I woke up this morning and read something by David Perell and Conor Witt about how the most precious commodity in finance will be trust. Now that all of the costs associated with investing are gone and the walls between our public and private lives have become permanently blurred, what will shine through is whether or not you are trustworthy and authentic. Are you real, can I relate to you, are you interesting, do I care?
Which is good news for my friends and I in the financial blogosphere, because we’ve made a lifestyle out of sharing and keeping it real. No media training, no publicist, no bullshit. This is what we think, take it how you want it, good, bad or indifferent.
This is easier said than done.
David and Conor point to two examples of what’s going on – my friend Meb Faber at Cambria and us in the Ritholtz Gang. I could name ten or twenty other examples, so I’m flattered by the inclusion.
Two firms, Cambria Investments and Ritholtz Wealth Management, stand out from their competition. Few firms command trust and attention like Ritholtz and Cambria. Through candor, authenticity, and consistent content creation, they are blazing the trail for future managers.
In 2016, Ritholtz Wealth Management was named one of the fastest growing financial advisory firms in 2016 by Financial Advisor Magazine. Four years after its founding, Ritholtz Wealth Management manages more than $500 million in assets. Called the “Wu-Tang Clan of Finance,” Ritholtz Wealth Management (RWM) is a collection of prominent financial bloggers. Barry Ritholtz, the founder of the firm, started blogging in 1998 out of frustration with misleading and superficial mainstream market commentary.
Through decades of sharing authentic perspectives through a myriad of channels, RWM has earned the trust of audiences and defined its investment philosophy. They’ve bypassed traditional media outlets and reach their audiences directly. As a result, the firm defies tradition. A recent quote from RWM CEO Josh Brown cuts to the heart of the Naked Brands thesis: “financial services was always sold on the basis of the reputation of the firm. And it’s not that that’s not important anymore. It’s [about] personality…people don’t follow brands, they follow people.” By fostering communication between advisors and investors, podcasts are the new word-of-mouth, and blogs are the new business cards.
Josh here – People don’t follow brands on social media, because brands are artificial constructs and remnants of the 20th Century. People follow people they like, people they trust and people that can educate or entertain them.
When I read an article about how Meredith Corporation is going to buy TIME Inc for $1.8 billion for their publishing business I laugh. How many people have subscriptions to these titles? 100,000? 500,000? a million? I don’t know. But I do know that Kim Kardashian has 105 million followers on Instagram. She added 765,000 in the last 30 days. Can you imagine her reach versus TIME Magazine’s. It’s like a joke.
Of course this applies to sports, music, movies, TV, finance, home improvement, cuisine, architecture, etc. Why wouldn’t it, the audience is people.
Go read the whole thing, it’s really well done.