The Story of Zoe Financial: How A Simple Bedtime Question Turned Into a Company
I wanted to reflect for a moment on how Zoe came to be, and why we do what we do.
We launched back in February 2018—and it’s been an absolute whirlwind.
At Zoe, we match consumers with independent, fee-only financial advisors. In just a few months, we exploded from zero to thousands of matches across the country. The traction attracted top-tier investors, great press (here, here, here), and talent. Yet, like all company stories, behind the scenes, it wasn’t an overnight success.
Actually… it almost didn’t happen
Actually…it almost didn’t happen. Back in 2011, I graduated from Wharton Business School without a job. After stacking up 15 rejections for roles in asset management, I did what any sensible 29-year-old without a job would do—I took off with my wife to the beaches of Cartagena, Colombia to recharge for a few days.
I was wearing a bathing suit in the back of a smelly taxi as we hurtled down the narrow streets of Cartagena when I got “The Call.” JP Morgan Asset Management wanted me to swing by their NYC offices to present for a role as a global market strategist. I’d soon be doing in-depth research on the economy and markets, and communicating the findings to our clients, who were financial advisors. Within 18 months, I went from Associate to Executive Director. The bank elevated me to spokesperson status; I did CNBC TV spots and was quoted in The Wall Street Journal on a weekly basis.
One of my favorite parts of the job was presenting to large audiences of our client’s clients—by which I mean regular, real, non-finance folks. I absolutely loved finding ways to explain complex topics—like the Federal Reserve’s quantitative easing—in a simple, clear manner everyone could understand.
After each presentation, I got pats on the back from people like Grace, who’d retired from Pepsi the prior year and had four grandchildren. Or Harold, who met his wife at his employer, General Electric, 20 years back and was now just a few years out from retirement. They shook my hand warmly and told me things like, “Thanks for that…I’ll rest better at night knowing my money is in good hands.” I remember thinking, I can see myself doing this for a looooong time.
So yeah, Zoe almost didn’t happen
So yeah, Zoe almost didn’t happen. Then I received an invite to present at a large conference in Scottsdale, Arizona. It was an internal powwow for 400 financial advisors at a large bank (which will remain nameless, you could substitute any of the major ones).
The stage was lit like a Beyoncé concert—though the people onstage were a bunch of slightly overweight, middle-aged men who’d once been star athletes in high school. I was sitting in the backstage area, waiting for my turn to speak. By chance, the agenda had their annual award ceremony lined up just ahead of my speech. A big, booming voice called out:
“The award for the Biggest Producer in the Mid-West Region is…”
“The award for Most Sales of Large Cap Growth in the East is…”
The voice droned on and on.
Finally, I turned to Stephanie, who worked in marketing for the bank and was sitting next to me, and asked, “What is a producer?”
She said, “Oh, they mean the sales force…you know…the advisors.” She had a conflicted expression of both disgust and pride—like someone who’d once truly believed her firm had a purpose, but now knew better.
I realized that I was witnessing the equivalent of doctors having an internal conference to celebrate which doctor had sold the most drugs to patients.
Now, there’s nothing wrong with the sales profession—this is about context. These people called themselves financial advisors to their clients and promised to help them with the most important financial decisions of their lives…but they knew they were really salesmen. The “production” numbers Mr. Booming Voice was giving awards for were someone’s retirement dreams, college fund, and savings to buy a home.
I tried to shake it off, but I couldn’t
I tried to shake it off, but I couldn’t. I’d seen behind the curtain. Not long after that, I changed roles. As a research analyst, I could focus purely on identifying investment opportunities for the firm’s institutional clients (pensions and endowment). I thought, If I’m not interacting with financial advisors, then I’m not part of the problem.
One night, as I was putting my four-year-old daughter to bed, she asked me what I did when I went to the office. I spent the next few minutes trying to convince her (and myself) that I was helping people with their money. She kept asking me, “But how?”
I couldn’t honestly answer her, since most of the professionals that were directly responsible for helping people with their money, the advisors, weren’t actually doing so. And the worst part was that I knew the average person couldn’t tell the difference between a capable advisor and a salesperson.
As I walked back to my bedroom a thought that would change my life crossed my mind: I know how advisors get paid. I know what a great advisor is supposed to do. What if I could help steer people to the right advisors…the advisors who have the knowledge, process, and incentives to actually help people with their money?
In my past work as a strategist, I’d encountered a minority of advisors who had a very different approach. For one, their incentives were better aligned with their clients—they operated independently, and weren’t compensated via commission for selling a product. The only person compensating them was the client. Some of those advisors also had more reliable competencies, having passed the rigorous CFA or Certified Financial Planning curriculum. Their focus wasn’t on picking stocks or mutual funds that would try to beat the market, but rather to deeply understand each client’s financial life in a holistic way.
These rare advisors took into account your taxes, insurance, budgeting, goals and fears, *before* guiding your investments. Basically, they were incorporating your whole financial life into your decisions. I started playing on the word life…vida in Spanish? Not quite. Wait a minute…the word zoe in Greek means life.
I was waiting to have “the talk”
By the time my wife woke up the next morning, I was waiting to have “the talk” about why leaving my high paying job to pursue this endeavor was such a great idea. It turned out to be a quick talk—my wife fully supported the decision. She believed in me more than I believed in myself…and I’ll forever be grateful.
I’d love to tell you I had an amazing, perfect road map of how it was going to play out. That’s not the real world though. Yes, I was excited, but I was also scared out my mind. The early days were really tough. It was just me with this idea and a lot of people (who happened to be benefitting from the old way of doing things) thinking I was nuts.
Many mornings, I woke up and thought to myself, “I’m married with two young kids…what the hell was I thinking?” Then I’d remember the other option was to go back to work regretting that I never took a stab at addressing obvious industry flaws—even though I had the knowledge and resources to do so. (See Jeff Bezo’s Regret Minimization Framework] for more on this.)
Fast forward to today
Fast forward to today and we have helped thousands of people with over a billion dollars in aggregate savings make the important decision of who they choose as their financial advisor. Our recent milestones have everyone—from our team to our investors—feeling excited, but we’re not patting ourselves on the back just yet.
For each person who has found a fiduciary advisor through Zoe, there are a million families being peddled expensive financial products every day by salespeople who dress up as advisors. It’s our mission to empower millions of Americans to make better financial decisions with the guidance of a highly competent fiduciary financial advisor.
Now, I look forward to answering the question my six-year-old asks me every day when I come home: “How many people did Zoe help today?”*All investing is subject to risk, including the possible loss of the money you invest. **The projections or other information generated by Zoe Financial, Inc. regarding the likelihood of various investment outcomes are hypothetical in nature, do not reflect actual investment results, and are not guarantees of future results.