Charisse Conanan and Adrissha Wimberly Are Changing How Millennials View Personal Finance
One of the hottest topics this election season is about student loans and student debt. According to the U.S. Consumer Financial Protection Bureau, student loan debt recently topped 1 trillion (yes, trillion) dollars by the end of this year. And while there's plenty of financial self-help books (Suze Orman's The Money Book for The Young, Fabulous, and Broke comes to mind), few financial tools are targeted to a generation that consumes information in a more tech-centric way.
Enter Smarteys, a financial software tool founded by Charisse Conanan and Adrissha Wimberly that targets millennials through universities, companies, and other organizations.
I chatted with the two partners, who met at Chicago's Booth School of Business, about personal finance for the tech generation, how to assess risk, and overcoming the challenges faced by being an "outsider" in the tech world.
What is Smarteys? What’s the story behind the idea?
Smarteys is a movement for 20 & 30 year-olds to get a handle on their money. We provide simple and affordable financial software to plan your paycheck.
The story is a common one. While starting our careers, we experienced the pain that new graduates feel year over year when planning a paycheck. We were recent grads with new salaries and student loan debt, living in a new city with no clue on how to manage our money. Is it wise to keep 10% or 30% of a paycheck? Do I put away for retirement or pay down debt, and how much?
We turned to spreadsheets and other online services to help us ease the pain, automate budgeting, and become more financially responsible. However, the existing services were cumbersome and disconnected, and they never answered the real questions: What is the best use of my paycheck? How much will I have left to spend after saving, paying down debt, and bills?
The Internet was crowded with great financial applications, but there was no software that focused on the needs of recent graduates. There is no reason for graduates to have great academic educations and sub-par financial educations, so we are focused on making a difference in the lives of the millennials. This is how Smarteys was born.
How did you guys meet?
We met in business school at Chicago Booth in the fall of 2008. There were numerous entrepreneurial events, and we’d always see each other around. Each time, our conversations narrowed, finally highlighting our commonalities and desire to use school as an incubator for an idea.
Our faith also was a major factor in our partnership working out. We both have very strong Christian faiths. It was easy to move forward once we realized that God was going to play navigator, mediator, peacemaker, and captain. We didn’t have to worry about being responsible to each other because we were responsible to Him. We both felt this was our purpose.
I don’t think I would give advice to my 13-year-old self. I would hope that life continues to be as innocent and easy and that the truths and realities of adult life that need advice, I won’t need to learn for many more years. So, I guess I’m saying the advice would be -– just be a child, be childish, and enjoy every part of irresponsibility and cluelessness.-- Adrissha
You both left very successful careers in finance to become entrepreneurs. Are you naturally risk takers? If not, how did you develop enough "gumption" to start Smarteys? If yes, how do you determine what's a good "risk"?
We are both risk takers, but in different ways which speak to our personalities. Charisse approached entrepreneurship with facts supported by faith. Adrissha approached entrepreneurship with gut and grit. The stars were aligning in Chicago, the city had a momentum around startups; the world of traditional banking was also changing, so it was a good time to jump. The leap was bearable because we both had successful careers that allowed us to go all in –- at the very least, we knew we would be able to feed ourselves and if things didn’t work out, we could always get a 9-to-5.
Developing gumption isn’t possible. You either have it or you don’t. And it’s okay if you’re not willing to quit your job to start a company. Maybe you need to work while you build your base. For others, the idea will consume you so much that it has to be a full-time job. That’s how it was for us. We just couldn’t think of doing anything else.
Here’s a quote to hold on to:
Of your life's journey, don't seek permission. This kind of permission isn't something that's given; it's something that's taken. It's not bestowed upon your by some kind of expert, it's something that's acted upon by an individual. If you really want to do something great, you have to start by giving yourself permission --Chris Guillebeau
Determining good risk is complicated. There’s no prescription for risk tolerance, but here are some things to ask if you’re putting everything at stake:
1. Do you love more than just the idea? Do you love the business of making a business? Trust us, in the beginning you function in every role: CEO, COO, CTO, CFO, CMO, HR, and Sales. Know what you like and can do well and know what you can’t.
2. Can you do it alone? If not, how strong is the support team around you?
3. Are you distracted by other concerns in life -– money, relationships, etc? If so, then maybe you need to take care of that stuff first.
4. Do you have clear and plausible access to cash? Companies don’t always fail because they are bad ideas. Many fail because the company (or the founder) simply runs out of money.
5. Do people gravitate to your idea? The market is honest: If you notice a lack of interest from the people you tell about your business or see constant questioning of its value proposition, maybe the collective wisdom of others is worth considering.
One of the barriers for many black-led tech start-ups is the limited availability of “familial” investment. Did you have to overcome this barrier and if so, how did you overcome it?
It is true that the general population of entrepreneurs follows a statement that goes like this: "If you can’t convince your family and friends to invest, then you won’t be able to convince others." But for many black founders, loved ones are honestly unable to give large sums of money for a myriad of reasons, including the lack of intergenerational transfer of wealth. Studies show that average wealth for black families is $6,000. So you have to meet them where they are. That’s what we did. We created a donation site (adrisshacharisse.info) and raised nearly $10k from friends and family, who gave as little as $25 each. For those capable of giving larger investments, we approached them in the same professional manner that we would approach an experienced angel, and this approach allayed any fears, because we were prepared to handle the responsibility of taking their money.
Is it harder for black women to start tech companies than, say, women of other ethnic backgrounds? If so, why?
We would love to say that it’s just as easy for a black woman to start a tech company as founders of other ethnicities. Unfortunately, that’s not the case. But it’s not because of race; it’s because of networks. Anyone who studies sociology can tell you about homophily, or the tendency to associate and bond with others similar to you. Since building a company and finding investors is as much about finding people who like and identify with you as they do your idea, it is plausible to believe that anyone outside of those needed networks like computer programing, research, and venture capital will find it hard to break in.
So it takes us a bit longer to form immediately identifiable channels because we’re trying to fit into a larger network that has fewer innate traits to bond. A way to fix this is to have to more blacks or more women in these networks -- then, homophily would take care of itself.
Many people, however, might assume that others just don’t want to work for, or invest in, a black woman. This just hasn’t been true in our experience.
Smarteys has pretty strong board of advisors. How did you get these top folks to invest time (and in some cases) money in your business?
This is probably related to the theory above. Our bios are buzzword heavy, and most of our advisers instinctively identify with one or more of the names in our pedigree. That has allowed us to get their attention, but what made them invest in us is our passion and commitment to Smarteys. Sometimes getting a good adviser is about being a good advisee, if that’s a word. We actively engage our advisers and let them know that we’re not here to waste their time. We take their input seriously and respect the relationship.
And also, let’s be honest that most things aren’t free. We compensate them as well.
What are some tech startups led by black women that you’re excited about right now?
Here are some of our favorite tech start-ups that just happen to be led by black women:
You Lingerie: http://www.you-lingerie.com/
New Equity Business: http://newequitybusiness.com/
Madame Noire: http://madamenoire.com/
For more thoughts on women, technology and business, please follow Kathryn on Twitter at @KathrynFinney