The Financial Literacy Gender Gap & Deeper Dive on Ellevest.

The financial industry wasn’t built for women, but Ellevest was. Here’s a look at Ellevest’s disruptive technology through Porter’s 5 Forces.

Katherine Lordi
7 min readOct 26, 2021


Intro — Financial Literacy, Men, Women & Building Confidence

Ever question your skills and abilities or if you’re good enough at something? *Raises hand*. It’s normal to feel this way, and often, these feelings arise due to a lack of confidence in ourselves. Therefore, practice makes perfect! Thinking about confidence in the realm of financial literacy:

‘Women have lower financial literacy than men, but they know more than they think they know.’ (Financial Fragility During the Covid-19 Pandemic)

A couple of weeks ago, I hit you with some stats related to financial literacy as a whole. Now, here is one related to the male-female financial literacy gap reported by MarketWatch according to a financal literacy survey conducted during the pandemic in 2020. This research reveals that there is a link between financial literacy and financial resilience to make important life decisions and achieve various life goals such as saving for education and retirement, raising a family, and running a business.


The research suggests that 1/3 of the financial literacy gender gap can be explained by lower confidence levels among women. For example, when asked about if they know the concept of risk diversification, 55% of women indicated that they do not know compared to 30% of men, revealing a 25% gap. However, when asked an actual question about risk diversification, some 82% of men answered correctly compared to some 73% of women, which is only a 9% gap. From the study, researchers also said that the remaining two-thirds of the financial literacy gap is explained by lower financial knowledge. Therefore, researchers concluded that enhancing the confidence of women when it comes to their financial knowledge in addition to the knowledge itself is essential to more effectively close the financial literacy gender gap.

Now that is where Ellevest comes in!

Ellevest adjusted the financial services industry to women and empowering them in their finances and lives.

Ellevest’s instagram posts empower women and highlight personal finance concepts such as dollar cost averaging, financial self care, budgeting, building a healthy money mindset, and other #relatable posts. Learn more about Ellevest at

Meet Ellevest, a financial services company, fintech investment platform and industry disruptor “built by women, for women.” It brings investing, banking, financial planning, personalized digital investing, and career coaching together under unique membership plans. Its mission? Close the money gender gap by truly meeting the needs of women, and to get more women involved with investing their money and wealth. However, despite this, Ellevest welcomes men! They use gender-specific data to inform investing recommendations.

Founded by Sallie Krawcheck and Charlie Kroll in 2014 under the scrutiny from many skeptics, Ellevest now manages over $1 billion with over 120,000 users, about 90% of whom identify as women (wikipedia). Additionally, though the typical user is a woman in her 30s, Ellevest’s investors range from 18 to 106 years old.

Though I am not personally an Ellevest member, I have heard great things about them from friends who used Ellevest to get into investing and learn about how to use it to meet their financial goals right where they are in life! I have also followed Ellevest on Instagram for a while now, and I applaud them for their branding and social media strategy that connects personal growth to money moves and empowers women to learn, save, and invest. From following Ellevest, I feel as though the company genuinely care about their users and daily needs and financial health. Here are some of the resources that Ellevest offers: Ellevest Magazine | Ellevest Memberships | Ellevest At Work | Ellevest Private Wealth Management.

Ellevest & Threat of Substitutes.

I decided to take a deeper dive on Ellevest through the lens of the impact they are having on the financial services industry and financial literacy through Porter’s 5 Forces, which helps us understand a company’s environment, strengths, and weaknesses. I learned about this framework in depth through The Foundations of Business Strategy course at the University of Virginia.

Image from Management Weekly.

Threat of Substitutes, the last of Porter’s 5 Forces, refers to the threat posed by “substitute goods or services that can be used in place of a company’s products or services” (Investopedia). As an investment advisor/roboadvisor, Ellevest enters a crowded arena with many potential substitutes. However, Ellevest identified a massive niche market that has been historically underserved in the financial services industry and NEEDS attention — Women (not just attention, the right attention!). Ellevest even made CNBC’s 2018 and 2019 List of 50 Disruptors because of this at number 24 and 45, respectively.

Ellevest is currently the only robo-advisor out there for women still standing after WorthFM, another company focused on women, launched around the same time but closed in 2018. WorthFM cited poor marketing efforts and its narrow focus on high network women as reasons why they failed. Ellevest on the other hand began with women of moderate wealth and effectively growing funding and investors before turning to high wealth women with the launch of Ellevest Private Wealth Management.

Image from Ellevest’s twitter

Because of how well Ellevest has done killing the social media game, appearling to millenial women well, and focusing on real women’s needs when it comes to finances and learning, the threat of a substitute company that will do and can do what Ellevest does is low. However, of course with the rise of new and emerging technologies and cryptocurrencies, which are a hard no in an Ellevest portfolio, Ellevest will need to keep innovating and thinking about their stance in order to keep up with other companies and maintain their competitive advantage in a tech-driven world.

More on Ellevest’s Core Competitve Advantage and Disruptive Factors.

Ellevest’s core competitive advantage comes from them truly meeting real women’s needs in many spaces and synthesizing them well in one platform — financial literacy, investing, career growth — and doing so well in the way they design aspects of their products and services ranging from the UI to their investment strategy. They do it via The Ellevest Difference and Methodology and focus on the following:

  • Learning and resources to help with financial learning and literacy.
  • Carefully rethinking each step of goals-based investment from the bottom-up, considering their construction of their portfolios, selection of investments within them, and development of algorithms to drive forecasts and recommendations. For example, unlike many competitors, Ellevest uses up to 21 different asset classes across the goal-based portfolios.
  • Careful consideration of women’s different approaches to investing than men and the use of gender-specific data to inform investing recommendations. For example, women are often more goal-oriented when it comes to investment decisions, risk aware and prefer less volatility than men. Additionally, on average, women tend to live longer than men, take more time off from work to care for children, and have different salary arcs.
  • A modern, easy-to-use, and engaging user experience (UI/UX).
  • Creating a bold social media presence that appeals to real women investors and those getting into investing and financial literacy.

Ellevest has a sauce, but it isn’t secret! If a company has the desire to, they could imitate them. However, since Ellevest does what they do and serve women so well compared to other companies that have tried and failed, it wouldn’t be wise for another player to imitate and do the same thing. Additionally, the common consensus may be that “women don’t need personal finance services just for them” and “don’t need all the pink washing and paternalistic sales pitches” (Forbes). However, Ellevest’s main colors in their style guide does not include pink!

“Son of a gun, the industry today has built a pink wall that I don’t think they meant to build, but that has kept women out.” ~ Ellevest CEO Sallie Krawcheck

Reflection & What’s Next?

Thank you for reading! In my last post, I wrote a meaningful high-level on financial literacy and the role of news, media, for-profits, and non-profit companies. In this one, I explored the financial literacy gender gap and dove deeper into the disruptive key player serving women’s needs, Ellevest, through the lens of their core competencies and Porter’s 5 Forces. I loved analyzing Ellevest, and I look forward to possibly writing about other audiences and communities to serve and target to improve financial literacy, inclusion, and accessibility in the United States and globally.

For me, it’s buying fresh flowers for the kitchen and Jackass Burrito every other week.



Katherine Lordi

20-something Associate Product Manager from Philly @ WSJ, Barron’s. Writing about what I’m learning! •Tech, Media, Personal Finance, Self Development, Health •