A Bit of Optimism - Excellence with Silicon Valley Legend Jackie Reses

Episode Date: January 9, 2024

Lasting success requires innovation. But how do we build teams that keep innovation in their DNA?Jackie Reses is Silicon Valley royalty precisely because she knows how to hire, build, and lead the best teams for the best companies. Jackie was a senior executive at Yahoo!, Alibaba, and Square and now she is the founder and CEO of a new bank disrupting retail finance.We talked about what it takes to empower people to invent new things and how grit, paranoia, and excellence breed success.This is...A Bit of Optimism.For more on Jackie and her work check out: https://www.lead.bank/ 

If you want to learn how to build a powerhouse of a team, then listen to Jackie Rhesus. That's exactly what she knows how to do. Every project she's ever been involved in, the teams she built were remarkable. Jackie's a pioneer. She's well-known and well-respected in Silicon Valley. She's Silicon Valley royalty. That's because she held senior positions at Yahoo and Alibaba and at Square. And now she started a bank. That's right, a bank. And she took everything she knows about building

powerhouse teams from Silicon Valley, and she's applying it to an entirely new industry. And the Adults are remarkable. This is a bit of optimism. Jackie, one of the main reasons I wanted to have you on today is because you are a pioneer in a powerhouse. And you're like the Energizer bunny, which is you cannot sit still. You always have to be doing something. And that thing that you're usually doing is usually pushing some sort of boundary somewhere. Good way to describe it. Yeah. Right. So just let's, I want to give people a little bit of a, a little bit of a background, a little bit of a history on who you are, the short biopic on how you got to where you are today. So you grew up in New Jersey. I grew up in Atlantic city, New Jersey,

which is a very special place. So I'm not from the fancy part of New Jersey. Right. You're from real New Jersey. Yeah. Oh, yeah. What did your folks do? My mother was the president of New Jersey Pharmaceutical Association, and she ran a chain of retail pharmacies. And my father started a medical supply business that was very successful, but they really ran healthcare-related businesses. Having said that, I kind of left my house when I was 14. And so I learned a lot from my parents as a little kid. There are weird themes of entrepreneurialism that I really still take with me every day. But I also am built out of needing to live on my own when I was 14. And both of those dynamics show up in such extreme ways in

my life every day. What was it that had you leave the house around 14 years old? You know, I'm like a product of the 70s, bad divorce in the 70s that was asymmetric in financial outcomes. And if you think back to that era, it usually had a disproportionate impact on a mom because the, you know, someone at that time was taught to be subordinate financially. I don't think my mom had her own credit card or own financial history, her own anything, despite actually in a very fractured family everywhere and knew that the only way I was going to survive life was to get out of Dodge. My family is a little bit troubled and I needed to get out. And I sent myself to boarding school where I went to the petty school, which is in

the nicer part of New Jersey by Princeton. And I only went to three years of high school because that's all I could pay for myself. I mean, like I'm in, I was in a race to start working. Like how did you, how did you pay for it? Where did you have the money? So, so there's a 14 year old, you, you had the gumption to apply. I applied myself for high school to boarding school. I got into a bunch of schools, but they were much nicer schools in the Northeast. Petty was the one school in New Jersey. My parents let me go to school in New Jersey. And I knew enough to know that I needed to escape.

And that's the way I thought about it. to know that I needed to escape. And that's the way I thought about it. And I paid for school either by begging my way through tuition and coercing my parents in any given semester to pay for tuition or through businesses that I started that economically supported me in my day-to-day life that I would run from my dorm room in high school. Like what? So like softball in a milk can or fluky ball on the Wildwood, New Jersey boardwalk. They're like carny games. And so you can make a lot of money in these kinds of businesses, all cash. All you needed to do was get a location on the boardwalk. And I'm sure a lot's changed since I was mid-80s doing this. My brother and I had these two games, all cash business,

highly profitable. I ran an ad specialty business. I built Greek mugs and t-shirts and stuff for fraternities and sororities in college. And I just survived. I did what I needed to do to survive. But I largely raised myself from age 14 on and lived wherever I could live. My parents came and went. No one was in my house sufficiently in Atlantic City. They just came and went in No one was in my house sufficiently in Atlantic City. They just came and went in my home. I didn't know which parent was going to be where. So I raised myself from that age forward. And like Penn really changed my world. It really did. Like Penn taught me that there was a different universe of people that occupied the world and opened the aperture of my sight into understanding what you could do if you ran your own company.

And so I saw a little bit of it as a kid who worked for my mother and then really saw it amplified in understanding that like my college roommates and my best friends in college were people who like ran the world. And it was jaw dropping to me. And as someone who kind of had a chip on her shoulder and had to pay her way to survive, come hell or high water, I was going to do what I needed to do to make myself successful and not put myself in a position that I saw my mother and other of her friends in, which was that of reliance on someone else to support her economic viability and independence. That's what really drives me. I can't get out of my own way because of that history in terms of having a historic chip on my shoulder and knowing that nothing will stop me. I love what I do. I think

about it 24 hours a day. And I have a drive to keep going in a way that is at its extreme. Yeah. Can you tell me, was there someone or something that happened in college that really captures this jaw-dropping realization? I wrote a business plan with my college roommate, who's from Curacao, on starting a soft drink company. It was called Colita. we wrote this business plan and we were offered a grant to start this company. And at the time, this was pre-Snapple and it was for a watermelon flavored soda. So a very sweet fruit flavored drink. And when we were given the grant, I had a choice to make. Do I pursue entrepreneurial endeavors or do I believe I had more to learn? And at the time I knew I had the drive. I knew I had the curiosity and I knew I had the grit. Those things were obvious to me, but I felt like everything else was too scrappy for my own good. So I knew enough to be able to drive myself to a

different kind of environment of professionalism, which is really what the next seven years of my life was about. I spent the next seven years of my life at Goldman Sachs when Goldman was private, learning about teamwork, excellence, client service focus, building good relationships, watching people who were amazing at what they do, do their job and their craft. And that was like the next phase of my life lessons. So if Wharton changed my perspective to be global, Goldman taught me about excellence and teamwork. And so I worked for a guy named Eric Dopkin. He's kind of deemed with the honor of crafting the idea of the modern IPO.

And he was the toughest person I've ever worked for in my entire life. Honest to God, if I didn't get yelled at every day, it was a boring day. But by God, did he teach me about excellence and being amazing at his craft and having people respect him. He's an amazing mentor and he took me under his wing and just taught me everything about how to be really good at your job in the best of ways. What was your job at the time? Oh my God, I was an analyst.

I was like a kid. I was a junior person at Goldman Sachs when there was no such thing as Excel. We used Lotus. So like God only knows what I actually did, but I analyzed deals. I invested for Goldman and I got beaten up every day by the partners at Goldman Sachs to kind of teach me how to do finance and tax and structuring and all kinds of stuff like that. And where did your grit come from? I mean, I guess I know the answer here, but like you got beaten up every day, but did you enjoy it or were you trying to prove them wrong? I loved every minute of it. Eric Dopkin changed my life by teaching me that I just needed to

work a little bit harder to deliver. The grit isn't something that can be taught. You either have it or you don't. And I think it's one of the most important contributing factors to a person's success. They truly have the will to succeed and it's embedded in their DNA or they don't. And I think you can teach execution skills. You can teach leadership skills. And I think you can teach execution skills. You can teach leadership skills. You can't teach grit. And because of how I grew up, I have it in spades.

So what was the reason you left Goldman Sachs? I left Goldman because I was successful there. And I thought if I didn't leave, I was never going to leave. And I didn't want to be a lifer at a big institution. I needed to live in a more entrepreneurial world. Yeah. And I reached a point in time when I could see how more senior people got fat and happy with the lucky benefits of Goldman as a private company. Yeah.

And it's too easy to rest in companies like that and not take risks. And I have a risk orientation that most people don't have around wanting to start companies, wanting to start new things. And Goldman was starting to get too comfortable. And so I left at a point in time when I was exceedingly successful and being rewarded for my success. And that terrified me. Even now today, I run my own company and I write our monthly board letters that sometimes sound like we've had another amazing month and it terrifies me.

Something's going to happen. It scares me because I live in a world of extreme paranoia where if things go too well in certain elements of your business life, you know you're going to get punched in the face and have something happen that knocks you back a few pegs. And I think that keeps me paranoid. It keeps me humble, and it helps me push forward in a very entrepreneurial way where the only thing I'm fighting is myself and my own creativity, not someone else getting in my way. Maybe that's a wackadoodle philosophy or a very paranoid philosophy. Well, I think your paranoia, what it does is it, you said it, it keeps you humble, right? Which is you don't fully take credit for all the success, which means you can't relax, right? Because you and I both know people who did really well, some because they're smart and mixed

with luck and all the other things, but they sit back and they get lazy because they have money, things, but they sit back and they get lazy because they have money or they live on the past. They talk about all the things that they did do, but they haven't done anything in years. And there's a lack of humility. And I think that's really amazing. I think it's really funny that they have a lack of humility, even though they're not doing anything. I appreciate the push and the push and the push because it could collapse at any time, which I think makes you defensive as well, which is not only offense, the best defense is offense. And so you're playing offense the whole time. life at an extreme degree such that I don't separate the two. Therefore, I don't think about work as work. And so frankly, it's one of the only challenges I have as a CEO and founder of a company because I work every day, all hours. And sometimes I find it hard to deal with when people like don't respond to my messages on weird hours and they have their own different approach to life, which

is different than mine. And you kind of expect people to work your hours. No, I don't. And I, just like I don't work someone else's hours, I don't expect them to work mine. I guess I live in a free form work environment and I love what I do so much. And I always have that I only want to surround myself with people I enjoy. Let me back up for a second. Let me back up for a second. There are very, very good people who don't want to work on weekends or the evenings are for their families. work on weekends or the evenings are for their families. And when you send emails at night or on a Saturday and they don't respond or they feel the pressure to respond, I mean, you being the CEO,

there's an inherent discomfort or pressure that you're putting on people. I appreciate that you say, I don't expect them to work my hours and I shouldn't be expected to work their hours. However, when they put no pressure on you to work their hours, but you accidentally do put pressure on them to work your hours. So I try not to do that. I understand it. I acknowledge it. And I think, unfortunately, a lot of people pay attention to it and feel pressure. I do say to people, don't worry about when I send this stuff. I blurt out thoughts and I put them on electronic communications as it comes.

And do what you got to do with things that are important in your life. And I'm fundamentally a decent human being to work with. I like that people have fun with their kids. I truly am. I'm not a tyrant. I'm not like a nut job. I'm a pretty mom-like CEO. I mean, having said that, we're not a family. I run a company. We're performance-driven. I definitely don't run a family. And by the way, I do think there's a huge distinction. And I want people to live the life that works for them, but I also would like them to deliver. And I hire people for grit, raw intelligence, and work ethic, even if their work style is very different than my own. I have a woman who is an engineer. She's

now a product manager. I'm not sure she has a home location. She's like a traveling circus with her fiance where they're always somewhere else. And I'm amazed at how she lives her life because I couldn't imagine being 30 something and living like this. And she embraces being everywhere in the world and traveling around. But my God, is she smart and talented. And I would hire her all day long versus someone who's sitting in a local office showing up just because they think that's the right thing to do. She has like an extreme work

from home style, but her ability to deliver because she knows she has the discipline in her own life is so extreme relative to other people. And so we hired for that kind of raw intelligence and talent in the way that she operates. But I don't like to hire for skill. Yeah. I like to hire for intelligence and grit. Yeah. And skill, I think, leads you down a wrong path when your job is to invent new things. Yeah. Because there's no historic skill that you can often hire for that yields new inventions.

Yeah. Like if you're going to create something new, you can't do it with people who know how to do something and have done it for 30 years. You have to do it with someone who can look in first principles and deconstruct a problem. And with intense level of curiosity, figure out how to do it better in a way that no one else has ever thought about, because they don't even know that they're not following the rules or following the prescriptive way that it's been done before. I think what you're talking about, and it overlaps with grit, is discomfort, right? Because with skill, with experience, with success comes comfort you talked about the

Goldman Sachs you know they get fat and comfortable and I think the uncomfortable or doing things that are uncomfortable that is going against your skill set right because leaning on our skill set is the thing that is comfortable I know how to do this I'm going to do this I'm good at this absolutely yeah And the more you push into uncomfortable, the more creative you could be. Yeah. Like how do you come up with something that's wholesale new and be able to keep that as a system, as a framework in a company? And that requires a certain breed of people to operate who like pushing boundaries and like creating wholesale new. And that's things that are not skill-based. They're core level skills about who a person is. How do you reward and incentivize a willingness to be uncomfortable?

Because you can incentivize it out of people pretty easily. Yeah. I think as a company, you have to systemically root out frameworks that don't create an environment to be creative. By that, I mean like- Give me a specific example. Do you have a budgeting system that only rewards bigger budgets, more headcount? You only get headcount when your big product grows and gets bigger. That's only going to yield people who aren I willing to rigidly stay in line to what I prescriptively said I would do when we set that OKR. How much ability do I have to pivot because there's something better? And as a company, you can reward things like that,

or you cannot. And you have to make sure that you're always evaluating places to root out problems that don't allow for creativity. And I also think anyone can give you feedback that's useful. You just really have to listen. Now, I like sitting and listening to people who I work with and understanding what's on their mind, where they think they're having problems, so that we can make what we do better. And then I like to give people agency to fix it. I had a very funny moment at Square. I ran HR at Square. It was one of the functions I ran.

And I used to meet with every new employee at Square. And I remember starting part of my conversation with every new hire by saying, you're about to walk into this company that is revered and has an unbelievable brand in the market and a lot of notoriety in the tech community because of Jack and because of the technology that Square created around mobile payments. Having said that, you've just joined and you're about to see the nuts and bolts under the covers that this company has run on like a bunch of Google Docs joined and you're about to see the nuts and bolts under the covers that this company has run on like a bunch of Google Docs, and you're going to be appalled at what you see when you get here. I said, when you see that, your job is not to look at it and be appalled.

Your job is then to just go fix it because we're still at this intense level of growth and company building where it's not one person's job to go build the company. It's everybody's job. It's a moving organism. Every level of a company has to get 10% better. Otherwise, you're not evolving as an organization. And it can't just be the executive team that pushes this down. It has to be from the most junior person on up. I think a lot of leaders say that, but the incentive structures inherently don't support their words, where usually the incentive structures are performance, not improvement. I totally agree with you. What did you do at Square that the incentive structures promoted behaviors that aligned

with your words? One example would be, do you reward your best leaders and make their teams bigger? And that's a persistent ability and execution strategy for showing people they're great at their job? Or do you take the best leaders and give them no team and the most important new project in a company, which is the new S-curve for growth? You should be giving those leaders no team, no budget, and an idea. And if you do that enough times, you've just shown the company that when you're good at what you do, you get to work on a new invention and start over. You get to do work on the juicy stuff. Amazing. Go invent something new. And that is antithetical to a lot of companies

where the best leaders are rewarded by bigger teams, bigger budgets, and then they stay there like an ossified leadership structure that never changes. That's such a good observation because the thing that excites us when we're younger and hungry is the difficulty, is the need for invention and creativity. And then, as you said, the incentive structures encourage me to be fat and lazy. Yeah, totally. And then we talk about the good. Remember when we lament the good old days when it was more fun. I might not make as much money. I might not do this, but my days when it was more fun. You know, I might not make as much money.

I might not do this, but my God, it was more fun, you know? But like, I would go take the best person off their team and give them something new to start that's really impactful for the 10-year plan of the company. Yeah. You come from big tech. You understand big tech. You're very well known in big tech. You You come from big tech. You understand big tech. You're very well known in big tech. You're admired in big tech. What was the reason you started a bank, a retail bank?

I see a problem in the world right now. And I see an evolution of the way finance is starting to happen, where consumers and businesses are starting to change the way that they operate in the banking system. And I have a philosophy about the way the banking system operates today, which is very closed loop, closed system. You go into a bank, you operate in a very tight, controlled environment, to having banking happen everywhere. And the primitives that we are building in banking to enable any company to have banking anywhere will totally change your ability to not even realize that you were banking or pursuing a financial transaction. But it'll make your life easier in such an extreme way in

the future that you'll just be thankful that the financial transaction happened. It knows you, it knows what you need. It could smooth out your cashflow, make your life just more seamless in how you go about your day-to-day interactions. That's the thesis of what we're building at Lead. That's genius. But we're only in such early innings of that. There's no artificial intelligence applied to how you manage your life. Do you know how much you can spend? Yeah. Can you finance things after the fact because you might be a little tighter? Can you pay your rent

through an app and have it financed? Like, holy cow, is that cool? Like you have this mismatch of when money comes in versus when money goes out that you now are able to live your life without worrying about going under because we've always lived in a world where zero was punitive in our wallet. Above zero, you have money in a savings account. Below zero, you're in default or you get assessed a charge. We're moving to a world where zero is irrelevant and you should be able to save and make more yield or finance because it's convenient until you get your next paycheck. That's a concept that you can't do today in your wallet. That's genius. Right? It's all disaggregated. You have credit

cards, you have a wallet, you have high yield stuff, you have a bank account. It's all disaggregated. At some point in the next 10 years, it'll be more cohesive and make your life easier. some point in the next 10 years, it'll be more cohesive and make your life easier. Can you give me a specific example of something you've done in your career? It doesn't matter if it's commercially successful or not, but something you've done in your career, a project that you worked on, something like that, that if everything you ever worked on was like this one thing, you'd be the happiest person alive. I think starting my company. When we started Lead, I was joined by three co-founders, Erica, Ronak, Hamam. They all worked at Square. What I thought was pretty magic and probably not replicable for us was that I was able to start a company with three people that I have so much trust and respect for that it made it a shorthand around all the challenges when you start a company. It's the most lonely thing in the world. It's the worst. At your extreme, you're shown your worst fears in starting your own business.

You are faced with failure every day. But when you can do it with people who you love and you know they're your best partners, it is a gift. And I mean an unbelievable gift. Because I had the ability to basically cry on the shoulders of people who knew me well enough to be able to pick me back up and push me forward and vice versa. And we have no problems pointing at each other and saying, what you just did was stupid. Like, oh my God, you got to go fix this, make it better. Because we have such a high level of trust and shorthand with each other. It's very hard to replicate this situation.

And you've never had that before in all the other incredible jobs. Never had this level of trust in such high stakes situation. And I only want to work with people situation. And I only want to work with people that I trust and that will call me on my own garbage. These folks call me on everything and vice versa. Can you tell me an early specific happy childhood memory? I remember learning how to ski as an 11-year-old. And my parents were not athletic. It's interesting because I knew that skiing was a lifelong sport. So I used to go away on bus trips to Camelback and Hunter Mountain. I was probably wearing jeans, but my parents didn't teach me. mountain. I was probably wearing jeans, but my parents didn't teach me. It's one of my earliest memories of saying, I should know how to ski. It's going to be a really important sport to know my entire life. And I taught myself to ski and went with different student groups to go learn how to

ski. Same with golf. When I was 11, I learned how to play golf. And I kept saying to myself, this is going to be an important life skill. I should learn how to play golf. But I think I knew enough as an 11-year-old to know that I was on my own, to have the maturity to know that there were some things you needed to do to play the long game. But I knew that these things would be life important from a relationship point of view. And I, it's weird. I like, I just had this weird sixth sense as a kid on like how to play the long game with investing in things that I thought would be important for my life over, over, over the lifetime. the lifetime. I don't know. It's weird. Do you know what's really interesting about the telling of those stories?

You said, I knew I had to learn to ski, so I taught myself how to ski, you said. And so I went on bus trips with other people. And your sense of I taught myself is not actually true. You didn't teach yourself. I taught myself how to ski would be like, and I went up and down the mountain myself a thousand times until I figured out how to learn how to ski. That would be, I taught myself how to ski. And then I raised myself by going to boarding school. It's just this very interesting, the way you describe, I did it myself. And then in almost every circumstance, you say, and I went to people who knew more. I went to people who took me under their wing.

But you always said, I did it myself, which is actually not true. You're so right. And this is better than therapy. I agree. What you did do is you pushed yourself off the cliff. You're so right. You never did anything yourself. You ran to people who could teach you. So when you talk about one of the greatest memories you have in your incredible, remarkable, illustrious, fantastic career was once again teaching yourself how to ski, raising yourself and starting your own bank. But in reality, what you did is you rushed to people who you trusted and

loved and you did it together. You didn't raise yourself. You grew up with some wonderful people at Penn and you grew up with some wonderful people at boarding school. You didn't teach yourself how to ski. You went to some wonderful people on these bus trips and you did it with them month after month or week after week. And you didn't start your own bank. You started with a group of people who you love and who love you. And you're really a lot less of a lone wolf than you think you are, but you are a remarkable, remarkable team player who understands the value of love and trust. And you've done that repeatedly. And when there is no love and trust in your life and you realize you're stagnating,

you go looking for the love and trust that you can take yourself to the next level you need to go to. This is better than therapy. I'm going to have to take this podcast to a therapist. This is amazing. You're so right. And one, I'm going to change the language I use to describe like my entire life. I think the only thing I did myself was have the internal drive to find people who could help me because I did not have the structure in my life that was natural. Yes. That was apparent. Yes. And instead I replaced it with structures of excellence that appeared in all different forms, whether it was a company, a school, partners, colleagues, friends. Yes. I've learned a lot today. Where you get a lot of credit

is the foresight that this matters and no one's going to do it for me, so I better do it myself. But you didn't actually do it yourself. You found the people who could do it with you and for you and take care of you. But you do get credit for recognizing it and jumping off the cliff yourself. A hundred percent, You get that credit. Do you always have therapy sessions in your podcast? Cause this was pretty magic. I mean, occasionally. I am very thankful for you.

Great. I'm thankful for you, Jackie. I am such a fan. Thank you so much for coming on. I really appreciate it. Oh, thank you. I literally, you've given me so much to think about. It's weighing on me in a magical kind of way.

Wonderful. Wonderful. If you enjoyed this podcast and would like to hear more, please subscribe wherever you like to listen to podcasts. And if you'd like even more optimism, check out my website, simonsenic.com for classes, videos and more. Until then, take care of yourself. Take care of each other.