Thirty Minute Mentors Podcast Transcript: PEAK6 Co-Founder Jenny Just

I recently interviewed PEAK6 Co-Founder Jenny Just on my podcast, Thirty Minute Mentors. Here is a transcript of our interview:

Adam: Our guest today is a member of a highly select group of women who are self-made billionaires. Jenny Just is the co-founder and managing director of PEAK6, a multibillion-dollar financial services and technology company. Jenny, thank you for joining us.

Jenny: Thank you. I'm so excited to be here.

Adam: Excited to have you on. You grew up in Wisconsin and did your undergrad at the University of Michigan before moving to Chicago to take an entry-level job at a financial services firm. Can you take listeners back to your early days, what early experiences and lessons shaped your worldview and shaped the trajectory of your success?

Jenny: Sure, I'd be happy to do that. I started my career out of undergrad on the Chicago Board Options Exchange trading floor with a company called O'Connor and Associates who are infamous in the options world. And I have to say, I had no idea what I was going to do. I had no idea what options trading was. And I ended up taking that job because it was very early days and dressing casual kind of world. They also served food. Google didn't exist back then. So Haagen Dazs and beer in the fridge was really enticing to my 21-year-old self. And my very first day on the exchange Drexel Burnham declared bankruptcy and the market went bananas. So, I was taken down there and I did not know what I was gonna experience. And for those of you who haven't seen Trading Places are one of the infamous Wall Street movies. It's like game day every day, screaming and yelling, lots of large men, and very few people who look like myself down there. So, it's highly entertaining. But also, it's like a foreign world. And I was super lucky to learn it. That's what I have to say. It's a language not a lot of people learn. Even in the financial industry, going all the way to the far right of that curve is our learning options. And they're like puzzle pieces. So they not only help you think about the financial products, so I happen to do options on stocks. But they help you to think about all the different places of a business, which I didn't know at the time, I was just learning options trading. But eventually, when I left O'Connor, they had done a deal with Swiss Bank and eventually became UBS. And we were going off on our own. But how you put pieces of your risk profile together is something we learned quite literally on the trading floor, but then used quite figuratively in other ways when we started to build a business. So I'm very fortunate to have learned what I learned. The other big thing you learn when you learn trading is you learn how to make quick decisions. And clearly, you don't have all the information and the opportunity to do that over and over and fail the majority of the time. So when you look at the portfolio of options that we have, it's an original business we started 26 years ago, called PEAK6 Capital Management, and it's never had a losing year to this day. And that's the thing that's funded all the other businesses we've done, but we lose 46% of our trades. So some high number, hopefully not over 50%. But you get really used to taking risks. And I think it was super opportunistic that I was able to do that at such a young age.

Adam: Can you dive a little bit deeper into your approach to decision-making and your approach to taking and managing risk?

Jenny: Sure. I generally thought I was a pretty good decision-maker. Not until you're forced to make them by yourself, one on one with the market do you realize you're not as good as you think. And it's one of the reasons why for people who are not interested necessarily, first of all, they're not in the industry, so they're not trading. But you have to manage your money. And many people will say, "I'll use an advisor." But even if you use an advisor, trading stocks for yourself, you learn so much. You don't have to trade very much, we have fractional shares today. One of our businesses was the first one to bring that to market, Apex FinTech Solutions. But you've learned so much by doing that transaction. And so the interesting thing many years later, though, what I would say about me learning, and thinking I was a good decision maker, and then of course, practicing it over and over again. In the trading world, there are a lot of people in our world that play poker. And I never did. I was the opposite of that. And it turns out that poker is an incredible way to think about making decisions with incomplete information. And so I learned later in life, and I say to this day, if I had learned poker much earlier, I would have taken 10 years out of my failures, because it gives such a framework for thinking about how to make a decision, because there are so many things that are happening at a poker table. And some people have more or less chips than you, there are more or less powerful positions than you. You have two cards that you're dealt but ends up not being about the cards. It's how you play against the people you're sitting with. So my partners and I today, now that I've learned this game of poker, and I don't have to play for money to get all the skills, let's be clear, is we use poker as a framework very simply. What cards do you think they have? Are we in a deal or a negotiation? What cards do I think they have? And we're going to think different things. But now the question is why? What are you seeing that I'm not seeing? And what can I learn from what you're seeing? And then we can go through the whole play. What do you think has come out on the table already? Five cards come out and poker in a community game. And where do you think we are, and how much is in the pot, and how much they bet? You can use poker as a framework for decision-making. And if you've never done it before, and you're a poker player and trying to do it, your colleagues who haven't played, it's an amazing mentor-mentee opportunity to get inside their head on how they're approaching a decision. So that's been for sure, the most recent, what's called the last four years, way, I've been trying to approach creating a systematic way to make decisions. A decision is a risk by definition. It could be a small risk, or it can be a large risk, but it is a risk. And if you're not comfortable doing that, the most important thing you can do is practice doing it more, don't avoid it. Because those decisions start to compound on each other. You start to learn so much from each decision that you make, and each fail, of course, or success that you have along the way. So we created Poker Power Play, which is a poker app. In my opinion, the only gender-neutral poker app that's out there. And each hand is an opportunity to make a decision. But each game, of course, is an opportunity to think about decisions in a larger way, strategy versus tactics. And we've had a lot of fun, trying to take something that feels subjective and make it more objective.

Adam: Get comfortable being uncomfortable. How did PEAK6 come together? And how were you able to turn it into a multibillion-dollar business?

Jenny: That's exactly right. It's not an option, whether something's going to be uncomfortable in the future. You know it's going to be, you may as well prep yourself and give yourself the best opportunity. I always talk about a journey. What relationship, whether it's your relationship with your work with a spouse or a partner, or your relationship with money, none of them are smooth? None of them. There are always going to be ups and downs. Now, what are you going to do as a result of when those ups and downs come? Well, if I can be a better decision-maker, it's one of the reasons why it's incredibly important for women to start to play poker. It's why we're on a mission to teach a million women a game. Because poker is a male-dominated game. 93% or more than 100 million people in the world have played poker, we think the number is much bigger. Nobody knows a number, or men, they get this practice of making those small decisions at a young age, often, often often. And it's not part of our play, or our habits or things that those who identify as women typically are doing. So if you're a dad, and you have a daughter, your daughter should be playing as well as your son should be playing. Because the more I get to practice doing it, there's something I talk about the compound experience. So like compound interest, we know there's an exponential curve. If I reinvest my interest, once I get my principal, I get my interest. Then my interest gets interest and interest. Same thing with those early experiences. The more I get a chance to make those decisions, the more they capitalize on themselves. I learned more earlier. So I have greater learnings to apply later. They compound on themselves. It's part of certainly why I have been able to accomplish what I have been able to accomplish. Because I took a lot of risk early on. I didn't know I was doing it. I always laugh and I say, I didn't know I could say no. So I kept saying yes. I wasn't brilliant at it. I just got a lot of practice.

Adam: How did PEAK6 come together? And how were you able to turn it into a multibillion-dollar business?

Jenny: PEAK6 came together, not because we were necessarily in 26 years ago, the entrepreneurship that we talked about today, and all the angel and VC stuff that happens today. And so many people are involved. It certainly wasn't in my vernacular, it wasn't in my world, and the internet's just basically getting running. And our company O'Connor, then Swiss bank, UBS was moving. We were fortunate enough to help start a department, my co-founder, myself, we're fortunate enough to start a department at the bank, in the over-the-counter equity derivative world. So this is not an exchange-traded product. So I had this experience young. It was just me and him. And there was a gentleman who was brought in from Goldman, because O'Connor, at the time didn't do that business. It was the banks who did that business. We brought in a gentleman and it was just us in a room trying to figure out how to sell derivatives to companies, to institutions. And so we had that experience under a belt. And when the bank decided to move and located out in Stanford, we said, well, for personal reasons, we're staying behind. And we said, well, we'll just do that again. I mean, we're naive, honestly. And the interesting thing is our original plan, we've never done. So that was what we call Plan A, we are going to redo that, go out to the Corpus. Because it's just a couple of us in a room doing it the last time. Why can't we just do that again? Well, you need a credit rating to do that. And, with two people in a room and $1.6 million, that's not getting you anywhere. So we tried to partner with banks to do what we were doing. And we got to the 11th hour interestingly, with Jamie Dimon who was at First Chicago, and this is about a year and a change into having started the firm. And we just couldn't get a deal done. Kept delaying, delaying, delaying. Not Jamie's issue, I'm sure, but generally the bank to get things done. And we looked at each other, we said, this may never happen. And now what? The fact that we looked at ourselves in the mirror and said, let's be real. We're not making money. I was a single mom at the time. And I was like, we had worked six, seven years at our previous firm and made okay money for our age, but we got to make some money. So we looked at each other. And fortuitously, we had met a gentleman. And so we started doing some work. We said we needed to start trading, which we had already started. But we need to ramp into this trading. And we met someone who said, "You can use technology." And we said, "No, we don't know about technology." My co-founder was an English major, I was a business major at Michigan. So we started, I put our first server together, and we got our hands dirty. And we started to imagine a world where you had to be on the exchange floor, we were the first off-floor equity trading firms ever as far as we know. And we started the experiment. So we had interns and we said, "Well, we're going to have some of you go to the trading floor and some of you will not go to the trading floor. And let's see what happens. Because we thought the trading floor was the place to be. So we're open-minded to something that didn't exist and doing it differently, mostly because we knew we couldn't populate the exchange floors. Like we're just a couple of kids in a room. Like what do we know about managing people who are sitting in California or New York? So if we don't want to do that, what is another option? What people should take from that is, what do you want to do? And I knew I didn't want to manage a lot of people. Ironically, today, having a couple of 1000 people and having gone up and down as buying and selling firms, my goal was not to have more than 10 people work for us because I didn't think we knew better. So we did what we needed to do for us to be our best selves. And that started the journey. Things changed the technology, and the idea worked. And that's the business that now has been able to fund us for all our different opportunities over the years.

Adam: It's a great lesson and there are a lot of great lessons in there. Failure can breed success. Your initial business model didn't work. You found a better business model. You found a business model that took you to where you are today. How did that happen? You were open-minded. You were flexible. You are adaptable, you are willing to get your hands dirty, you aren't afraid to try new things, and you aren't afraid to experiment. That's how you did it.

Jenny: Yeah. And it's funny over the years because we had the freedom to take risks, and people don't think they own the freedom when they work for somebody else. But you own your freedom to take risks. And the firm I worked at was like that O'Connor was like that. I'm forever grateful to the O'Connor partners. Because I had that freedom all along. It's just whether I use it or not. And in the case where things are up against the wall, and I'm looking, the other thing, of course, they taught us is the highs and lows, what we call the fat tails, and things can get bad. So being realistic, but knowing that I have the power to do something about it, you have more power than you think.

Adam: That's a great lesson, you have the freedom to take risks. At the end of the day, we control our destinies to a degree much greater than any of us realize. All too often, we get trapped in the moment. And we get trapped in the pressures and responsibilities of our day-to-day lives or day-to-day jobs or day-to-day responsibilities. But if you take a step back, your point is right on the money. It's your life, get in the driver's seat, you only have one life, it's yours. Take control. That That's right. How do you assess the companies that you invest in? And what are your best tips on the topic of investing?

Jenny: What's particularly interesting having done it over a long period and having a lot of fails, and then having a handful of really big successes and looking back and saying what do I regret or what am I proud of, people probably looked at me, they'd say I'd taken a lot of risk. And I probably would say I didn't take enough risk. And also the one other unique piece to who we are as a firm is that we're trading, we're in the market all the time. Most people are in their businesses unless there are financial businesses, a lot of them are in their retail market, whatever it is. But when you pay attention to the market which has been this glorious market for so many years until April 22, you have to know what the market and therefore ultimately the customer cares about. Where's the real demand today and into the next 5 to 10 years? You're thinking that AI would be the obvious one at the top of the list. If that's the case, then you're also looking at what are investors rewarding. Are they rewarding how many eyeballs you can get? Are they rewarding the bottom line? Those things make a difference in how you approach your business plan. Despite us being in the markets, we were naive in many ways, which is why I would say today, I probably would have taken a risk differently if I could go back and do it again. Where's the most bang for your buck? Whereas for all my time and effort, where is the upside? And being cognizant because there are two things I think that you toil with, especially as an entrepreneur, but what do you care passionately about? If you care about both those things together, or if you don't? Because if you do, you have to think about what the market is rewarding in that scope of time. We might talk about three to five years in from a trading world perspective, but it's more of a decade. What are we looking at in a 7 to 10-year timeframe? Where do we think the customer is gonna be? What are they going to care about? Where are investors looking to invest? And staying attuned to that really will help you make top-down decisions a little bit better. This is why I'd say, the world in the last decade was rewarding every effort under the sun, eyeballs, and making no money, whatever it was, and you can behave differently during those times. And I think coming from the trading world and risk-taking world, we always said we didn't make the most money. We've had a lot of success, but we don't lose money either. It actually could have been an opportunity to lose money which is a funny thing to say, at least to us and historically. But if you think about how many years Amazon did go and not make money, you take some of these bigger lessons that are out there and look at the totality of the market that you're going into. Now, if you're looking at a smaller business and it's a local business, you might wait that less. But if you're trying to build a substantial business, I think it's really important to understand what investors care about. Frankly, PEAK6 has always done this, we're looking for businesses that make money. And we will make bets because if they're strategic to us in some way, or we think we have a unique opportunity, and most of the things we invest, probably half in FinTech, which we have because of APEX FinTech solutions, it's the back end technology for almost 65% of the retail broker-dealers out there. So, we have a lot of knowledge. And so when you have knowledge about the industry, and you have all that data on all the customers, more than 25 million customers there, 100 million on the tax side, that informs the market. Again, it's informing us on that front. And then on the other side of the business where we look at a broader range, I do think we would have done things differently. That was also newish to us in the last 10 years, we didn't do a lot of that. We did a lot of fintech and then we started to spread our wings. But I don't think there's a one-size-fits-all-all. But I do think there's a really important lesson to think about top-down what the market is rewarding.

Adam: What do you look for in the people who you invest in, whether you're investing in their companies, or whether you're entrusting them with responsibility as a member of your team?

Jenny: We've learned a lot over the years over having more than 15 different businesses. And for sure, in our leaders, we're looking for leaders who bring out the best in their best talent. So it's a little bit of a derivative, which is the world I live in. But where the best leader leads their ego, doesn't matter how the team succeeds, as long as they succeed. What happens is, as that organization gets better, there's going to be pockets of talent. And we want all of the best talent to succeed at the highest rate because they're all going to be a reflection of the person who is leading. And all of those people can then follow all of those pieces of best talent. So I've more leaders doing better things one step down from their primary leader. So we think about it more like partners, as opposed to a triangle of CEO on down. The other thing that we look for is those who are willing to be super self-aware is critical. And those who are willing to change, which means taking risks again, of course. But I'll give you an example, we might be in a turnaround situation and have the perfect person to do that. We call them a wartime general. But when things are turning, and getting better, and now we need that peacetime general and we need a growth person, it might not be the same person anymore. And people get locked into titles and it's great when they're taking accountability. But sometimes the accountability is to say, I'm the wrong person for that stage. So now what do I do? I'm gonna lean on my partners, hopefully, I'm gonna lean on somebody else. What does that mean about titles and all these other things? We're super flexible inside of our firm, and we like people who recognize that their best and highest use may not be in that same spot anymore. So we have a lot of fluidity across our firm. So one of the things we're most proud of is the talent that is at PEAK6 but also stays at PEAK6  for so many years. Because they get to grow and develop in different ways. And they get used in the best way possible for their specific skills.

Adam: As you describe what you look for in leaders who you invest in, you mentioned a couple of really important characteristics, universal to the very best leaders. Self-awareness, flexibility, being willing to change. You also mentioned something really important, which doesn't get talked about enough. If the very best leaders understand when to step up and when to step back, you are never going to be the right person for every situation. Just not possible. What is the right situation for you? What is the right company for you to lead? What is the right time for you to lead? Are you the right person? Are you the wrong person? And it does come back to self-awareness. If you understand yourself intimately, understand your strengths, understand your weaknesses, and know thyself, that will guide you. That will allow you to know, should I step up? Should I step back? Your partner at peak six is also your husband. You were colleagues and then co-founders, and business partners before becoming spouses. What have been the keys to maintaining healthy personal relationships and a healthy professional relationship when the two are so deeply intertwined? And what advice do you have for listeners on how to develop and maintain successful relationships and partnerships?

Jenny: Yeah, that's dangerous. We have known each other very long time. And we were many years into PEAK6 before this happened. And nobody would have guessed. Because I always say there's a fine line between love and hate because starting a firm is hard. There's a lot of risk. And there's a lot of highs and lows. So the fact that this became something is funny because you find quite a few husbands and wives that are in it. Keys, one thing we did may or may not be unique, but we have different responsibilities. I always say you can't assume I know something just because I'm married. So initially, he was the outside person, and I was the inside person. He's a top-down person, I’m a bottom-up person, so we can divide and conquer the world. Of course, those things eventually merge and chaos ensues. But I also think especially at the time, we have to think back. This is 26 years ago. The fact that we were equal partners, when we started, is probably kudos to him, he's got a really strong mom and sister. And that's why he was open-minded. I also think, that because we had started that department inside of the bank together, so he knew. But we always said he or she who has the most passion wins, because it was just two votes. Self-awareness is critical because it can go into your personal life. The maturity and growing that maturity over the years takes a lot and then you put kids on top of it. I would not say it's for the faint of heart but extraordinarily rewarding if it works. I mean, it's like a job for us, it is our world. So we're really lucky to share the highs and lows, even though it can be traumatic at times.

Adam: Given your experience cultivating this unique relationship, what advice do you have for listeners on how to develop and maintain successful relationships personally and professionally?

Jenny: I don't know if I'm the best person. But one thing I know that I didn't do in my early years and it's funny because I wouldn't take this back when I say he was the outside person, I was the inside person. I did nothing with the outside world, including networking. And I wouldn't take it back because it allowed me what I needed to do to be the mom I wanted to be. Because there was only so much time in a day. But I do know now since I've been aggressively out there in the last couple of years, how valuable building those relationships is. And so I would figure out how to reprioritize something so I could do that in the future. But you have to be precise because there's just limited time. So how can you do it? And the beauty of the flexible workplace allows for a lot more of that today than before. But I also think you have to be smart. I always say to the women who asked how I was able to do what I did. I say don't lock yourself in any certain way because you don't know what's going to change, particularly with your children. What do you have time for? So if I have time, if I want to do this for the next quarter, this amount of networking doesn't mean I have to do it the next quarter or the next quarter, but I might do it in the fourth quarter. It doesn't mean I have to do it for the whole year. I get to control what I'm going to do and what my priority is and priorities change. People don't change, though. And so what do you need to do to create the best relationships personally and professionally, besides being a good human, that takes effort and time so you can't do everything. But if you can get a two for one, I would take it.

Adam: Jenny, what can anyone listening to this conversation do to become more successful personally and professionally?

Jenny: Everybody has their luck. You can be in the right place at the right time. I think the question is, how do you capitalize on it? And I will tell you, you have to take risks. It's the only way. People think it's like I had to jump out of a plane. Oh, I have to start a company. No, you don't have to. You have to take greater risks, you have to take more ‘risks’ with an S. So, those start to compound and you start to learn what you're good at, what kind of risks you like to take, and you have to start earlier, which is why the beauty of getting poker as an example, you can start teaching poker at 6, 7, 8 years old. When they see it when they're 12, and 14 again, and then when they see it when they're 18 and 20, they have all that under their belt. They're not learning from scratch. Same thing with any kind of risk you're going to take. So when somebody thinks you are the right person for a job, and you're not quite sure of that, don't think about how you feel, think about why they asked you. Why would they ask if they didn't think you were right? If I wait till I'm 97% sure, the person who was good to take a risk who's 60% sure, and typically, in our industry, it tends to be the male, I'm getting behind automatically. He's not any more certain than I am certain. He's just willing to take the risk. So for certain, I said yes without not knowing I could say no. So, I got lucky. But your conscious self, if you're not getting uncomfortable, which is what risk does, everybody wants their curve to go up into the right, personal money, whatever it is. But it's going to have a ceiling. If you don't take risks. The only way it gets higher and steeper is if you take the risk, and it has to go lower to go higher. And over time, those swings start to even out, you get better and better at doing it. But if you don't start and then you wait, you wait till I can't take any risk. Because now I've got three kids in the house and that thing, that's why we have to get our women and those identify as women earlier taking those risks.

Adam: Jenny, thank you for all the great advice and thank you for being a part of Thirty Minute Mentors.

Jenny: My pleasure. Thanks so much for having me.


Adam Mendler is an entrepreneur, writer, speaker, educator, and nationally recognized authority on leadership. Adam is the creator and host of the business and leadership podcast Thirty Minute Mentors, where he goes one on one with America's most successful people - Fortune 500 CEOs, founders of household name companies, Hall of Fame and Olympic gold medal-winning athletes, political and military leaders - for intimate half-hour conversations each week. A top leadership speaker, Adam draws upon his insights building and leading businesses and interviewing hundreds of America's top leaders as a top keynote speaker to businesses, universities, and non-profit organizations. Adam has written extensively on leadership and related topics, having authored over 70 articles published in major media outlets including Forbes, Inc. and HuffPost, and has conducted more than 500 one on one interviews with America’s top leaders through his collective media projects. Adam teaches graduate-level courses on leadership at UCLA and is an advisor to numerous companies and leaders. A Los Angeles native, Adam is a lifelong Angels fan and an avid backgammon player.

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