excited to change the collective opinion around RegCF and other platforms that the average person can participate in, i.e. the world outside of accredited investing.

3. The business of credit has bankrupted this country. Most people are hopelessly in debt, and they aren’t wrong. If credit companies called in their debts, the U.S. economy would collapse. Consumer finance is so broken; if there was a debt reset button, I would love to press it.

Ok, thank you! Now to the main question of our interview: You are a “finance insider”. If you had to advise your adult child about 5 non intuitive essentials for smart Investing, what would you say? Can you please give a story or an example for each.

1. Never mistake popular opinions with accurate ones. Look at the housing crisis and tech IPOs if you need examples as to why.

2. Know what you don’t know, and know when you do know. I learned this as a law clerk for the wealth management firm of Southern Wine and Spirits, the largest privately held company in the US (at the time, at least). The managing partner pointed out the two main fallacies of humanity: when people don’t know things but believe they do, and when people do know things but don’t believe they do. It takes a ton of practice to perfect this skill.

3. Humans are emotional decision-makers. We love to pretend that we are rational actors but cognitive science has disproven this theory. You are functionally incapable of making a rational decision, while computers are functionally incapable of making an emotional one. Trust sound data created by sound technology to a far higher degree than you trust even yourself.

4. Diversity. While the diversity of a portfolio is an obvious step one in finance, the diversity of ideas is often unconsidered. Gather as much radical thinking from informed outsiders as you can. This is where innovation comes from, and so it should be the backbone of financing those businesses.

5. Employ your core values with your financial decisions. Money is fungible; how it makes us feel is not. Often, the decisions you make that lead to the best altruistic outcomes can also have greater gains financially, but they will certainly create more happiness.

None of us are able to achieve success without some help along the way. Is there a particular person who you are grateful towards who helped get you to where you are? Can you share a story about that?

I am endlessly grateful for the collaborators in my circle of influence. As a firm believer that you are who you surround yourself with, I take extreme care to ensure that every member of my community is someone who inspires me. So to all of my friends and colleagues: thank you, sincerely.

Can you please give us your favorite “Life Lesson Quote”? Can you share how that was relevant to you in your life?

“Find value in unexpected places…by thinking about business from first principles instead of formulas.” — Peter Thiel. My father was an entrepreneur who wanted me to be successful by teaching me to question everything. This was never codified into the concept of First Principles Thinking until Elon Musk. It is the foundation of every decision I make.

You are a person of great influence. If you could inspire a movement that would bring the most amount of good to the greatest amount of people, what would that be? You never know what your idea can trigger. 🙂

I wish human beings could stay grounded in complexity, but also happiness. I love the kindness movement that I see in the world lately. The industrial age brought forth so much ugliness that the technology age amplified. If the pendulum could swing back into happiness, that would be amazing.

Thank you for the interview. We wish you continued success!

— Published on September 23, 2019

Jessica Higgins