Elaine Longer is the Founder and Portfolio Manager of Longer Financial. She received her MBA from the Walton College and the CFA designation shortly after. Elaine served as the President for Longer Investments Inc which later became Longer Financial, an affiliate of Prime Capital Investment Advisors.
Episode Transcript
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00:06 Matt Waller: Hi, I'm Matt Waller, dean of the Sam M. Walton College of Business. Welcome to Be EPIC, the podcast where we explore excellence, professionalism, innovation and collegiality; and what those values mean in business education in your life today.
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00:28 Matt Waller: I have with me today Elaine Longer, who is an alumna of the Walton College's MBA program before it was called the Walton College. And she also has a CFA. Back in 1986, she founded Longer Investments, Inc. In Fayetteville, Arkansas, and it was merged with Prime Capital Investment Advisors several months ago, and is now called Longer Financial. Thank you for joining me today, Elaine.
00:53 Elaine Longer: Thank you. It's great to be here.
00:56 Matt Waller: Elaine, today, as you know, the Walton College values are represented by EPIC: Excellence, Professionalism, Innovation and Collegiality. And when I think of you, two things that really stand out to me are excellence and professionalism. So Elaine, you got a CFA designation, which is a very significant achievement, not long after getting your MBA. And then, you founded your investment company. And back then, there were very few people who received that designation that were women. I think it's still not very common. So what was it like getting into the financial industry at a time when women weren't really very involved in it?
01:44 Elaine Longer: Well, this comes to the question of some of the values of my MBA program, and one of the most important, it wasn't just the education in the classroom, but my mentors, Dr. Kennedy and Dr. Harold Dulan, were both CFAs. And so I think at that point, there may have been four or five CFAs in the entire state of Arkansas, and two of them were here at the Walton College. Both of them were just so sharing of their knowledge. They continued to mentor me after I left the MBA program and launched into the business world. So, I knew I wanted to do the path of the CFA. And thankfully, my first employer, when I left the university, I went to work at First National Bank, and they had never hired anyone that wanted to do the CFA program, but they were completely supportive of it.
02:40 Matt Waller: Well, that's great. Well, would you tell me a little bit about your career and your decision to start your own company, and so forth?
02:47 Elaine Longer: Well, that's really an interesting question because when I went to work for John Lewis' bank, First National Bank, that was a generationally-owned family bank. And he was in the process of selling the bank to Joe Giroir, of the Rose Law Firm in Little Rock. And Joe Giroir was putting together a four-bank holding company of which First National Bank would be the Anchor Bank. And so when I came in to interview straight out of the MBA program, I was actually hired as Trust Investment Officer, which I look back on that, I still have to pinch myself; to come straight out of a graduate degree and go into actually being responsible for trust investments.
03:36 Elaine Longer: Then once Joe Giroir finished putting together the four-bank holding company, he sold that to Worthen, a banking company in Little Rock, and they ended up in a bad repo deal. Apparently, they had to come up with a large amount of money over the weekend or they would face a problem with the comptroller, the currency on Monday. And they sold the bank back out to J. B. Hunt, who owned J. B. Hunt Transportation. So J. B. Hunt actually owned the bank for a while, while I was Trust Investment Officer. He was just an incredible person to work for, and just so supporter. If you had an idea and you wanted to run with the ball, if you could figure out how to get regulatory approval for it, you could do it. That's just the kind of person he was. But then eventually, he sold the bank back to Worthen.
04:34 Elaine Longer: Now, all of this happened in about three years that I was there. And so I left in 1986 only because I could see the handwriting on the wall. I needed to leave while the decision was still mine. And so I left and I had no idea what I was gonna do. I ended up with a consulting contract with McIlroy Bank, to advise on the bank bond portfolio. And several of the members of the board of directors of First National Bank would call me and encourage me to start my own business. I hadn't really thought of that, but after I heard it the fourth or fifth time, I started to think, "Well, maybe I'll start my own business." [chuckle]
05:18 Elaine Longer: And then I got a call from the gentleman who owned the A. G. Edwards brokerage firm, in Fayetteville, Don Trumbo. And I would run the trades from the trust department through his brokerage firm, so that's how he knew me. And he called along to know if I was gonna start my own business. I said, "Well, I don't know. I've given it some thought." And he said, "Well, there's some empty office space above us, and I'll just run a pipe up and put a quote machine on your desk if that would help." Well, back then in '86, there was no Internet, and to put a quote machine on your desk, it required dedicated phone lines and a small room of servers. I could never put a quote machine on my desk. And so that's how I launched into the business. It was with a lot of help, and a lot of people believed in me more than I did it at times. So that's how it happened.
06:17 Matt Waller: That is so impressive.
06:19 Elaine Longer: It's amazing. [chuckle] When I tell this story, I just don't can't even believe I lived it.
06:25 Matt Waller: So well, your story, again, reminds me of the importance of a community being involved.
06:33 Elaine Longer: Yes, yes.
06:35 Matt Waller: And we always talk about the entrepreneur, but it's the entrepreneur in the context of the community that makes it work.
06:44 Elaine Longer: Yeah, yeah.
06:44 Matt Waller: And so, you've gotta have the right culture to make it work. And clearly, you were willing to take the risk, which was important, but you were also well-qualified because you had an MBA, you had a CFA, you had experience.
06:58 Elaine Longer: Yeah. Well, and I was coached into it. I didn't leave First National Bank and know that I was gonna set up my own business. I left because I knew I needed to leave. And I ended up, when I first left the bank, I was talking to people I knew, directors that I had worked with because they knew me through my trust department work. But also, I talked to Mr. McIlroy and I talked to others that I knew through the Chamber of Commerce. And Hayden McIlroy offered to hire me. And after I had visited with others and had this idea of starting my own firm, I went back to Hayden McIlroy and told him that I was thinking of starting my own firm, and he could hire me a lot cheaper than if they hired me as an employee. And so he did. And so, I started with a $20,000 consulting contract with Hayden McIlroy. So that's how it launched. And then I did by the typewriter, and get an office set up above Don Trumbo, and I got a quote machine on my desk. So it takes a community but thankfully, I had one.
08:09 Matt Waller: So what are some things that stand out to you in terms of your experience in the MBA program?
08:16 Elaine Longer: One of the things that I valued so much about it, it wasn't just book learning. We had experience with people who are out there doing business. And Dr. Kennedy, who was the professor in charge of the investment class that I was in, he was a consultant for Baldor Electric in Fort Smith. And the head of Baldor Electric at the time was Mr. Boreham, and he came up and spoke to our class. And they were traded on the New York Stock Exchange. And back then, the people who handled the trading of an individual stock were called specialists. And the specialist was in town one time, and we had the specialist come in and speak to the class. We were getting real-world experience in Fayetteville, Arkansas through the business school and the connections that the professors had with other people who were out there in the business world. And then one time in our portfolio management class, we were thinking about, "Should we buy Walmart?" And this was back in '82, '83, and Dr. Kennedy arranged for us to meet with Sam Walton. And our class of eight or nine students went up to Walmart and met with Sam Walton for about an hour-and-a-half.
09:40 Matt Waller: Wow!
09:41 Elaine Longer: And it was amazing to visit with him. And at that time, he told our class, "We're not in the retail business. We're in the transportation business." And he talked about the fact that you will never face a stockout in Walmart. I didn't know what a stockout was, except I had a school-aged child, and I know that I would clip the coupons for the pre-school sales and I'd go to Kmart and they're out. Well, that's a stockout. And what Mr. Walton was saying is, "You'll never face that in Walmart." And that year, in fact, in 1983, at their annual meeting, which was always like an evangelical event.
10:22 Matt Waller: Still.
10:22 Elaine Longer: It still is. He had Elizabeth Dole speak at the Walmart shareholder meeting, and at the time, she was Secretary of Transportation. But we had that real-world experience as part of our education. It wasn't just books.
10:39 Matt Waller: Elaine, you've hired many of our students over the years, and students from other universities. What are some things you could share with them that might really benefit them in their career?
10:50 Elaine Longer: Because of the fact that we get to pick from the cream of the crop for our student interns, and they all come in with amazing skills, as far as academic skills are concerned. And we've really have had so much fun with our interns, which we're now on number 55 and 56.
11:08 Matt Waller: Oh, wow!
11:09 Elaine Longer: I have a long history with the internship program; it's been a real blessing to us, just to have that access and to have that knowledge coming in to the business every day. And I would say that one of the things that I would like to see, maybe in the Walton College, would be something that would prepare them or coach them to go into the business world with the ability to conduct a meeting, to be able to sit down with a client across the table, and be able to have the conversation, and to communicate effectively, and to know how to conduct that. When you launch into the business world, you make your A based on relationships. And relationships are formed in meetings, whether it's a board meeting, or a client meeting, or an executive meeting, an employee meeting. I think that's a real important part of success, besides the book smart, is you have to be able to communicate it effectively. And whether you're selling something, or whether you're asking someone across the table to trust you with their money, the trust that's established in the meeting is not what grade you got; it's your communication skills and how you can conduct that meeting.
12:35 Matt Waller: So for you, having started your own firm, you had to be very good at it.
12:42 Elaine Longer: Yes. [chuckle]
12:43 Matt Waller: It's probably one of the reasons why these people thought you should start your own firm. How did you learn those skills?
12:50 Elaine Longer: Well, my dad was military, he was a World War II veteran, and we just were taught you don't interrupt. You have eyeball-to-eyeball contact. We were taught how to shake hands early. Just all of these things that we grew up knowing. But we also, over the years, we would hire someone to come in and help teach new employees. We've learned it as a team where we'd have this consultant come in and talk about, for instance, you should envision your face in a square. And the frame of the square is above your head, down to your shoulders, and across your neck. Into that square comes nothing when you are talking to someone across the table from you. That is an area that is protected from any interruption. No hand goes up to scratch or pull your ear. That is your presentation face. And it shouldn't be... There should be no distractions.
13:54 Elaine Longer: And just things like that, I wouldn't have thought of that. But we had that consultant that helped us to incorporate that into our client meetings. And it's just very helpful to have that skill because when you're in meetings, I like to say 30 minutes after we finish a client meeting, they probably won't be able to recite all the numbers that we gave them, but they will leave with a feeling of whether or not you should be trusted to do what you do for them. And that's what you want them to leave with. It's not just all about numbers.
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14:32 Matt Waller: Thanks for listening to today's episode of the Be EPIC podcast from the Walton College. You can find us on Google, SoundCloud, iTunes, or look for us wherever you find your podcast. Be sure to subscribe and rate us. You can find current and past episodes by searching beepicpodcast, one word, that's B-E-E-P-I-C podcast. And now, be EPIC!
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