Data Driven Investing

Dive into data driven investing techniques from risk management and private fund expert Beth Pollack.

Beth Pollack is the Founder and Operating Partner of K Means Capital, an advisory and investment platform focused on data science-driven business planning, product strategy, and process enhancement.   She has 20 years of experience as a deep diligence investor and decision system developer on both the sellside and buyside including 7 years at Goldman Sachs.   She holds a graduate degree from MIT and an undergraduate degree from Rutgers University.  

We dive into measuring risk and finding the data you need to make smart investment decisions that align with your expectations on volatility, correlation, liquidity and max downside. Beth shares her experience in risk management and private funds to inspire the next generation of investors.

Eve #WealthWednesday Highlight #24: Beth Pollack, Operating Partner - K-Means Capital

What was your first investment?

My biggest and most impactful investment was pursuing my MBA because I put myself through school and made it through recruitment season to get to Goldman Sachs. It was a huge risk since I was the first in the family to go to college and I had put myself in debt to go to graduate school. At the time, I felt it was necessary to “pay to play.” When I was at Goldman, I spent a lot of time looking at Seadrill bonds, an oil services company. I thought that there was high risk, but a likely great return and it felt like I had good timing. I wrote my entire thesis and presented it to the trader which got put on the books and luckily it ended up working out.

You have to start somewhere, just make sure you are thorough in your research and diligence and honest in your analysis of the options available to you. 

How/why did you get into your space?

I was 19 years old when I fell in love with the markets. I was reading the newspaper and scanning headlines to follow the numbers and data to figure out what was truly going on. I wanted to access the best possible information I could and really dig deep. I found tracking the changes across different markets fascinating because understanding it required a mix of psychology, sociology, macroeconomics, and your own natural resourcefulness. I made sure to intentionally position myself somewhere where I could get training and access the best quality information. It was a long process, but so worth it. 

What role do you play in the wealth space and why is it important?

I've always had a hybrid role as both an investor and a data-oriented operator. Maybe it was from a combination of building a business, improving operations, and accurately analyzing a company. I’m now functioning as an operating partner and I'm making the most of private equity firms' investments. I help executive teams make the best decisions they can and I do this from a data-driven perspective. 

What do you believe is the most exciting thing you’ve learned and want others to know?

Finance in general can be really intimidating with a lot of jargon and a high barrier of entry, but I’ve found in my time in the Eve Wealth community that you make resources and financial literacy more accessible, especially when I’ve been part of Eve Circles. Eve directly addresses the emotional link that women have with money, which adds another level of complexity to what's already a hard problem.

When it comes to finance and investing, try not to get intimidated because you can break it all down into pieces. Take it one step at a time because no one has the right answer for every situation. Everyone is operating under different parameters and no one is an expert in every area.  

Who is a person or company that inspires you in the space and why?

I changed my focus on financial data to healthcare data, which has been very timely with everything going on in the world. HealthTech has experienced exponential growth because of the sheer amount of healthcare data that is now out there. One of the reasons why I chose to shift my focus and narrow in on healthcare data is because the founder of one of the companies I work for is a Harvard epidemiologist. He was a big tech guy in the 2000s and decided to prioritize his focus on better healthcare decision-making.  

Overall, I’m really inspired by this idea of using data to make better healthcare decisions. It relates to the notion that you will only be able to make better decisions if the company is run well and if they're growing and doing what they've promised to their investors. Everything ties back to finance. Companies and founders need the capital to succeed, to prove themselves so they can get more capital and really make a big difference in their industry. If the investments you're making are tied to companies that are scaling their impact and employing many people who can then feed their families, the results become bigger than numbers on a piece of paper or any sort of monetary return on investment.

What advice would you give to someone getting started?

I spent 20 years focused on risk management. Again, I highly recommend thinking about the different components that go into making an investment and then breaking it down into smaller pieces. Compare one opportunity to another to understand your specific needs and how volatile the space can be. Whichever private investments you might have, whether they be in real estate or something else, it may take either five years to ten years until you get your money back or see any sort of return on investment.

You should be ready and assume that sometimes your money is not going to come back and you have to be willing to take some risks. All private equity or public equities can go to zero at the drop of a hat if a company defaults. I’ve seen the bonds end up getting the keys and the equity gets very little or nothing at all.

Ask yourself if you can lose the money you're investing before you commit it. Compare the upside and downside so you’re taking into account all considerations before you make a decision and take action.

Anything else we should know?

I'm on LinkedIn, and the name of my company is K-Means Capital, which is an advisory firm. Would love to connect! 

#fintech #womenswealth #futureoffinance #investing #investment

---------------------------------------------------------------------------------------------------------------

Have thoughts on this week’s topic or questions for me or Beth Pollack? Post your thoughts in the comment section. Until next week. 🙂

You can connect with Beth on LINKEDIN

Follow Alana on LINKEDIN for the latest news in #fintech