“It’s one of the things that makes me optimistic about America because when I look at what we have accomplished using half our talent for a couple of centuries, and now I think of doubling the talent that is effectively employed — or at least has the chance to be — it makes me very optimistic about this country.”
Navigating through life can be a dangerous and intimidating journey without the guidance of those who have already traveled on the same path. The world is a complex place and trying to learn everything through direct experience is simply not possible. Much can be learned vicariously through a study of the lives of those who have succeeded in the areas we are interested in pursuing. Very few successful people have enjoyed lives free of adversity and trouble. It would be crazy to not leverage the lessons they have learned.
The finance industry has traditionally been dominated by men for a variety of reasons and women have often found it difficult to break into the field. Lighthouse: Women Leading the Way in Finance is an engaging compilation of the life stories of nineteen women who have found their path and are determined to help others follow in their footsteps. Maya Peterson wrote the book to inspire and empower women to study “female lighthouses in the world of finance.” While these women have navigated different paths, what they have in common is the shared experience of being women in a male-dominated field and how they found ways to overcome challenges. Although young women embarking on their careers will find the stories highly relevant, all readers should be able to draw lessons from the book. Those who are established in their careers might be inspired to give a helping hand to younger colleagues who could benefit from some guidance.
Writing this book review from the perspective of a man, it is obviously not possible to directly relate to several examples of obstacles that the women describe. However, the challenges of balancing a career in finance with having a family is one that has been highlighted over many years as being particularly problematic. The traditional career trajectory in finance involves taking an entry level job after college graduation to gain experience and to return to school to pursue an MBA, usually in your mid to late 20s. This is followed by an intense period of work into your early 30s, necessitated by a need to pay off heavy student loan debt and to prove worthy of greater responsibilities.
Of course, these career demands coincide with the age when most people want to get married and start having children. A failure to account for these challenges creates an environment in which a company can lose promising female talent to competitors. Being cognizant of these family challenges is not only a matter of ethics but also can be a competitive advantage if talented female employees can be retained.
Although navigating family challenges is a common thread in many of the profiles presented in the book, there are also other examples of obstacles that I have seen in office environments. In particular, as Lauren Templeton describes, many women are not assertive enough in business environments:
“I think women are bad at raising money because few of us have the confidence to go ask for it. I am not good at raising capital. Do you know why? Because I have never asked for any of it. I don’t ever ask. Our business has grown organically. That is a wonderful way to grow a business — by referral — but the business could be a lot better if I did what men do. Men slide a presentation across the table and say, ‘I want you to invest with me.’ Women are more like, ‘How can I help you?'”Lighthouse, p. 21
Lauren Templeton is an accomplished investor who was mentored by her uncle, the famous Sir John Templeton, but still has trouble asking for business. Part of this has to do with cultural expectations with men who aggressively seek business being viewed as “go getters” while women might be perceived as “difficult.” Templeton recounts a situation in which she had to call out her prime broker for overcharging her and their tone was immediately aggressive. She believes that labels are often thrown at assertive women such as “Gosh, she’s a bitch to work with”, whereas men who assert themselves would be held in greater respect.
Many of the women who are profiled did not set out to build a career in finance. For example, Lisa Shalett was inspired to learn Japanese and major in East Asian studies after visiting Japan during high school. However, when she eventually developed an interest in business and earned a Harvard MBA, her background in Japanese and her years of working in Japan proved to be a differentiating factor that qualified her for a Wall Street position focusing on Japanese equities. An understanding of Japanese culture, language, and business practices was more important than an understanding of markets, which she was able to learn on the job. Eventually, Shalett became a partner at Goldman Sachs and, at one point, she was the only woman partner in the equities division.
Shalett’s insight regarding leveraging all of her skills in different contexts is particularly valuable:
“I suddenly got this insight that people tend to define themselves and their skills by the context in which they have used them to date. They don’t stop and think. The skills that have made me successful in the current [role] could also be useful in this new, totally different role. I had to learn to separate the skills I had from the way I had used them to that point … ”Lighthouse, p. 72
Some of the profiles involve women who were clearly interested in finance from an early age. Erin Lash bought her first shares of stock at the age of ten and learned a valuable lesson when her pick, Blockbuster Video, fell victim to the rise of Netflix. Her first-hand experience with industry disruption led her to value sustainable competitive advantages, otherwise known as “moats”, which served her well when she joined Morningstar as an equity analyst focusing on consumer staples. Morningstar is well known for their focus on deep research to assess the quality of a company’s moat. Lash eventually moved into a director role and was the only female director in the company’s North American sector.
I have purposely not mentioned the fact that Maya Peterson is only seventeen years old until now because the quality of her work far surpasses what one would expect from a teenager and should be viewed on its merits. Peterson previously published Early Bird: The Power of Investing Young, which I reviewed a couple of years ago, and has inspired many young people to start investing.
In January 2019, Peterson gave a talk at Markel Corporation and a transcript is provided at the end of Lighthouse. There’s a great deal of wisdom in the transcript, but what stands out to me is her understanding of humility, making mistakes, and learning vicariously from the errors of others:
“Investing has also taught me to work hard on analysis. I like to call it nerdiness. Making mistakes is part of the process, it happens to everyone. But not everyone learns from their mistakes. Wouldn’t you rather learn how I lost money on Mattel and know not to make that same mistake yourself? Nerdiness allows you to keep your mind open to new information and have an ongoing desire to learn from others.lighthouse, p. 142
Peterson has made important contributions to the cause of financial literacy and helping women achieve their professional goals in the field of finance. Both of her books deserve to be widely read by young people interested in finance and investing. Lighthouse also deserves to be read by older professionals, both men and women, who want to better understand the challenges facing young women as they navigate the industry. As Warren Buffett has said, women are key to America’s prosperity so we all have a stake in the outcome.
Disclosure: The Rational Walk LLC received a review copy of the book.