Social Impact Investing With Neil St. Clair

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TSP Neil | Social Impact Investing

Episode Summary:

Doing good and doing well is a philosophy that all entrepreneurs with a philanthropic side want to do, but there are so many ways to approach it. Neil St. Clair does his share by removing fear from everyday life through social impact investing. Neil is a serial media entrepreneur, senior marketing and startup advisor and creator of the “Intrigue Marketing” philosophy. He is currently leading the launch of a global media network focused on “investing with impact.” As a former journalist, Neil knows the value of telling a good story and he uses this ability to pitch venture deals and get high-net worth people and organizations to get into social impact investing. Listen as he joins John Livesay to share his story.

Listen To The Episode Here:

Social Impact Investing With Neil St. Clair

Our guest is Neil St. Clair. He has a lot of great philosophy here about doing well and doing good. Social impact investing has always been at the core of who he is. He has a great suggestion, which is that we write our obituary and create goals, so we meet how we want to be remembered. He tells us about verbal judo, leaving a little surprise to create that wow factor when you give a pitch. You’re going to want to be sure to find out what that is. Enjoy the episode.

Neil St. Clair is the President and Founder of NES Impact, which is a management consultancy firm and they work with single-family offices to help them develop social impact goals. They’re not only investing the money but money having a social impact. We’re certainly going to ask him about that. He also serves as the President of Child Safety Pledge, a nonprofit combating child sexual abuse through storytelling and impact investing. Before that, he was the President of Karma Impact. It’s a media platform for the next generation of private impact investors.

He’s hosted several shows for the network, including Timeless Media. He was the first-ever Chief Growth Officer for a venture-backed AR marketing platform and served as the first-ever Director of Marketing for over $11 billion. Earlier in his career, he was an on-camera news journalist. You can tell by his handsome face that that is the case. He’s also been at the forefront of a lot of award-winning media outlets. He’s a speaker that presented at UPenn’s Wharton School and Bloomberg News to name a few. Neil, thanks so much for coming on the show.

It is my extreme pleasure, John. I got out of TV because I had a face for radio and now this is a podcast.

You graduated from Boston University as magna cum laude. You went on to go to Yale. You clearly have a competitive edge as a marathoner and choosing to live in Manhattan. It’s the make it there, make it anywhere. Would you share with us a little bit of your own story of origin? You can start in college. You can go all the way back. Where did you get this drive to make a social impact?

I’m a Jersey boy for better or worse. A lot of us that come out of the garden state have a little chip on our shoulder as we stared across the river at Manhattan and wondered, “What if?” A lot of it is instilled values from my parents. Some of that is also natural. I spent a lot of time thinking about the science and art of ambition. What drives somebody to pick themselves up out of their circumstance? Why sometimes people that are born into great circumstances don’t have that natural ambition? A few years ago, I did two exercises. I would recommend this to any of your readers. The first one’s a little bit maudlin but well worth it, which is to write your obituary.

Do well and do good. Click To Tweet

Imagine your death at 100 years and work your way backward from that. What are all the things that you would like someone to say about you as your final act? Take that literal lifetime goal and break it down into yearly, monthly, and the actual week by week, day by day, and sometimes even hour by hour execution items. You’ll find that there are many little things that you can do to start to agglomerate and lead a great life. It also helps us offset procrastination. There is a lot of science around that setting moderate goals that have an almost cocaine effect. It releases dopamine when you achieve those goals but if you’ve set something that’s massively large for yourself, you’re less likely to ever even get started.

That’s one little ordering principle. Beyond that, what started me down the path of social impact was about a few years ago I said to myself, “I do believe that doing good and doing well is an equation that rings true, but there are many directions that I could take with this. How can I put an ordering principle into a place that’s going to be my philosophy of life?” I looked at a variety of things and finally came to a simple conclusion, which is that everything that I do philanthropically, investment-wise from a career perspective must be one simple thing. I must remove fear from everyday life.

That ordering principle has given me so much opportunity, but also so much direction. It’s flexible. It allows me to sometimes make my own definition and say, “Is this fear from physical harm?” I do a lot of work in the child sexual abuse prevention space. Is this removal of fear, say economic fear? There’s a great index at the Chapman University in California that puts out the top fears for Americans. You find political corruption, environmental change, and fear of not having the money for the future tend to be the variations of a theme of the top five going back twenty-some odd years. That plus an action-oriented way of thinking about my life has given me a social impact undercurrent but real ways and means to achieve that.

I’d be doing a disservice if I didn’t say that part of what woke me up to this was working with multibillion-dollar families like The Hinduja Family. The founding family, at least one member of the AllianceBernstein, the investment bank, working with them and seeing how they wanted to put their efforts into action. They didn’t want to sit on their money but wanted to go out and prove that equation of doing well and doing good. I’ve subsequently become involved with several networks like Nexus and Concordia that have similar outlooks. It’s been phenomenal to get involved and see that. Maybe this Gen Z/Millennial generation is going to put this into practice and help change the world.

I love what you are encouraging us all to do by writing our obituary so we can create goals to get there. It’s reverse engineering, which a lot of startups do. They like to reverse. What do we want this product to do? When I gave my TEDx Talk, I remember the coach said, “Reverse engineer your talk. What do you want the audience to think, feel, and do at the end of your talk?” You’re saying it in a bigger picture. What do we want people to think, feel, and do about us at the end of our life? I thought that was a unique way to do that. You have this quote on your LinkedIn profile from Churchill, “It’s better to be making the news than taking it, to be an actor rather than a critic.” Tell us what does that quote mean to you and what made you pick it?

It means a lot. I came across it while doing some work for my undergraduate thesis many years ago and I let it rattle around in my brain. It was written by Churchill in a book that he wrote when he was a young man called The Story of the Malakand Field Force. He was coming back as a young lieutenant or colonel from the Boer War and was just getting into the political realm. This was his clarion call to himself into his generation to get involved and not to be swept up into action by others. He actualized on that in a big way. That quote, as it bounced around in my head has led to two momentous shifts in my life.

TSP Neil | Social Impact Investing

Social Impact Investing: When you work backwards from what you want your life to be at the end, you’ll find that there are so many little things that you can do to lead a great life.

 

I like to think that post-college had three acts in my life. The first was as a journalist storyteller. The second was as an entrepreneur. I’m now in the third act as the gray haired disseminating my knowledge. I’ve got to figure out what I want to do with the rest of my life. All that aside, I was starting my life as a TV journalist. I was with YNN in upstate New York and Binghamton. I was promoted and worked in New York 1. At a certain point, there are a couple of other factors in this. Let’s not kid ourselves. Being a TV journalist until you make it big time is not the most lucrative way to build one’s life. Beyond that, we become increasingly frustrated by telling other people’s stories and not writing one of my own.

This quote started to bind around in my head, to be an actor and not a critic, to start making the news, and to not simply take it. It was at that point that I decided to take a break. That’s when I went into graduate school at Yale and that’s why I said, “I’m going to start my own company.” I did that first one almost the same day that I made that momentous decision. We were incubated at Yale and spent about two years on it. I was a peer-to-peer marketplace for buying and reselling hotel rooms. It was a wonderful abject failure. I’m happy to have at least one of those under my belt. You learn infinitely more from failure than from success.

I’m in the process of writing a book about the science of failure. There’s this interesting psychologist, to give you a quick example, the smartest people in the room, let’s call them venture capitalists in this scenario, or let’s call them the heads of major movie and TV studios. They get it right 1 out of 10 times. That’s success. Yet all we try to do in almost all aspects of our lives is model success, but success is the random factor. Failure is more mathematically predictable and there are ways to minimize failure than maximize success. We’ve been getting it wrong for a long time and the way that we’ve been thinking about how to go about our lives. There are more to come on that at some point. I’m in the process of collecting stories and architecting that a little bit more.

That quote drove me out of journalism and into the do part of my life as an entrepreneur. I went on to have a couple more successful companies. It also spoke to me again later in life when I was working with the Hinduja Family on Karma Impact as part of Timeless Media and Timeless Capital. I love the work we were doing. It’s meaningful but we were telling stories of social impact and social investing. I said, “I want to do social impact and social investing.” I had the capability to do that. I left there and went to go work with the daughter of the Founder of AllianceBernstein on child sexual abuse prevention.

We created the first-ever matrix to allow people to invest in both private and public capital markets in child sexual abuse prevention. We did some other cool things while we were there. It was that quote that started creeping up again, saying, “You’ve got to do. Don’t just tell the stories.” That’s not a knock on journalists. I have an extremely soft spot on journalists and they’re getting a bad rap now. Storytelling is immensely important and can be completely impactful, but once you’ve done that for a while, it behooves yourself to circle back into the active part of life and have other people look at you and say, “Can I tell your story?” That’s a yardstick for me.

I wanted you on my show so you could tell your story. You’re not reporting on someone else’s story. I’m fascinated by yours. Now that you have seen both sides of storytelling, people present ideas and startup ideas because you’re always looking for things to possibly invest in, whether it’s your own money or the family-offices that you represent. What do you think makes a good pitch?

Write your own obit and set goals to meet it. Click To Tweet

A couple of things and this took a lot of years of trial and error of having been an operator and subsequently having been an NLP in various venture funds or looking at it from an investor’s perspective. It gave me both sides of the equation to finally understand what I was sometimes getting wrong. I was pitching for money. The first thing, and a lot of us are guilty of this, is being short and sweet, especially when you’re dealing with investors, whether they’re venture capitalists, family offices, direct investors, it doesn’t matter. Whether they’re right or wrong, they think they’re the smartest person in the room. When you have that syndrome, listening to someone drawn on and on with rare exceptions, all you’re doing and I’m sure we’ve all sat on the chair at this point, where all you want to do is jump in and state your opinion or, “Have you thought about this?” They’re patient and respectful. What’s the TED rule? Is it twelve minutes on stage, no more or something along those lines?

My TEDx Talk came in under twelve minutes.

That’s a well-honed, true, tried, and tested rule. Twelve to fifteen minutes max is the true attention span. The shorter, the better. It’s one of the most amazing things you can do. Think of it almost as a verbal judo. Twelve to fifteen minutes, knowing that you’re leaving a couple of key points out because they assume that you’re on a pitch with a Q&A session. You won’t be comprehensive if you don’t have that Q&A, but draw someone in. Leave one slide in the appendix that you know is a killer slide. When that person or investor said, “Have you thought about this?”

You say, “In fact, we have.” You pull up that slide and knock them down. I will tell you that having been that investor, I love that because that shows that you anticipated my question. To be drawn in and have that question answered in such a prepared way and not someone that’s clearly bluffing. It’s clearly thought out, gave me a short enough presentation that I got it already, and knocked me over the head, I’m like, “I’ve got to learn more about you.” That is one of the things that investors are often looking to challenge you on. They like to play these games.

I love that so much because I’m constantly teaching people when I tell specifically sales teams that you’re selling yourself when you pitch to get funded, you’re selling yourself to get hired or get a new client. You must tell stories to become magnetic. Showing someone that you have thought out a potential question and have a slide ready to go as the answer is much more powerful than telling someone, “I am someone who uses critical thinking.” When you show it in, as you said, verbal judo almost, the energy is going back and forth. To me, a great story, a great pitch is all about having a collaborative conversation. The potential buyer or investor leans in and goes, “I want to know more about you.” You’ve intrigued them enough to pull them in. That’s what great storytelling does. I love this analogy that you use of saving a little something for the wow factor. It’s almost like dating. You don’t want to tell everybody everything about yourself. Intrigue us a little bit more that there’s something else. It’s this and more.

You’ve used my favorite word. If you go to NeilStClair.com, which frankly needs to be updated, I came up with an idea of something called Intrigue Marketing many years ago, which leads to this. It is to leave a little something out. Human beings are social animals and I have seen that concretely now in the time of COVID how social we are. We want good stories. We want to be surprised. Why do we go to the movies and see a horror movie where someone’s going to jump out of the darkness? Why do you think Steve Jobs or that television detective from back in the ‘70s would always say, “But wait, there’s one more thing.” That was always the thing. Psychologically, when you write an email to somebody, the one thing that almost everybody remembers is the PS. Always write a PS. Always make that the most important point.

TSP Neil | Social Impact Investing

Social Impact Investing: Outside of the United States or the developed world, there is no such thing as access to credit. Either you have the cash or you do not.

 

There are many of these little psychological games that at the end of the day, the way to tell that effective story is to employ some of those techniques. There are some great books that were written amongst others, but the bottom line is if you can get someone to lean in and do that verbal judo, you’re already 80% of the battle there. If you’ve been short and sweet enough that you’ve been able to get those 3 or 4 mission-critical points across, the reality is human beings can’t store that much information in their head. You’re going to have such a higher chance of success than if you try to talk for 45 minutes. There are still questions at the end and now you’re trying to riff and come up with answers.

At the end of the day, don’t make the perfect the enemy of the good and allow that person to lean in effectively. Intrigue is one of my favorite words. I run a private membership organization that relays and proved out over the years this concept. I essentially sometimes will rarely send it to someone I know but oftentimes cold emails to prominent figures. The number one word I get back in the invitation I send is, “This is so intriguing.” It’s my absolute favorite word. Human beings love to have that interest piqued. Do that as much as you can. There are a lot of techniques within all things that you do that can lead to some material positive results.

I’ve created this whole ladder. That’s why I was resonating with who you are and what you do about going from invisible, to insignificant, to interesting, to intriguing, and at the top becoming irresistible. That whole “Where you are on that ladder,” whether people see you, is the whole key to pulling people in.

You’ve leveled one of the things that I wanted to speak on for a moment, which is talking about analogizing it to dating. Let me be somewhat crass. Human beings are driven. The things that cause joy and fear are universally the same. It doesn’t matter whether you’re marketing on Twitter, Facebook or you’re writing in Sanskrit 10,000 years ago. The idea of stories and the way we communicate and the things that cause us joy are universally similar. What is one of the things that truly drive our lives? Where do you got it a lot wrong but you got one thing right? I hate to say it but sex and relationships drive us at a material level.

As you’re thinking through business, use the relationship analogy in all aspects of your business to understand how do you make yourself irresistible to somebody. Begging usually doesn’t work. Talking one-sidedly usually doesn’t work. How can you get that person to lean in and say, “I absolutely must learn more about this person?” Sometimes a little air of mystery and sometimes going 80% of the way to the kiss, and letting them come in the other 20% that works. The psychology of successful relationships cross-applies in business.

It’s so true that magnetic field of energy. When you think of energy in terms of what energy am I putting out? What is that attracting? Who is this for? Who is this not for? The clearer you get both in your dating life and in your business life, I feel is what makes people attract the right one. What kinds of projects in social impact are you looking to be part of? I know you have an AI background. Are you looking for something that has AI with social impact? Is there any magic formula or you know when you hear it?

If you start off with massive goal for yourself, you're less likely to ever even get started. Click To Tweet

Talking about a relationship analogy, one of my biggest turn-offs is when someone walks in and says, “We’ve got AI, insert whatever platform here.” The same way that a lot of people on dating websites or whatever oversell themselves. The picture doesn’t match up with the reality in life. If you come to pitch me as an investor and say, “Artificial intelligence,” the conversation is usually over before it started. Unless you’re coming from MIT or the Jet Propulsion Lab or something, no one has true AI. It’s a branding term. Having worked in that world, primarily what we have now is machine learning. I won’t go off on a long tangent about this, but when it comes to investors, if they’re smart investors and there is stupid money out there, let’s not kid ourselves.

If you’re talking to a savvy investor, don’t give me crappy, schlocky, corporate terms that you think are buzzwords that get my eyes lit up. The reality is what’s called General Artificial Intelligence does not exist. While I’m looking for things that have automation and machine learning that take a complicated or manual repeatable process, that’s great but the reality is that’s most things. That’s most technology now. That’s table stakes. You’re taking a repeatable process that was done manually and techifying it to some extent. I’m probably, by my admission, not smart enough to understand things that are true deep high tech. There’s a whole class of people out there in the life sciences that are looking at things in true deeper robotics and true neural networks. I love that. I love nerding out about that, but I’m not smart enough to be a proper investor in that.

I’m an investor typically working with families or myself in things like media. Sometimes it’s one of the most exciting and entertaining ways to lose $1 but I’m a glutton for punishment. FinTech and financial services, because I can understand that I still think there’s a lot of nuts to crack there. I also had an insurance technology company in the past. I love taking boring industries and making them sexy wherever possible. I’ll give you a couple of examples of things I’ve invested in. The undercurrent on most of those things is they have to have some degree of social impact.

For example, I’m interested in for-profit universal basic income platforms. There are a few things out there looking at that. It’s fascinating to use financial engineering to provide people with what I call a springing UBI. It’s not a government grant but it’s something that we can do to solve some real societal ills. I’m invested in the company now they specifically does merchant side financing for third world countries. Most people you probably don’t realize, outside of the United States or the developed world, there is no such thing as access to credit. Either you have the cash or you do not.

If you’re a lower-middle-class family in South Africa, Kenya, Peru or Mexico, and you want to buy a stove to heat your house and help feed your family, if you want to have whatever unit of a denomination is an XYZ dollars, you cannot get it. What they do is provide a firm style financing for something like that. You can’t go and buy a TV with this merchant style financing. It has to be things that drive you forward socially. I’m passionate about those folks. Similarly speaking, I’m involved with a company called ScholarMe, which came out of Y Combinator. It’s run by a young kid. It’s a great story. I met him at a venture pitch competition that I was judging. He hacked his way out of Baltimore by going to cafes, hacking into Verizon and getting access to their Wi-Fi. It’s a great story at the outset and you tell this kid has it. He’s a total tech nerd.

He probably shouldn’t be the CEO but definitely, he is someone that knows how to techify a company in the right way. The bottom line is what they do is they’ve created a common application for scholarships using natural language processing and some other deep tech stuff. You can write one application that now goes out and pre-fills 3,000 scholarship applications in a matter of an hour. Whereas before, you probably spend 3,000 hours filling out 3,000 applications with still uncertain results. The way they make money is by doing some interesting plays with student loan companies. I’m interested about what they do in helping people get a low cost or gratis education. Those are the things that I look for which is a true provable business model. Yes, good technology. Yes, good team, but something on the back end, going back to my philosophy, removes fear.

TSP Neil | Social Impact Investing

Social Impact Investing: Storytelling is immensely important and it can be completely impactful.

 

In the first example, the company doing merchant side financing is removing that fear of being able to frankly live in those instances and be able to see past 30 or 40. In the instance of ScholarMe, it’s removing that fear of, “How am I going to pay for college? How am I going to be able to afford these things? Can I go to Yale? Do I have to go to a community college or a local state school?” I’m not saying they’re bad schools, but by comparison, Yale gives you a natural leg up in life. Being able to even that playing field through inclusion, equality, and equity is important to me. That’s what I’m looking for and all the typical VC things. It’s a great founding team, know your stuff, know your numbers, you got the right kind of gray hair sitting behind you.

When I first heard the concept that we feel excited or we feel scared, the sensations in our body are similar, which is joy and fear. It’s up to us to reframe fear, “I’m excited now. I’m not scared.” Whether you’re getting out there to give a TEDx Talk or whatever you’re trying something new, that framework is helpful through the lens of, “I’m looking for things that remove fear from everyday life.” What a great tweet that’s going to be.

The joy and fear or whatever you want to slot in there, there’s a lot of interesting studies on the science of emotion. They’re not only are physiologically closely linked, they’re also neurologically closely linked. There are actual tricks in the way that you can combine those feelings and emotions either to replace them or to say, “Put fear or anxiety with a feeling of joy.” All of a sudden, you create an entirely hybrid emotion that can stimulate you to act in many ways. There’s a lot of neurological backing that once you become aware of it, you can also start to retrain yourself, your body, your mind, and the way that you process things.

Humans can’t store too much information in their heads, but they sure love a great story. Click To Tweet

The way that you put it, reimagining fear is something that gives us excitement and something that I look for in an entrepreneur. Someone that’s taking a kernel of fear and has overcome their own lack of privilege or personal shortcomings and has turned that into a hugely motivating factor. That’s the person that’s going to be your next Elon Musk, Steve Jobs, or someone that never stops. There’s a relentlessness to them sometimes to the detriment of their personal life. It’s a great way to think about it. Emotions play a lot in outcomes and success.

When I teach salespeople that storytelling is a skill as a speaker or through my online course, I tell them, “You must create a story that people see themselves in that story. When they see themselves in the story and they know you have empathy and understanding of the problem that you’re solving, then they want to go on that journey with you.”

That’s right. You have to match those communication styles. If they are an entertainer and want to tell the story of their life, you match it right back and become a great active listener and provide a little bit of a reflection of that storytelling. I’ve gone through and done a lot of sales training myself in the past. Doing that almost Socratic method, I tend to find that often when you ask someone to do something, they’ll give you the opposite answer. If I sat down and started to say to you, “Tell me what you like about your current software platform.” You’re not going to tell me what you think about your software platform. You’re going to go on a tangent on all the things you don’t like about it.

Heuristically, from a sales perspective, I believe that we define our lives by the negatives. I want to go back to my relationship analogy here. If I said, “Describe your perfect mate,” most people would give something like, tall, dark and handsome for a guy or whatever it is. The reality is that’s not who you’re with right now. When I asked you, “Don’t tell me what you think you want. Tell me what you don’t want based on past experience,” you get a much more specific granular laundry list of things that didn’t work. By definition, the opposite is probably true. People oftentimes fool themselves into this vague sense of what the future might hold when the reality is they already hold the keys to those answers by doing that definition by the negatives.

TSP Neil | Social Impact Investing

Social Impact Investing: The things that cause joy and fear are almost universally the same, whether you’re marketing on Twitter or Facebook or you’re writing in Sanskrit 10,000 years ago.

 

Neil, how can people follow you and find out more about you, whether it’s some of the charities you’re involved with? What’s the best way? Is it on your website or LinkedIn? Where should they go?

You’re welcome to go to my website, NeilStClair.com but it’s probably not the best repository for information. I love being contacted directly. I’m open to being an advisor or considering an investment or helping you as I can. As my old boss would say, “Sharing my confusion where appropriate.” Please feel free to reach out directly. My best email is Neil@NeilStClair.com. I’m perfectly accessible through that. In terms of social media platforms, please feel free to reach out to me on LinkedIn. I love connecting with people there. I’m not particularly active on other social media platforms. Although if you want to follow my daughter, she has 1,000 followers on Instagram @EllaBearStClair. I tweet to both her and her brother. They appear on a regular basis. They get political sometimes, but it’s a lot of fun. I figured one day, I was like, “Where am I going to have a catalog of their life?” I go out and take a fifteen-minute coffee break every day. I might as well do something that gives my kids a legacy of their life. Feel free to follow them as well.

What a wonderful and upbeat note to end on. Thanks again for being with us, Neil, and sharing your wisdom of when we do well, we can also do good.

Thank you so much, John. It’s my pleasure.

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John Livesay, The Pitch Whisperer

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Tags: Child Sexual Abuse Prevention, Effective Storytelling, Intrigue Marketing Philosophy, Relationship Analogy, Removing Fear, Social Impact Investing

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