Taxes And Innovation

When a country – or a state or a city — taxes more, it gets less of whatever it taxes. Sales taxes discourage consumption. Income taxes discourage money making, which in most cases is work. Capital gains taxes discourage investment. All statistical research supports this conclusion, at least to a degree. Disputes arise only over the extent of the adverse impact. Since taxes are a necessity of life in an organized society, the object is to find ways that minimize these ill effects and place them in areas least important to society.

Innovation is an area of particular concern. It is the lifeblood of this country’s high-tech economy and a key element in America’s ability to compete with lower-wage labor in most of the rest of the world. Until recently, little of the statistical work on tax effects focused on innovation. New insight has, however, emerged in a recent joint study by a combination of scholars at the University of Chicago, the Harvard Business School, and Harvard University. Their work makes clear that taxes on income especially have an adverse impact on innovation, how much occurs overall and where it occurs within the country, though it is far from the only factor. Though most of the analysis draws on historical data, the new tax law’s cap on the amount of state tax available for a deduction on federal tax liabilities will tend to exaggerate the already stark distributional findings of this impressive research effort.

For a long time, economists and statisticians had difficultly gauging the particular impact on innovation. Three new data sets and the considerable resources of these collaborators have, however, overcome past difficulties and allowed the researchers more definite conclusions than in the past. The first of these new data sets is the digitalization of historical patent and research citation data going back to 1920. The second includes more complete information on research and development (R&D) efforts, specifically the numbers of research laboratories and the number of people employed in them. These, combined with data on both federal and state taxes, provide insight into the overall effects of taxation on innovation. A third new data set on state level corporate and individual income taxes allowed the analysis to take yet another step and examine the impact of taxation on where innovation takes place within this country.

What these researchers discovered is that the tax impact on innovation nationally is less significant than how state taxes determine where innovation locates. Evidently, the hurdle to leave the country is higher than the hurdle to move from one region within the nation to another. Even then, the analysis shows less impact from taxes where innovators cluster. If a region contains a significant concentration of firms and individuals in the same technological field, it will continue to show high levels of innovation almost regardless of taxes. The continued productivity in Silicon Valley in high-tax California stands as an example, as does the continued impressive activity around route 128 outside Boston in almost as high-tax Massachusetts. But even considering the impact of concentration, the work of this impressive team found a clear inverse relationship between taxes and innovation.

It seems that especially those the researchers categorized as “superstars” are sensitive to tax. Evidently, those who generate an inordinate number of patents and receive a lot of research citations, whether individual innovators or corporate efforts have confidence that others will follow if they move. Without the risk of isolation, these sorts can afford to respond more readily to tax considerations. The researchers discovered what they refer to as negative “elasticities” of between 2 and 3.4 to hikes in personal income taxes and 2.5 and 3.5 to hikes in corporate taxes. The term elasticity has a strict technical meaning, but for these purposes, it might be viewed as a percent effect for each percentage point of additional tax.

When the analysis breaks out the impact on individual inventors, the elasticities tend to shrink, though they still find an adverse impact of tax on innovation. When personal state income taxes rise, patents fall by the elasticity of between 0.6 and 0.7, while the elasticity on citations falls between 0.8 and 0.9. State taxes also determine the flow of individual innovators from elsewhere. The adverse elasticity is lowest when the inventor is originally from the state in question. It comes in at only 0.11. Evidently, family and personal connections have an independent positive impact. For innovators with origins in another state, this adverse elasticity of state income taxes rises to 1.23.

The policy implications are clear enough. States that want to attract innovation would do well to contain both personal and corporate taxes. This is true especially of states that from a historical accident do not already enjoy a cluster of innovation that can attract others and hold those already in place despite tax considerations. These conclusions are clear even in the historical period of analysis when a federal law was more generous to high-tax states than now. If anything, the new, less generous federal law will increase these adverse “elasticities,” though it will take years before research will have the ability to put a number on the extent.

More from our Chief Economist:
Still the Wrong Answer in Japan
Fintechs and the Banks
Cheating the Future

Celebrate Financial Literacy Month with 21 Savage

How much money you got? A lot. How many problems you got? A lot … but less now that 21 Savage is on a mission to improve the financial literacy of youth across America.

The Atlanta-based rapper, who is actually from the UK, found himself in a lot of hot water after overstaying his Visa. He was detained by ICE on this year’s Superbowl Sunday and remained in custody for the next nine days. Following his release, the “Bank Account” singer is putting his money where his mouth is with a newly-created financial literacy program called–yep, you guessed it–Bank Account.

The campaign aims to provide teens across the country with the necessary resources to learn about finance. To do so, 21 Savage teamed up with Juma and Get Schooled, two non-profits that promote education and success among at-risk youth. Together, the trio hopes to arm kids with the tools and knowledge to combat predatory credit card companies and high-interest loans.
In an interview with Billboard, Savage explained that although he has a hit song called “Bank Account,” he actually knew virtually nothing about bank accounts growing up.

“As I have gotten smarter about financial management, I realize how empowering it is to control your money rather than be controlled by it,” Savage said. “I want to help kids with a background similar to mine to get smart about their money.”

Watch the video about the program below:


Savage took it a step further when he promised to bring 150 jobs to his home (ish) town of Atlanta through the non-profits, which offers employment training and opportunities for teens at entertainment and sporting venues across the United States. The rapper will act as an advisor, or as he calls it, the “Money Making Mentor” for the program, offering monthly tips on how to best manage money.

For those who see this as a publicity stunt post-arrest, hold your judgment. Savage has been working with Get Schooled for the last few years, donating $1,000 each to 21 students nation-wide open bank accounts.

“We need to start, like, introducing them to this type of stuff at younger ages so that by the time they’re grown, they already got it down pat,” he told Mic in 2018.

As for his deportation, it seems 21 Savage and his mission to improve the financial literacy of American teens is here to stay. He was released from an Immigration and Customs Enforcement center in mid-February and has applied for a U-Visa. His application is currently pending.

Still The Wrong Answer In Japan

World media, once riveted on Japan, has long since lost interest. The rise of China and disappointing decades since the Japanese economy’s heyday of the 1980s have understandably turned heads elsewhere. Japan nonetheless warrants attention.  It is, after all, the third largest economy in the world and the second largest in Asia. And of late, its economy seems to have faltered yet again, suffering because it still depends heavily on exports, and its largest market, China, is suffering.  Japan need not live with this vulnerability. It need not remain dependent on exports and so on China.  It would, in fact, serve its aging population better if it were to abandon its continued emphasis of production for export and pursue a more balanced economy that depends more on domestic sources of demand.

At the moment economic indicators look ominous. According to the latest report of Japanese purchasing managers, manufacturing activity shrank in February, for the first time in two-and-a-half years. Business confidence also soured for the first time in six years. Orders figures point to sharper future sales declines. Machinery orders overall fell 5.4 percent in December, the most recent period for which data are available, while overseas orders recorded their biggest drop in more than two decades. Government data showed an 8.4 percent drop in Japan’s January exports, the worst performance in two years. Exports to China, Japan’s biggest trading partner, fell 17.4 percent. Exports to the United States, mostly cars, expanded some 6.8 percent, but imports from America, mostly oil, rose at a faster 7.7 percent pace. Signs of weakness look serious enough for the Bank of Japan (BoJ) to announce an immediate turn to stimulus. BoJ Governor Horuhiko Kuroda, while denying that the economy is in recession, announced support for growth, pledging to keep long-term bond yields at zero and short-term interest rates at minus 0.1 percent.

Most commentary on the sudden loss of economic momentum lays the blame on China’s economic problems and connects them to the incipient trade war with the United States.  China’s economic slowdown is definitely an immediate cause of Japan’s export problems but the U.S. tariffs are only part of China’s and hence Japan’s problem. At least as significant is the departure of the industry from China. In part, these firms are trying to avoid the tariffs, but they are also in search of lower-wage labor than they can now get in China. Theoretically, these new operations outside China, largely elsewhere in Asia, could source their equipment in Japan as they did when they were in China, but in these new, less advanced locations, management has less need for cutting edge machinery.  And then there is the fact that China has entered a new, slower stage of development. When China first emerged economically late in the last century, it had many obvious projects that vastly and easily increased economic efficiencies and capabilities.  As it has realized those opportunities, the pace of growth has naturally slowed. China has battled this fact for some years, trying to simulate that earlier stage of development by engaging in dubious, grand projects.  Rather than help, this effort has only created a debt overhang that now further impedes Chinese growth.

With all these other factors in mind, it is clear that China’s problems and hence Japan’s export difficulties will not dissipate as easily as some suggest. Even a favorable trade deal between China and the United States, one that lifts all the tariffs, will not necessarily return China to the fruitful destination for Japanese exports it once was. Yet, Japan could have avoided all this, if it had abandoned its export-oriented growth model in the 1990s when it first showed signs of breaking down.

It was clear even then that Japan no longer had the youthful, low-wage population that had once fueled export-oriented growth. Japanese wages had long since risen to some of the highest in the world. The population had become far from youthful. As of today, fully one-quarter of the country’s population is over 65.  The economy has barely over two people working age for every retiree. This is hardly a demographic basis to aim to remain the workshop of the world. Rather, it suggests that Japan look for growth in a more balanced economy that depends less on production for export and more on domestic sales, particularly consumer spending. Japanese business has long since pointed the way, relocating production to low-wage areas of Asia, China initially but also elsewhere, in Taiwan and Indonesia, as well as the Philippines. But the government has shown less insight. It has continued to discourage consumption and spend on support for industry and exports. It had actually planned a consumption-crushing sales tax hike until this recent bad economic news prompted a rethink.

Japan may never again grow as fast as it did in the heyday of its export-driven model. Those double-digit real rates of expansion are now part of a world long past. But with a shift toward consumption, the policy can serve the county’s population better and importantly end the economy’s vulnerability to China. Japan need not give up on production. It just needs to do the producing overseas among low-wage, youthful populations. Japanese engineering and quality control are transferable. Ownership and management will enable Japan to bring home much income and wealth from what others produce under Japanese guidance. With a change in government emphasis, Japan could support a consumer-led economy that produces goods and services for its people, particularly its aging population.  The economy in this way can find stability and growth that elude it under its current export-oriented policies.

More from our Chief Economist: 
Fintechs and the Banks: An Evolution
Cheating The Future
The National Debt: How Frightening?

3 Ways to Maximize Financial PR Wins

Congratulations! You scored a prime public relations placement: an op-ed in a target publication, a guest spot delivering market commentary on national TV, or an endorsement by a high-profile influencer. Unfortunately, thanks to today’s digital landscape and 24-hour news cycle, your moment in the spotlight will probably be short-lived. Breaking news, fresh content and constant social media updates will inevitably push your “hit” off of news feeds and TV screens sooner than it once did. The good news is that there are ways to extend the shelf-life of your most impactful content.

Here are three ways to make the most of your PR wins:

Share it on social media

This may seem obvious to marketers, but a little extra planning and effort can deliver a lot more bang for your PR buck. Rather than simply sharing the article or segment when it appears, write two or three unique updates for each social channel highlighting different pull quotes or takeaways, and stagger them according to your schedule for posting on each channel. This gives followers of your brand more than one chance to see the content. To broaden its reach further, encourage individual colleagues who are active on social media in a professional context to share it with their networks (LinkedIn is a great place to start) via a quick, simple update like “Insightful comments on recent regulatory changes in the financial advisory space from my colleague Mary.”

To amplify that reach even further, a small advertising spend to “boost” posts goes a long way. Spending just $50 or $100 to sponsor the post allows marketers to ensure their piece of PR coverage is reaching a specific and targeted audience.

Push out an email blast (and/or a signature link)

If you maintain an email marketing list, write up a catchy subject line and a short introduction for the content and send out an e-blast encouraging contacts to take a look. Beyond simply announcing that your CEO was on TV or quoted in a prestigious publication, make sure to provide some context and highlight the value for them: is it a fresh take on the day’s big headline that hasn’t been explored elsewhere? Does it offer research findings or other useful knowledge based on your company’s unique perspective and expertise? Tell them why this landed in their inbox, and why it’s worth their time. It also appears more authentic and personalized than braggy.

In addition, you or your spokesperson and other colleagues may consider leveraging your standard email signature to showcase PR wins. It’s as simple as writing a short, punchy, one-line teaser that includes a hyperlink to a clip or story. (If you’ve been in touch via email with members of our team at Vested, you know we practice what we preach when it comes to this tip!)

Make it personal

Beyond publicly building your brand, a great placement can serve as a touchpoint for contacts with whom you’re trying to build a relationship–whether that’s a prominent reporter, a prospective client or hire, or an influencer or brand with whom you’d like to partner on a future event or campaign. Passing along a great hit with a personalized upfront note can help keep you on a high-priority contact’s radar, reignite a conversation, and breathe some new life into an existing professional relationship.

Fintech and the Banks: An Evolution

The relationship has almost come full circle.  A little over a decade ago, the banks entirely dominated lending.  All but the largest businesses, which relied on the bond market, came to them.   Community banks had a lock on small business lending.  Beginning in earnest about ten years ago what journalists refer to ominously as “shadow banking” began to use emerging technologies to challenge this bank monopoly, most especially community banks.  These so-called fintech applications gained ground rapidly.  But then, typical of capitalism generally and American capitalism, in particular, matters changed yet again.  Banks began to alter and, in some instances, jettison their old business models and apply fintech themselves and do so in imaginative ways.  This move has shadowed the difference between shadow and traditional banking and opened still more opportunities for customers.

Phase one of this process began right after the financial crisis and the great recession of 2008-09.  Then, bankers, for obvious reasons, decided to pull away from risk, especially in real estate and small business lending.  It is easy to understand why.  The crisis and recession had bankrupted many small- and medium-sized businesses and, were it not for the government rescues, the losses would have brought down many banks.  At the same time, regulatory demands, especially from the Dodd-Frank financial reform legislation, imposed tremendous restraints on bank risk-taking.  The Fed’s desire in the crisis to bring short interest rates down to zero further encouraged the banks’ retreat by giving them a substitute.  Rather than lending, they took advantage of the huge gap between what they paid for short-term funds and what they could get on long bond yields, or as the traders say, arbitraged along the yield curve.

But borrowers – small businesses and others – still sought credit.  Fintech opened the way to get funds to these eager borrowers.  Technology users introduced a mind-boggling array of business models.  Aside from the luxury of lying outside the burdens imposed by arcane banking regulations, the fintech “shadow banking system” drew strength from technologies that introduced newer and more powerful ways to collect and process data.  Rapidly, peer-to-peer lending, on which the fintech “shadow” lenders were already making comparatively large and unsecured business loans, expanded to other sources of funds, from private equity and banks, even those with which they competed.

The banks soon found themselves at a tremendous disadvantage.  Fintech introduced non-traditional credit tests that made the loan application process faster and less onerous than at the banks.  Because the technologies enable “shadow” lenders to reduce risk with new monitoring techniques and using their technological prowess to arrange payments through automatic deductions from incoming receipts, the whole package also allowed the “shadow” lenders to pass borrowers more quickly, securely, and effectively and lend at more attractive rates than the banks would offer.  Fintech’s command of data allowed “shadow” lenders more flexibility than the banks, allowing them to offer credit more readily by making trade-offs between interest rates, loan commitments, and lending limits, something infinitely more appealing than the bank practice of simply saying yes or no according to standard arrangements.  Most devastating to the banks, the data use of the “shadow” system ran around the one great advantage community banks had in small business lending: knowing the borrower.  It is hardly surprising then that after the introduction of the fintech alterative, one-fifth of the nation’s community banks closed their doors.

Over time the realization of fintech’s superiorities has driven the banks began to close the circle, render it “unbroken” in the words of the old hymn.  Of course, the Fed, having raised rates, has inadvertently spurred the banks on.  By raising short-term rates and so narrowing the gap between short rates and long yields, it rendered the bank’s old arbitrage strategy much less profitable.  But the bankers always knew that that game could not last forever.  The primary spur to change came from the competition’s clear superiorities.  Larger banks have begun to build their own fintech divisions and in many cases have acquired the competition.  Smaller community banks have also made acquisitions.  More interesting and perhaps indicative of the future are the cooperative links community banks are forging with their one-time fintech rivals.

These associations have enabled both banks and fintech non-banks to better serve customers than either could independently.  Through them, community banks can not only ride the new technologies but when regulation or bank practice prevents lending, these arrangements give community banks options beyond the simple rejection that once was their only choice. Now if need be they can now refer a would-be borrower to a more flexible non-bank lender that might have a way to advance credit.  Non-bank lenders gain from the associations as well, finding more secure sources of funding from the bank or banks with which they associate themselves.  They can also use the bank partners to gain exposure to a broader population of potential customers and a means to offer existing customers banking services that these notoriously short-staffed operations could not when they operated entirely independently.

Society, it seems, has also begun to realize benefits.   With these associations, customers for financial services have at their disposal more complete information about their options than previously and, because the associations have brought together regulated and non-regulated firms, greater transparency as well.  At the same time, the regulations imposed on banks have begun to influence the non-bank sector in ways that they did not when the divide was sharper.  The frequent media warnings about the astronomical growth of non-bank lending many remain serious, but these latest steps in this story draw out some of their sting.

More from our Chief Economist: 
Cheating the Future
The National Debt: How Frightening?
Consumers Will Regain Their Mojo Later This Year

The Psychology Of Money: 4 Take-Aways from Breakfast and Brainfood

Earlier this week, we held our latest Breakfast and Brainfood event in London. Simon Moore, Chief Psychologist at InnovationBubble, led us through the inner workings of our mind–but more importantly, the minds of the audiences we’re helping our clients to reach day-in and day out. The early morning start brought together communications and marketing professionals from across the financial services industry to understand more about how our brains work,  which enables us to be better communicators.

The event’s lively debate definitely gave us food for thought, so we’re excited to share what we learned.

We make over 35,000 decisions every day and less than 1 percent of these are made consciously.

For those of you that have read Nobel Prize-winning book ‘Thinking Fast and Slow” by Daniel Kahneman, you will know that the brain uses two systems to process information and make decisions; system one being subconscious and system two being conscious. Only 70-100 of those 35,000 decisions we make use system two, which means that when we’re communicating with clients, we’re dealing with their subconscious decision-making process.  It is this kind of thinking that exposes us to their cognitive and motivational biases, which brings us to our next two points.

It’s emotions that persuade, not facts

Emotions are 400 percent more impactful on decisional outcomes than facts and figures. Great news for those of us that an industry like ours that relies on facts and figures in our communication! Facts activate memory and categorisation (20 percent of the brain’s attention), whereas stories activate emotions (80 percent of the brain’s attention).

Your brain gives four times more weighting to negative information

It’s so often the case that clients will talk to you about the new product that their teams are creating, or what they think the industry needs. However, when it comes to keeping customers happy, it’s often the small, incremental improvements to their existing products and service experience keeps them happy – and most importantly reduces any negative experiences they might have.

People want a frictionless experience, not a frictionless brand

We’ll often hear clients talk about becoming a “frictionless brand,” but according to science, people like friction – it makes them feel important. Being somebody who has solved a problem plays to everybody’s ego. Think of when you’re booking a holiday – most people like searching through hotels, villas and looking for nearby beaches. They also like telling their friends about the great deal they found, or the cute untouched part of a well-Instagrammed city they were able to discover. The need for no friction comes when it’s time to book. It’s the experience that needs to be frictionless, not the brand.

If this sort of psychological debate and investigation as to what works for audiences is what gets you out of bed in the morning please get in touch. It’s the sort of topic we love to debate and will be the subject of future events you could join.

 

Cheating The Future

The U.S. economy has behaved well during the past couple of years.  Growth has accelerated nicely from the anemic pace that prevailed for much of the period from 2010 through 2016. Real gross domestic product (GDP) during that time expanded at less than 2 percent a year on average and employment expanded by a mere 175,000 jobs a month. Since, real GDP has grown at almost a 3 percent yearly pace, while the economy on average has produced 238,000 new jobs a month. Little at the moment presents an immediate threat to growth.  Longer-term, however, concerns multiply. In particular, American business and industry seem reluctant to invest in new facilities, equipment, and intellectual capital. This behavior threatens future prosperity on a most fundamental level, including the outlook for increases in labor productivity and hence wages.

This reluctance to expand production facilities was clearly evident during the slow growth years earlier in this recovery.  Between 2010 and 2016, real spending on new equipment and premises as well as technology grew at only 3.6 percent a year. That was certainly faster than the anemic increases in overall real GDP, but typically such spending surges in recoveries to catch up for the equally sharp cutbacks faced in recession. This last cycle saw the recessionary cutbacks but not the capital spending surge in the recovery. Spending on structures grew on average a paltry 2 percent a year on average, perhaps in reflection of the over-investment in real estate during the time leading to the 2008-09 great recession.  This particular circumstance cannot, however, explain the only 3.7 percent yearly rate of advance in real spending on equipment or, more significantly, the only 4.8 percent annual growth in spending on what the Commerce Department refers to as “intellectual property products.”  This area, mostly technology, had frequently exhibited double-digit rates of growth prior to this time.  Seldom during this whole six-year period did new overall spending exceed depreciation by more than 30 percent. Past recoveries often saw rates of capital spending exceed depreciation by as much as 50 percent.

Reasonable speculation ascribes this paucity of spending to three factors: First up is the shock of the 2008-09 financial crisis and the great recession. So many people made so many bad decisions in the run-up to that debacle and as a consequence lost so much money that business managers understandably had a reluctance to pursue any new project as aggressively as they might have in the past. There was also the anti-business tone emanating from Washington at the time. Even in the absence of explicit threats, business decision makers worried that government policy would tax away or otherwise impede the gains that might accrue to new investments.  The third was the flood of extensive new regulations coming out of Washington. These not only increased the costs of doing business and consequently restrained any urge to expand or upgrade, but they also left managers uncertain about future directions.

By 2017, those restraints seemed to lift.  Memories of 2008-09 pain had dissipated, and the new administration had begun to remove some of the most costly regulations, as well as implement pro-business tax reform. Capital spending by business gathered momentum.  In the first quarter of 2017, such spending overall jumped abruptly at a 9.6 percent annual rate in real terms, a big change from no growth in the fourth quarter of the previous year. And it continued at near that heightened pace well into 2018.  Over 2017 and the first half of 2018, all sorts of capital spending by business rose at an 8 percent yearly rate, far faster than previously. New real spending on equipment rose at a smart 8.6 percent yearly rate, and spending on intellectual property returned to its older rapid growth trajectory, turning in an average 11.7 percent yearly rate of advance.

But of late, a more timid, less desirable pattern seems to have re-asserted itself. The third quarter of 2018 saw only a 2.5 percent rate of expansion in overall capital spending. The pace picked up in the fourth quarter. Growing at an annual rate of 6.2 percent, but orders for new capital goods told a different story. For the September-to-January period, they showed a slight outright decline, while this figure absent ever-volatile aircraft orders showed a drop of almost 5.0 percent at an annual rate. The change could simply reflect a reaction to the earlier surge, but it might signal a worrisome return to the anemic spending pace of earlier years.

Nor do the available data necessarily support the popular official and unofficial claims that college is a best route to a rewarding career. The typical comparison touting college points out that an average college graduate will command an annual salary of about $58,000, while those with only a high school degree will command $34,000. But the picture changes if the calculations include an adjustment for the academic standing of those involved. The bottom half of college graduates command annual salaries of only between $28,000 and 58,000, where the top half those with only a high school diploma command annual salaries of between $34,000 and 70,000. The averages favor college, but they hide how a talented worker can do well despite the lack of college. To be sure, talent with college can go still further, but only if the college track suits the individual in question.

None can doubt that some careers demand the fruits of a good college education and more. But many jobs that otherwise require skill and intelligence and that pay well do not. Employers have insisted on college for many jobs that really do not require it because they do not trust the quality of a high school diploma and, in the absence of a vocational track, have no other basis to judge. The nation could serve its economy, its employers, and its workers by offering an effective vocational alternative and reallocating some of the college-linked largess to other sorts of training.

More from our Chief Economist: 
As another government shutdown looms, markets remain steady
Consumers will regain their mojo later in the year
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5 Important Lessons Learned During Vested’s Graduate Program

Everyone knows transitioning from college to adult life can be tricky. With so much uncertainty in the air, it’s difficult to gauge which paths will lead to the greatest amount of growth and self-fulfillment. When I first became a “Vestie,” as we call them here, I had no idea this role would be one of the most challenging yet gratifying experiences I’d have in my life to-date. I’ve learned so much about myself both personally and professionally and attribute much of that to the smart, hard-working and downright fun team I get to work with, and an exceptional team of leaders who understand the value and importance of investing in young people.

Like quite a few Vested employees, my journey here started with the company’s grad program. It allowed me to hit the ground running and  learn, create and expand my horizons with the structure and support that a lot of post-college grads lack and crave.

During my last semester at Johns Hopkins, I went through the dreaded senior phase where I was incredibly anxious about graduating and in need of a job. I discovered Vested through my university’s job posting website (shoutout to Handshake!) and before I knew it I was on a phone interview with one of my now closest co-workers, Emma Clarke, who also happened to be a graduate of the program. We bonded over the New York Times’ Modern Love column and I knew it was a fit right away.

Now that I’m a full-time Vestie, looking back on my time in the grad program taught me five, super important lessons that I refer back to on a daily basis.

1. Learning how YOU work: The distinction is key. Some people work best by writing out a to-do list by hand and others use Google calendars to set up reminders. It’s not an exact science because what works for someone else might not necessarily work for you. Currently, I use a Google spreadsheet with all my tasks and time estimates for how long it will take me to accomplish them. Turns out you can’t squeeze a 15-hour working day into a 9 hour one!.

This may sound super simple, but learning what I needed to stay on task, meet deadlines and maximize my time was a turning point in my work life. Through a trial and error process, my manager stuck with me as I tailored this system that ultimately allowed me to complete the grad program with more ease

2. Learning how to balance: It’s easy to let an entire day go by without standing up and stretching your legs. During my time as a grad, I learned that I need to get up and take a break in order to boost my productivity. You’d be surprised by the difference a walk around the block makes! It’s one of those tricks that seems so obvious, but often times, I’d realize at 5:30 that I’d hardly stood up from my computer. Forcing myself to take those breaks where I go for a walk, get a coffee, or even just play with one of the many Vested dogs here allows me to mentally reset and approach my next task with fresh eyes.

3. Being proactive: When you’re right out of college, it can be intimidating to speak up in meetings or voice to your manager that you want to be involved more. But the grad program really encouraged me to seize those opportunities and advocate for myself when there were projects I really wanted to be involved in–even when I wasn’t an expert on the topic in question. The teams at Vested are configured in such a way that there’s always a mix of senior, mid and junior-level staff involved and a variety of skill sets. So, if I wanted to work on a client’s paid social media program, I could do that and know I’d be surrounded by people with tons of experience who would be willing to sit down with me and teach me the basics.

4. Conducting research: This one’s a bit more tactical, but equally important. As a grad, I spent a lot of time understanding clients’ backgrounds, their company history, their specialties, and business needs. I’d then take that research and synthesize it for the team into digestible information relevant to our work. Doing this type of research not only taught me how to find credible and valuable information but also how to parse through what we don’t need and get to the nuggets that really influence our strategies and that ultimately allow our clients to make more informed decisions.

5. Finding great mentors: I believe all recent grads have a specific idea in mind when they think of mentors. They usually think of industry veterans who have been perfecting their craft for decades. But what I’ve come to realize during my grad program is that mentors who are in your immediate space – managers, coworkers who are more senior – will take your further than you’d think! My manager, Marian, and co-worker, Adrienne, have equipped me with everything I needed to succeed and it all came from their willingness to teach me the ropes.

Your first job out of college can be incredibly formative and eye-opening. I believe my choice to join Vested right after graduating allowed me shape myself personally and professionally around people who were unequivocally supportive and who wanted to see me succeed. The team here is sharp and incredibly smart – while also being fun and nurturing of junior level members.

As an associate, I look back in awe of how much I’ve grown since my first day as a grad. Vested has provided me opportunities that I never thought accessible to someone just starting her career, which speaks volumes about the beliefs of the firm and where it is headed as we expand and look to add fresh new Vesties who are eager to learn and be part of a brilliant team.

How to Conduct Productive, Insightful SME Interviews

As marketers, our job is to communicate a message and build a brand, which often entails having a working knowledge about a variety of topics related to organization, product or spokesperson we’re promoting. But compelling thought leadership requires marketers to “go deep” and really showcase our understanding of a topic, especially in a complex field like financial services. Interviewing a subject matter expert (SME) is a great way to glean critical information for marketing efforts. If you’re not an expert on the topic at hand, the best way to think or write like one is to talk to someone who is. Here are four tips to help you conduct fruitful, efficient interviews:

Draft and prioritize questions ahead of time

Before you sit down with an SME, identify your objectives for the interview and write down the questions you need to ask in order to achieve them. If you’re interviewing a fintech CEO about trends in that sector for a year-end blog post, you probably don’t need a detailed recap of the company’s history. Additionally, it pays to make sure the information you’re looking for is not available elsewhere. Your source’s time is valuable and limited, so it’s best to do your homework ahead of time.

Once your questions are drafted, put them in order of priority based on how much time you have for the interview, keeping in mind that open-ended questions (“How has recent market volatility affected your investing strategy?”) take longer to answer than those with straightforward factual answers (“What is your revenue goal for the third quarter?”). Ask your high-priority questions early on to avoid running out of time before getting the answers you need.

Brush up on key terms and relevant data

Financial services has its own language, and if you’re talking to an expert, he or she is probably fluent. If you do not spend much time “in the weeds” of a particular topic or area of focus, give yourself a quick refresher. Before interviewing an asset manager, make sure you know alpha from beta, Lipper ratings from LIBOR, and when you hear “PE,” how to determine whether it means “private equity” or “price-to-earnings.” In addition, take a look at what’s going on in the markets that day. If there’s been a headline-making drop in the Dow or a material change in oil prices, that context may be relevant to your discussion.

Listen actively, and take smart notes

Listening attentively takes focus and self-discipline, and is especially important during an interview. Resist the temptation to let your mind wander or think ahead to your next question. Truly good listeners don’t just remain silent while the other person talks; they ask follow-up questions to probe for additional information or better understand the other person’s point of view.

Speaking of retaining information: taking notes is a useful tactic, but it can also be a distraction if you’re preoccupied with writing down every response verbatim. Where possible, use a smartphone or a digital recorder. You can still take written notes, but having an audio recording for backup allows you to focus on the main ideas and most important takeaways instead of scrambling to capture every word. And if you use a recorder, glancing at the timer and writing down the time in minutes and seconds creates a useful marker for a point in the conversation you want to go back and listen to later, such as numbers or other details you need to verify before incorporating them in written materials.

Always end with the same question

Before wrapping up an interview, offer your SME the chance to expand upon something you discussed, or add an insight you may not have thought to ask about. Simply asking “is there anything we didn’t cover that you’d like to add?” may yield a nugget of brilliance–or spark an idea for your next marketing campaign.

Vested & Boston Private Win Best Financial Marketing Strategy Award

We are always proud of the work we do for and with our clients, and Boston Private is no exception. The partnership we have with the wealth management firm has allowed for a long and successful track record, most recently earning us the award for Best Financial Marketing Strategy for PR/Media Relations from the Gramercy Institute!

Vested was tasked with generating media buzz and public awareness around Boston Private’s study titled “The Why of Wealth.” The detailed survey explored why individuals are motivated to not just make money, but also why and how they choose to spend and save it. Vested also recommended and created a comprehensive but easily-digestible infographic (partially pictured above) to accompany the pitches.

What followed was a series of top-tier coverage in both financial and consumer outlets including The New York Times, CNBC, Business Insider, and others; sticky yet natural social media engagement; and most importantly, a larger conversation about people’s motivations and priorities when it comes to money. With the help of Vested, Boston Private was able to elevate and promote its brand, reach large and otherwise untapped audiences, and start an important conversation.

Vested and Boston Private join Citizen’s Bank and EMI Boston; Direxion Funds and Investing Channel; TradeStation and DiGo; Brinker Capital and Seismic; T. Rowe Price and IMPRINT; AIG and MERGE; Invesco and Deardorff; BlackRock Mindshare and Investing Channel; and others for this year’s Best Financial Marketing Strategy Awards.

The accolade is one of multiple over the last six months. Earlier this year, Vested won Gramercy Institute’s award for Top 12 Financial Marketing Agencies. At the end of 2018, our UK Director Katie Spreadbury was named as a Rising Star of Financial Marketing by the agency; and Vested was named a Top Place to Work by PR News.