It’s a marathon…filled with a million sprints. It will take longer than you think, at least for the overall picture. You start out with this idea, and just want to see it out on the world. But to get there, you have work like mad, over and over again. It can be frustrating and discouraging and absolutely thrilling. You have to just keep going, and find your pace. There’s no magic spell to get to you where you want to be. All magic is just hard work.
As a part of our series about business leaders who are shaking things up in their industry, I had the pleasure of interviewing Eliza Arnold.
Eliza is the COO and Co-Founder of Arnie, an automated portfolio builder for the ethical investor. Before entering the world of sustainable finance she lived in blissful ignorance as a creative and writer, creating campaigns for some of the biggest companies in the world — winning awards from Cannes Lions, the Shortys, and Brandweek. Then while working on a social impact campaign she found out her investments were supporting companies she was opposed to, and well, here we are. She is now committed to bringing the values of conscious consumerism and investing to everyone, using the power of shareholding to shift the focus to stakeholders.
Thank you so much for doing this with us! Before we dig in, our readers would like to get to know you a bit more. Can you tell us a bit about your “backstory”? What led you to this particular career path?
Thank you so much for having me! To start us off, I should mention that I’m one of the luckiest founders out there — I get to be on this journey with my sister, Izabel. Our backstory is both deeply connected, and extremely different. Izabel has a very traditional finance background, and Eliza has a creative and advertising background. We know each other better than anyone else, but we come at things from very different perspectives, which is a big part of why we work so well together. I was a writer at a creative agency, where I made commercials and brand campaigns for some of the biggest companies in the world. Although it’s not a standard path, it’s actually been an extremely useful background for building a company. Creative agencies are there to solve business problems in the most creative way possible, so this training to constantly approach issues with different thinking is completely necessary for a startup.
But, you also need to have a deep understanding of the one problem you’re solving, which is where Izabel comes in. She was an investment banker turned investment advisor, where she managed over $1.5 billion in institutional and ultra-high net worth client assets, spending much of her time mission-aligning portfolios. The impact was significant, but it left her thinking about the 95% of American households who couldn’t afford the minimums and fees to work with a private advisor like her. At the same time, while working on an anti-gun campaign I had just done an audit of my 401k and found out I was invested in gun manufacturers. It was a shocking realization to say the least. I felt like I had no control over where my money was going. So we started talking about this problem, A LOT. And then the idea for Arnie was born — a new robo-advisor that lets you align your investments with your values. A platform that combines the customization of a personal wealth manager with the affordability of a robo-advisor — making sustainable investing accessible to all.
Can you tell our readers what it is about the work you’re doing that’s disruptive?
We are changing the way people invest their capital, marking a shift towards accessible impact investing. We build customized individual portfolios that will invest your money in companies making a positive impact and solving the global problems you care about, and divest from companies causing harm. Finally breaking down the exclusivity and giving everyone the ability to hold companies accountable for their impact — shifting the focus from shareholders to all stakeholders.
But previously, to get this level of ethics and sustainability customization you’d have to meet the high minimums to work with a personal advisor — a threshold that 95% of American households can’t hit. Arnie is democratizing access by making it all automatic and algorithm-driven, so we can keep account minimums and fees low. Unlike other robo-advisors, we build the equities allocation of someone’s portfolio using direct stock ownership, instead of just funds (users have no control over what they own in a fund, which means they can’t customize). In essence, Arnie is building each user their own customized fund- this is all possible now with innovations like fractional share trading and index optimization, which other robo-advisors aren’t utilizing. Portfolios are designed to deliver the expectation of market-rate returns, so you don’t need to sacrifice financial goals for sustainability values. For the first-time, people at all income levels will have access to personal advisor-level customization in a matter of minutes. This is the power investors were always meant to have, but until now haven’t had access to.
This all starts with education though. Most people are unaware that if they’re invested in an ETF or a mutual fund, chances are they own companies that have practices they disagree with. So while we’re still pre-launch, we created a free tool that will tell you how sustainable your current investments are. Just enter your fund name or ticker and discover if you own companies that are high fossil fuel emitters, weapons manufacturers, or lack board diversity — among other issues. Our goal is to give everyone the information they need to hold companies accountable for their impact, and find out where their money is really going.
Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lesson you learned from that?
When you first start it can sometimes feel like you just jump from mistake to mistake. Of course that’s not actually what’s going on, but there’s so much running around in the dark you can’t always see when you’re succeeding.
Early on, we submitted a video of us talking about Arnie for an application. We’d written scripts, practiced it over and over to try and make it feel effortlessly unpracticed. And then recorded almost a dozen times until we were happy with it. We uploaded it, sent the link, and then checked it one last time. And there it was. A leaf. Stuck in my layers of hair. It was all dried up and almost the same color, but once you saw it you couldn’t unsee it. We’d gotten so wrapped up in the little details that we failed to notice the one thing everyone else would. But hey, at least it wasn’t a fly!
We all need a little help along the journey. Who have been some of your mentors? Can you share a story about how they made an impact?
The people we’ve met along the way have honestly made the entire journey worth it. No one gets anything done alone. No one. It’s a pieced together messy village with you at the helm, and all you can hope is that you find great people around you. Pretty early on we got connected with an amazing woman, Mollie Fehlig. She’s one of those people that makes you feel so excited about what you’re saying, you almost feel like you’re pitching yourself. But she doesn’t shy away from pushing hard questions and pointing out holes. She helped us feel more confident in going for a bigger raise, which is something a lot of women struggle with. All of her encouragement is grounded in theory and some serious financial modeling, so after going through all the gritty details, you come out of it sure of what you need moving forward.
In today’s parlance, being disruptive is usually a positive adjective. But is disrupting always good? When do we say the converse, that a system or structure has ‘withstood the test of time’? Can you articulate to our readers when disrupting an industry is positive, and when disrupting an industry is ‘not so positive’? Can you share some examples of what you mean?
I don’t know if there’s any way to escape disruption. Humans are always looking to make something their own, and that leads to a constant state of movement. You can’t deny progress. But there are definitely times when you see something and think, did we really need another photo editing app or connected diet tracker? We can fall into a pattern of ‘creating tech for tech’s sake’ which I don’t think gets us anywhere. It can be extremely wasteful. The mindset of ‘hustle’ and ‘growth at all costs’ needs to be reconsidered. Growth should be intentional. We need to always ask why we’re growing. Is this direction the right one? What is our goal for greater impact? We have to be more thoughtful about where we put our resources, now more than ever.
Can you share 3 of the best words of advice you’ve gotten along your journey? Please give a story or example for each.
- Listen to advice, but know who you’re taking it from. Everyone has an opinion, and most are very open with sharing. Which is amazing and can be extremely! But you also have to consider where they’re coming from. Why they’re saying this to you, and whether or not you want to take it. Advice is ultimately just another piece of information, and it’s up to you to decide what’s useful.
- Be open to the pivot. This is a classic, but it’s much easier said than done. Everyone who decides to start something new does it because of a passion and goal. So it’s hard to know when to bend and flow, and when to stay strong. You have to stay true to your mission, but be flexible with your goals.
This was very true for us when we realized we needed to expand our initial offering. We’d been set on being a B2C company, bringing sustainable investing to the retail market and then following that up with a 401k offering. But after talking to our target audience, we quickly realized that we had to move up our plan. A big part of people’s investments are in 401ks, and since most 401k plans don’t offer good sustainable options, people wanted this solved immediately. The process of speaking to our users was invaluable, and its helping us not miss out on a huge market early on.
- It’s a marathon…filled with a million sprints. It will take longer than you think, at least for the overall picture. You start out with this idea, and just want to see it out on the world. But to get there, you have work like mad, over and over again. It can be frustrating and discouraging and absolutely thrilling. You have to just keep going, and find your pace. There’s no magic spell to get to you where you want to be. All magic is just hard work.
We are sure you aren’t done. How are you going to shake things up next?
We’re just getting started! We haven’t even launched yet, so right now we’re laser-focused on that. But I’d love to get to a place where I can spend time digging into the long-term impact companies have. Measuring impact is a constant struggle, and I think we often stop short of truly determining influence. Our long-term goal is to eventually influence policy. To require companies to disclose more practices and policies related to sustainability, so that we move towards sustainable investing simply being investing.
Do you have a book, podcast, or talk that’s had a deep impact on your thinking? Can you share a story with us? Can you explain why it was so resonant with you?
I’ve been an obsessive listener of Reply All for years. I’m actually generally quite internet averse. I need presence and direct connection, and I’ve struggled to find that on the internet. But PJ Vogt and Alex Goldman make you feel like you’ve found yourself invited to the dinner party of your dreams and you can just float along through the conversation, held by your new best friends and several glasses of wine.
I think they resonate with me so much because they do such an amazing job of breaking down something that always felt so big and intangible. And that made me feel like I could do that for the world of investing. I used to be deathly scared of money. I didn’t know what to do with it, but I knew it was potentially the most impactful thing I had access to. Finding out I was inadvertently supporting things I disagreed with was that massive rug pull moment for me. I could hear PJ and Alex uncovering it, imagining how shocked I’d be to hear them break it down. And after that I could never unhear it. I had to do something about it. And it couldn’t just be me. This problem was too big to keep to myself. And that’s when Arnie was born.
Can you please give us your favorite “Life Lesson Quote”? Can you share how that was relevant to you in your life?
Forward is the only option.
I don’t know if this is really a life lesson, but it’s a thought that’s been in my head a lot lately. With everything that’s gone on over the past several months, moving forward hasn’t always felt like a given. But of course, there’s no way around it. Accepting that has helped me stay motivated to keep pushing for a better world. I think we’re experiencing an unraveling of established structures. It’s such a moment of change, and looking at how we can readjust these huge systems, things that are so big they’re intangible — like capitalism or inequality — is completely necessary right now. Because if not now, when?
You are a person of great influence. If you could inspire a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. 🙂
Honestly, it would be what I’m doing right now. Making sustainable investing synonymous with simply investing. We hope our platform demonstrates to people that you don’t have to give up financial goals to achieve your sustainability goals. We’d love to get to the point where no one is separating purpose and intention from investing, but instead sustainability and impact become an inherent part of the investing process.
To me, the most valuable opportunity in investing is the promotion of a more socially-responsible form of investing. The pandemic has exposed significant underlying structural problems with our corporate system, and this creates an opportunity and obligation for corporations to shift their focus to stakeholder capitalism and be held accountable for their impact- on workers, the environment, communities, and customers. It is up to investment management professionals to educate their clients on the practice of ESG and impact investing, and to offer them the tools to integrate it into their portfolios. Many investors are unaware of the idea that you can in fact align your investments with your values, and this needs to change.
Beyond just bringing sustainable and impact investing to a broader pool of investors, we believe it is time to tear down the exclusive access that the wealthiest investors have had to alternative asset classes and more bespoke investment solutions. Innovations in investment technology, like index optimization and fractional share trading, are what make Arnie possible, and this holds true for other investment areas. It is now possible to use technology to make scalable and accessible solutions for investment instruments that have historically only served a small group of people.
How can our readers follow you online?
Well first and foremost, we’d like everyone to head to arnie-checkyourfund.com to check how sustainable their current investments are.
Beyond that, follow us on Twitter (@ArnieImpact) and on Instagram (@arnie.impact)!
This was very inspiring. Thank you so much for joining us!