Don’t Get Distracted by the BS
On Tuesday, I wrote a holistic analysis of Silicon Valley Bank’s collapse (ICYMI, read that story here).
The critical takeaway: The industry needs diverse perspectives to solve a problem effectively and tackle it from all angles.
What seems like a simple solution is frequently twisted by doom-and-gloom narratives that aren’t based on anything factual but are created as a distraction. For example, the countless callouts by major media outlets like the Wall Street Journal and Fox News that SVB’s focus on “wokeness” led to its downfall.
As my favorite New York Times columnist Jamelle Bouie put it, wokeness is “a word that signifies nothing other than conservative disdain for anything that seems liberal.”
Including diversity initiatives.
There is no evidence that any diversity, equity, and inclusion initiatives were responsible for the collapse of SVB. The real story behind the failure of SVB has much more to do with the regulatory and economic environment of the previous decade than it does with diversity.
Instead, I would reverse the thought and suggest that we could have avoided last week’s events if our society more holistically met diversity demands in all forms.
The reality is many factors have contributed to the company’s downfall.
And the big kicker? The core of this collapse is due to the 2018 Trump-era rollback of various regulations, including the Dodd-Frank Act, of financial institutions like SVB. These were the same rules put in place because of the 2008 financial crisis, which happened because of the – primarily white and male – teams of Lehman Bros, Washington Mutual, Bear Stearns, etc.
If these regulations hadn’t been rolled back, SVB and other banks like Signature, which collapsed, would’ve been subject to more substantial liquidity and capital requirements.
This shows you what the people at the top will do to distract us from understanding the truth, and they’ll leverage “wokeness” to fix the blame instead of the problems.
Don’t get distracted by the noise…
The biggest mistake people make in a crisis is not knowing they’re in a crisis.
Our industry typically sees diversity as a side-bar conversation or a “nice to have” that can be ignored until profitability has been reached, which completely contradicts the facts.
This is our crisis. Study after study has shown that having a more diverse workforce leads to better business outcomes and higher profits.
If I can be honest with you for a second, I do my best and work my ass off to share diverse opinions, analyses, and perspectives that aren’t focused on the next growth hack or doom and gloom headline every week.
Instead, I dedicate this platform to long-term and sustainable solutions like diversity, behavioral finance, and transparency.
These solutions are complex and multi-layered and require a higher level of EQ skills to understand, let alone acknowledge. And because it’s not a simple solution, my content never goes viral.
I relate to the fintech founders who are building solutions that solve problems to fix the shaky foundation on which our industry stands in a world where the shiny new tool gets all the funding and press. For that reason, I have stopped chasing virality (although I have to admit I struggle with this still).
Wise words that have stuck with me throughout my career: It’s much easier to be cynical than aspirational, and it’s why cynicism often goes viral while aspirationalism doesn’t.
This rang especially true as we saw how far the industry’s elite would go to maintain the status quo and keep everyone else left behind. When faced with meaningful commentary and disruption, people will often try to distract us with noise and issues that don’t bear relevance.
It’s our job to arm ourselves with the values that matter and the proof to back them up. Focus on building a community around you that enables you to uphold those values instead of chasing virality. Let the words and perspectives of that community impact you more than the trolls.
We must double down and stay focused on the bigger goal, never letting the opposition take away our power. We must invest in marginalized communities and support the founders and venture capitalists seeking to make a lasting, positive change.
It’s up to all of us to ensure that diversity is represented and that businesses receive the recognition they deserve. Working together can create a strong and sustainable foundation for our industry.
And this conversation doesn’t have to end here. So let’s bring the community together and get into some real talk about the future of our industry and what needs to be done to create change.
I’m hosting a virtual event to do so. Join the conversation here.
Thanks for letting me get real here. And if you feel the same, you can always reach out to me for a chat.