“In the area of diversity, smaller firms have an advantage,” said Venk Reddy, founder of San Francisco-based Zeo Capital Advisors, a fixed-income mutual fund manager.
“Because each employee must wear multiple hats, we have a bias to look beyond experience alone. We value people who can be nimble.”
A team with ethnic, socio-economic, and educational diversity allows the firm to be more agile and creative to compete with bigger firms. For example, when doing credit analysis, the more ways you can look at something, the more risks you can identify. Having outsiders’ perspectives helps avoid common biases, he said.
“It’s about redefining what it means to be qualified,” Reddy said. “If we don’t [redefine], we’ll still hire from the same overrepresented demographics.”
To that end, the firm recruits for core skill sets over work experience, seeking candidates who are lifelong learners, are intellectually curious and have overcome life obstacles.
Reddy cautions that diversity for its own sake isn’t enough.
“It’s more than just checking the box. It’s constructive when you understand why you’re doing it. And to be creative, you need diversity,” he said.
“When you put all the different lived experiences together in an environment that is kind and inclusive, it’s like a chemical reaction. It leads to creativity and innovation. That’s important for a small firm.”
Contact Paige Uher, chief operating officer and chief marketing officer, at paige@zeo.com to learn more about its diversity, equity and inclusion initiatives.