E-Trade Financial sits at the intersection of two of the world’s most persistent boys’ clubs: Wall Street and Silicon Valley. But behind the layers of computer code that enable at-home investors — another mostly male crowd — to buy and sell stocks online, there’s a group of female tech wizards at E-Trade that make it possible.
Fostering a culture that attracts and advances women in the STEM fields is one more way that E-Trade, one of the earliest online brokerages, has been a pioneer in the industry. That little-known trait is something its new corporate parent, Morgan Stanley, would be smart to preserve — and emulate — especially as it looks to reach a wider set of customers.
Morgan Stanley agreed on Thursday to acquire E-Trade for $13 billion, fusing together an old-school brokerage business of wealthy Wall Street clients with a digital Main Street brand that resonates with younger people. It’s an opportunity for the white-shoe firm to gain a new type of customer it wasn’t equipped to reach in a corner of the market that’s growing — and one that’s bound to draw more prospective female customers over time. E-Trade had 5.17 million retail accounts as of December and an average of more than 300,000 trades each day.
I first learned about E-Trade’s impressive roster of female tech leadership in mid-2018, when I had the pleasure of interviewing them and hearing their stories in the company’s New York office just outside Times Square. They reflected on working their way up in an industry where they initially saw few other female faces, then later a few more, and more yet when they joined E-Trade.
Women still head up key teams, such as the innovation lab, run by Jeanne Jang, an alum of IBM. Liensa Vidra has risen up the E-Trade ranks to vice president of product management, and Heather Munoz is senior vice president of tech development, following a career at CME Group. Alice Milligan, who’s made stops at American Express and Citigroup’s North America consumer bank, was named E-Trade’s chief customer officer last May, overseeing all retail products and how digital customers use them. As with any business, some employees I met have moved on, but the leadership in the chief customer office — the core of E-Trade — is currently 60% female, according to a spokeswoman. That’s almost unheard of in financial services, where it’s hard not to notice that almost all the firms are named after men (Morgan Stanley included). 
A few of the women I spoke with stressed the importance of informal mentoring — from both male and female leaders — and having it happen organically. Alison Li, a web development manager for whom English is a second language, said that she had never had a female mentor until joining E-Trade and that it brought her out of her shell. “I felt the difference,” she said in our 2018 interview. Diversity helps the intimidation factor of being a woman in fintech fade away, is how Eileen Kane, now vice president of IT project management, put it at the time. Having a father who was an engineer when she was growing up, Kane “never thought this wasn’t a place for women to be,” a message she has since passed on to her children; her 20-year-old daughter is a STEM student. A common sentiment they all shared was wanting to pay it forward for the next crop of female techies.
E-Trade might be one of the last places one would expect to find such a bastion of female support and diversity. After all, this is a company that just three years ago advertised its services with a cliche commercial showing a dorky white guy partying on a yacht full of bikini-clad bombshells after becoming rich using E-Trade. Its commercials have since evolved: One of last year’s ads swapped out the dude for an adorable dog on a speedboat; another featured a young woman floating poolside on an Instagrammable swan raft while checking her E-Trade account.
Broadly speaking, women, not least because they earn less than men, also invest less. A 2017 survey by Bank of America Merrill Lynch found that while most are confident in budgeting and paying bills, only 52% are confident managing investments, compared with 68% of men. A majority of the female respondents also said that the financial services industry has traditionally catered to men. Funny enough, an abundance of research has shown that women make pretty good investors. They tend to be more cautious, patient, trade less (which saves on fees), are less prone to panic and thus outperform. As I’ve noted before, it’s no wonder that women share these traits with Warren Buffett, the world’s most celebrated investor. Even so, only 10% of fund managers in the U.S. are women, and they tend be put in charge of passive funds, according to consistently depressing but important research done by Morningstar.
Corporate America has certainly placed a bigger emphasis on gender diversity and pay equity. But when companies brag about their progress, a closer look will often reveal that female leaders tend to be clustered around public relations and human resources. As important as that work is, those positions don’t put women on course to become the next CEO.
That’s why I found E-Trade so refreshing. Women are at the center of the company’s foundation: its technology, the “E” in its 1990s-throwback of a name. Having that diverse perspective and life experience will only help E-Trade and its new parent design products that appeal to a wider group of customers. (I’d be remiss not to mention Ellevest here, a robo advisor that already specifically targets women and was founded by Sallie Krawcheck, who once ran wealth management at Bank of America and Citi.)
James Gorman, chairman and CEO of Morgan Stanley, said he’s considering calling his newly acquired business something along the lines of E-Trade Powered by Morgan Stanley, but that it’d be “completely nuts” to get rid of the E-Trade brand. E-Trade CEO Mike Pizzi isn’t going anywhere either. The bank would do well to keep E-Trade’s culture intact, too.
Leave a Reply