As Picasso once said, “All children are artists. The problem is how to remain an artist once he or she grows up.”
At Baillie Gifford, we aim to remain open-minded and fight the temptation to anchor and extrapolate from the recent past. If we don’t, we risk underestimating the potential for transformational change. We must constantly challenge our assumptions and beliefs, reconsider prevailing wisdom and keep asking the questions why, why not, and what if?
It’s crucial that we build curiosity and creativity into the investment process, but how do we do that?
Some of the steps we take to encourage curiosity include making educational diversity central to our recruitment, creating an environment where people can experiment, and by building relationships outside of the traditional investment world.
Our investment graduates come from a wide range of disciplines. Although I might be a boring economist, I also work with people who have backgrounds in philosophy, literature, microbiology, anthropology, mathematics and music.
While this certainly helps cognitive diversity, what is most interesting is how different disciplines interact with the financial world. Let’s explore what music and maths could possibly have in common with the world of finance.
Music is emotion expressed in mathematical form and both music and finance sit somewhere between science and art. Like investment, music is also about dynamic pattern recognition. Trained musicians should be logical and creative at the same time and comfortable with ambiguity. These qualities are essential if you are to identify exciting investment opportunities while dealing with uncertainty.
Contrary to popular belief, maths is not really about computation but about proving links between concepts. The best maths consists of understanding a concept in a way nobody else has and finding a way to explain it clearly to others.
This is exactly what we want to do in investment. With the same information as everybody else, what is most valuable to us is nurturing that ability to make creative links between things so that we can see opportunities differently to others.
Hiring people from different disciplines, especially those outside of finance, adds a lot of value to our investment process. It allows for a unique and creative way of thinking rather than just applying the acquired knowledge directly.
Of course, it is not enough just to hire intelligent and creative individuals and then hope that creativity is going to occur spontaneously. Creativity requires risk-taking and being prepared to be wrong from time to time.
We believe that we have the right culture for creativity to thrive. As investors, we have freedom to pursue our interests and we are encouraged to be creative with our research tools and to experiment with different ways of thinking.
For example, last year our graduates had to come up with their own company of the future reflecting some of the technological trends they experienced at an interdisciplinary technology festival.
This tech festival was an opportunity to immerse in the ecosystem of tech and science entrepreneurs. You don’t usually find many investors at this type of event, but this experience helped the grads to start building a picture of the future and to think about competition and business plans.
In the search of new ideas, as investors, we do spend a large proportion of our time outside the office meeting companies, entrepreneurs and academics (albeit virtually for most of this year). This brings me to the final way in which we foster curiosity.
We tend to build relationships with scientists, writers and thought leaders through our broad sponsorship programme. For example, we sponsor large and small book festivals throughout the UK and support leading academics around the world.
Why do we do this? One reason is that it allows us to connect to people who can offer a different view of the world and what could be. We find the academic input to be extremely valuable as it has the ability to free itself from preconceptions, self-interest and challenge well-established assumptions.
When we pair these relationships with an environment where investors can experiment, then the result is a culture of curiosity and creativity. This curiosity is a central building block of our firm and is just one of the many qualities that make up an actual investor.
To discover more about what it means to be an actual investor, please visit our website.