On this week's episode of the Financial Planning Podcast, Amy Kadomatsu talks about the power of not staying in your lane.
Kadomatsu, the CEO of New York-based compliance software firm ComplySci, joins the podcast fresh off being
But she also focuses on the big picture. In this edition, she talks about her path into financial services and overcoming the idea that she — the daughter of a hair stylist and an architectural draftsman — shouldn't be in this industry at all. For Kadomatsu, the path to success began with support of passionate leaders and understanding that there was no right or wrong way to win.
She now works to make sure those in her organization have the same support, and to open the doors of financial services to the next generation of leaders who "aren't supposed to be here."
During her conversation with FP Podcast host and lead editorial producer Justin L. Mack, Kadomatsu talks about the importance of bringing your authentic self with you to work, the pressures chief compliance officers are facing in this fast-moving environment, and the strength that comes with shedding your armor.
Listen to the new episode — as well as all future and past episodes — by subscribing to the FP Podcast on
Transcript:
Justin Mack (
Good morning, good afternoon and good evening. Welcome to the Financial Planning Podcast. I am your host, Justin L. Mack, wealthtech reporter with Financial Planning. And it is my pleasure to introduce this week's guest, Amy Kadomatsu, ComplySci's chief executive officer. Amy, thanks so much for joining us this week.
Amy Kadomatsu (
Thank you so much for having me.
Justin Mack (
Absolutely. Now, Amy joined ComplySci as Chief Operating Officer in 2018, was named president in 2019 and became CEO in 2020. So making big moves back to back to back and putting her at the helm of the company's overall strategic direction and execution of its mission. For those unaware, ComplySci has been serving up compliance software tools for financial services firms since 2003. Previously, Amy was managing director at S&P Global and chief product officer at TheMarkets.com. A serial entrepreneur, Amy was also the co-founder of Instabot, an enterprise chatbot platform for marketers, and the President of ROKO Labs, a product strategy and technology consultancy that works with global companies and VC-backed startups to boost their businesses. She is still a member of the ROKO Labs' board.
But just like her passions for tech and entrepreneurship, Amy is passionate about diversity and inclusion within the industry. And that's how I'd like to kick off this week's episode. With a bit of news and a recent honor from WatersTechnology that Amy has earned for her work in this space just a few months ago. Now Amy, people didn't come here to listen to me talk. They listen to me yammer all the time. Bimonthly on financial-planning.com. So I'll have you kick things off. What are we celebrating with the honor from WatersTechnology?
Amy Kadomatsu (
Well, I was really just honored to be able to receive the recognition. It's a little bit of a long name. The
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And I was really lucky over the course of the many, many years. If we go back into the wayback machine … thinking about even just being able to go to some amazing colleges and business school. Having people recognize the opportunity that I had in front of me and who opened up doors on my behalf, and who recognized that I could participate in a broader organization. In a broader position. All of those things. And so all of these things come to one of the theories that I have, which is that you can't be what you can't see. It is important in all of our communities to be able to highlight and celebrate role models. For you, for me … to be able to go back and to talk to people and just to tell our stories about how we got to where we are. Because I think it is so hard these days for children, especially those in lower-income communities or where there aren't as many role models immediately around them, where they might think to themselves that to be a participant and to be a mover and shaker in technology or in fintech or in regtech, that what they have to be is a coder.
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And that's the only way. They can only be a programmer to be able to participate. And as you and I both know, that's not at all true. And in fact, the opportunity for people to participate, whether it's in marketing, whether it's in legal, whether it's in product, to think about the next version of a product or as a UX designer, etc. So all of these different parts of the organization are available to all of the youth that are in our communities today. And to be able to shine a light on all of those avenues is really, really important to me because I think that they have an ability to then see themselves in those positions as they see us.
Justin Mack (
Definitely, definitely. And two things you said there that really hit home for me, and I'm sure will hit home for a lot of people who will be listening to this … people saying you're not supposed to be here. Look at you. Look at where you come from. Look at who you are. This is the role you should have. And if you're going to get into this space, like you said, the belief that you can only do this. This is your lane. Stay in it. But through the work that you're doing and so many others are doing, it shows that one, there is no lane to stay in. And two, whoever's supposed to be here is the best person for the job. I think you exemplify that. I'd like to get your thoughts on the work you're doing, because now of course the reward. Like we mentioned, a long name, but we're used to long names in this industry <laugh>. So,
Amy Kadomatsu (
I don't know that I can remember exactly. I'm not a very young person any longer. But if I think about one of the places where it really hit home to me was in the work that I had done with a nonprofit that I work with
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Her perspective was, I've looked at the finances and what I can afford, and so I've created a list based on that. And my feedback to her and my thinking to myself was, are you nuts? I was like, this is not the way that we should be thinking about your college education and how you can move forward. What we really need to think about is trying to get you into the best college you can possibly go to, and then let's figure out the finances after. Because what I knew, but what she didn't know, she felt that there was a limit based on the economics she could provide and what she could try to get. Whereas what I knew was that if she could get into an excellent college, then in many ways, whether it was with scholarships or with other programs that are out there, that she could think of being more. Of doing more.
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And she ended up being able to get a full ride scholarship to UVA based on one of the other programs that she had applied to. And it hit home that even if you can influence just one individual, it takes one after another another in order to create a village. It's important to be able to invest in people. And I think trying to do that within the organization today, whether it's being thoughtful about who you hire into organizations. How the process of hiring within an organization (works) and thinking about how we can eliminate the discrimination within the process itself, all of those things are important to ultimately then be able to realize what we know to be true. Which is that there is talent, there is intellectual power within all aspects of the communities that we serve. And it's really easy to just think about educational pedigrees and whether or not you've had other financial services, jobs, etc., as you think about new hires into the organization. But I was just talking on a call the other day with some new hires and I had a teacher who had come on to join our organization. And that's a singular incident. There are actually quite a few teachers who joined our ranks. And these are people who've never been in and around the financial services industry before and they're learning and they are eager to serve our clients and to really move us forward. And I can't be more proud of that.
Justin Mack (
Awesome. And then on that same topic, as far as inspiring that next generation. Letting them know what's available. Letting them know that the limiters are off. There are none except for the ones that we place on ourselves, oftentimes. Talk to me about the importance of diverse leaders within leadership roles. And not only being a leader in that role and being someone who might not look like the norm or the status quo, but being your authentic full self in that role. The reason I ask is that, at least I know I've experienced it a bit professionally and some other folks that I know professionally have experienced it too … (the situation where) you're in a great spot, great organization, but for some reason you feel the need to pull back on all the elements of you. The things that might be part of your culture. Whether it be your music or your taste in movies or fashion or whatever that you might still be hesitant to fully share because of what people might think of that.
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I think that's changed recently. Personally, I think the pandemic,oddly enough, helped in that way because we are connecting with Zoom. So when I hop on a Zoom call, people see my real office and they see all my stuff in the background. I'm a bit of an odd guy. I work in what looks like a makeshift Bat cave with video game stuff and my anime posters and my pro wrestling T-shirts. It's who I am, but that's the authentic me. For you, how important is it that when we get in these spots that we also are true to who we are? What impact does that have on the next generation or that high school kid who might be the next person to hold your spot?
Amy Kadomatsu (
It's so important. I mean, I really can't … you hit it, you hit it <laugh> on the nose in terms of the description. I mean, I think that over time, and I would tell you that I learned this the hard way. Which is that when I first left college and I had my first job and it was in financial services and there was an expectation to conform, and there were certain things that were approved or not approved or who you should talk to or who you should not talk to within an organization. And coming from my own background, it was a bit shocking to be honest with you. And it really drove me to think … I had really thought, oh my God, I've made it. I come into financial services. I'm in this incredible job. And what you realize is that not only are there organizations, but you have to look at the culture within those organizations as well.
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And if you are a person who's an employee, part of the staff of an organization, you have to then really think about the values of that organization and do they match with your own values, and can you be your authentic self? And I think that I didn't realize that when I first started in the job market. Whereas today, I would say after learning some hard lessons with some terrible feedback, to be honest with you <laugh> about how I needed to conform more. And then realizing that that was just not me. Trying to contort myself into another version of myself was so taxing on top of everything else that, and I talk about this with … I'm really lucky to be able to work with an executive coach. And one of the first interviews that I had with her was … we were talking about me generally, (and learning) that I really only know how to be me.
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And so given that I know this about myself, you know, you do have to be choosy. Sometimes you're in an environment that maybe doesn't appreciate what you're bringing to the table. And right now in this environment, I think employees need to think about that themselves, and I encourage them to then make sure. You need to opt into an organization, opt into a job. And if they're not appreciating you for what you're bringing to the table, think about whether there's a better place. Either within the organization with another manager perhaps, or within another organization that more matches both your values and who you are as your authentic self. But it's so important. I just felt like I've spoken to so many CEOs who perhaps kind of withhold someone. There was someone who I had seen on a panel. And he's part of the LGBTQ community. And he said that for many years he left that at home.
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And when he was at the office or when he was leading and he was the CEO, that personal side was not something he talked about at all. He stayed away from it with a 10-foot pole. And I think then what he realized is that he was just closed off and employees were then not able to feel that connection and be engaged. And when he eliminated that wall and he was like, why is it that I'm doing this? I am at the office. I'm doing work a lot of the time, and it's a shame not to incorporate the personal into it and to talk about those things. Talk about the real things that everyone is going through. And I think he found a huge amount of success post-facto once he started to do that. And it was just because he could just be himself.
Justin Mack (
It takes that weight off …,
Amy Kadomatsu (
It takes the weight off, and you just feel like you're not an imposter. You know, talk about imposter syndrome. And in this case, it's not about being an imposter related to the work that you can or you cannot do. It's really just you're trying to conform to this idealized version of what you think the organization wants of you. And so, to your point, what's really funny is that a couple of years ago for our rally cry for the organization, I talked about us marching to the beat of our own drum. And then I brought music into our town hall, which I think was shocking for some. It was like 10 o'clock in the morning <laugh> for a town hall. And I had the White Stripes going with "Seven Nation Army."
Justin Mack (
"Seven Nation Army." It had to be. Great choice.
Amy Kadomatsu (
Had to be. Had to be. And people hung up on the phone <laugh> to hang up on the conference call, and then they dialed back in. They were like, oh, I was really in the right town hall. And it was this change related to our business. Compliance software, compliance technology, compliance in general is a very serious business. We cannot take ourselves that seriously. And so music is a big part of us as an organization. And it's a kind of an outward play in terms of thinking about us and our values: How can I help? Team before ego. Hungry for more.
And those three things are the drivers of what we want to bring to the table within the organization itself, and it's just so important. And so I think that's where it's like if you feel that you are holding back, maybe try not to. Try shed some of those outward pieces of armor. And I think, I can't speak for you, but I know for myself, that armor is many years in the making. So it's very difficult to shed that <laugh>. But I think at the point in which you do, then it unlocks a lot for other people to be able to see you and to be able to engage with you in a really authentic way.
Justin Mack (
Absolutely. Finding the strength by taking off the armor. I love that comparison. All right, now we're actually gonna take a quick break and enjoy a word from our sponsors, but when we return, we'll have more with our guest this week. Amy Kadomatsu. Talking about compliance tech, the state of fintech innovation, and some of those patented FP Podcast good vibes. Stay locked. We'll be right back after this break.
And welcome back to the Financial Planning podcast. I'm your host, Justin Mack, and we're diving back into our conversation this week with ComplySci CEO, Amy Kadomatsu. And Amy, before the break we talked about the award, but then we transitioned into the serious business of compliance tech. And it has been a busy time for you guys this year at ComplySci. I want to talk about some of the new things you're working on, focused on education. And what you're looking at for next year as far as compliance trends and things chief compliance officers need to keep their heads up and on a swivel for going into next year. But what's new with ComplySci in the world of CCO education.
Amy Kadomatsu (
CCOs, I think if you talk to every single chief compliance officer or a compliance administrator on the planet … there's a steep curve of responsibilities and new things that they have to learn and be on top of. And they feel like they're being pelted left and right. And so this idea of education is really this just recognition that you can't know a thing until it becomes a thing. So I'll give you an example. Cybersecurity is one of those things that came on. Ten years ago, no one was talking about cybersecurity. But then the SEC made it an important part of a compliance program. And if you talk to any CCO today, it's probably one of their top priorities, to be honest with you. And this is not just like a flash in the pan. It certainly was exacerbated by the pandemic and everybody working from home because all of a sudden you couldn't just see people in the office. You had to monitor them while they were doing work remotely at home.
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It's not like the market stopped. It's not like things stopped happening. And so everybody had to really put their cybersecurity hat on. But to a T, I'm not sure that I know anyone yet who's a chief compliance officer who also was a technical engineer in their background or in their undergrad. So in many ways, they are trying to become a master and really understand the nuances and work with their partners internally on things that they didn't go to school for. And so you've got this constant wave. ESG being on a whole other topic that has come into the realm. And I think that many compliance officers are also taking the ESG hat and needing to get up to speed on what it is that they should take forward on that front. And so here you've got this constantly evolving set of priorities and regulations that they've got ahead of them.
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And as an organization, let's say, starts. So you can talk about a private equity firm today. It's a small single-fund private equity firm. But as that organization grows and you think about the complexity of a multi-strat organization, then the kind of regulation that they might be subject to also changes and ebbs and flows. And so in thinking about that organizational complexity and what the compliance officer needs to be thinking about and know, it ebbs and flows over time. And that's the reason why you need to have continuing education, really to think about not only what are the new topics that are important for the year based on what the regulators are saying and their priorities for the year. But also then making sure that your team is aware. So as your teams grow and you've got people located all around the world, as an example, you need to ensure that those compliance administrators are all up to speed as well.
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And so therefore, we actually host probably 100 webinars a year. Across three different areas. So there's externally focused webinars, and this is where we actually have just completed a three-part series. The first one was related to evaluating potential technology solutions. How to think about the ROI. So one of the big things with regards to a CCOs job is not just let's think of whether there's a technology solution. I happen to be in the technology business, so of course I'm like you should buy tech. <laugh> But from the CCO seat, they might think that you need to do that, but you also need to justify the spend. And so a lot of this is, how do we take a practical perspective in helping learn from other practitioners in the business, and how do you put together the ROI so that you can present to your internal management?
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So we did that. A second part of the series was related to the gaps in pitfalls to watch out for as you move to one system from another or you bring on an entirely new system. A lot of that relates to the rollout. Oftentimes in compliance, you make a choice within compliance, but it affects your entire organization. So whether you have 10, 50, 10,000 employees, the rollout process unto itself is a huge project management daunting endeavor. And that unto itself I think means that then you have to plan in a different way. Oftentimes, a compliance officer is not the person who's like the best project manager on the planet. That's not what they were hired for. And so I think it is really thinking about how you do this and you take it forward in a good way. And one of the most recent ones that we did, which we just did on Oct. 6, was related to how to prepare and remain compliant for an audit, which has been inclusive of one of the people from our organization, Chris DiTata, who's been at RIA in a Box for a long time and is a VP and general counsel there, as well Jason Scoffield, who is the CCO at Audax group.
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And that recording is available on our website. But I think this idea of you're constantly either preparing for coming off of an audit, or preparing for a mock audit of some sort or coming off of a mock audit. In addition to that, you're always thinking about how I can do more with less? And so this idea of us helping CCOs think about what their processes are, their decision making within that, and making sure that we're providing content that is relevant to them at each step of the process is super important. So those are externally focused. We've got internally focused, which are things like your basic, how do you use our platforms? We have a number of different products within our umbrella, and they're all complicated. You have to become expert users on those particular products. And so we often have onboarding sessions as well as deep dives and open-ended feedback sessions so that people can come in to really tailor their programs and their usage of the product to what their needs are.
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And then this last piece is really then continuing education. I don't know if you knew this, but through our organization, we created the IACCP, which is another long acronym, <laugh>. It's the Investment Advisor Certified Compliance Professional Designation. And it just rolls off the tongue. But the IACCP is what I would kind of characterize as an executive education program for compliance teams. And so I have clients who send every single new compliance person who comes onto their team through a program like this. It gives you the nuts and bolts areas that you should be thinking of. It tailors the content to particular areas. And so you're able to then create a certification related to compliance, because as you may or may not know, it's not like you go to college and there's a major that's called compliance. It doesn't exist. So what we're helping, and what we see is a need in the market is really this area of making sure that we're in lockstep with our clients. And part of that is related to education. And we're really excited to be able to bring so much programming to bear.
Justin Mack (
Definitely. And we imagine that's hugely beneficial, especially with the movement. And we cover quite a bit of it in the industry. So many folks are going independent. So many folks deciding to strike it out on their own, and now suddenly, they are now their own chief compliance officer and they rely on tech like yours to fill in those gaps. But like you said, there's no compliance major, nor are they tech experts. They're advisors. They might be people-people first and tech-people second. So they have to be able to wrangle all this powerful tech and realize, okay, how do I use this to make my life simpler instead of harder? Because I imagine if you get it wrong, it becomes another box of wires to untangle. And we don't want to create that situation.
Amy Kadomatsu (
When can I still receive a number of the incoming contact requests and things like that. And I tend to look at those to keep a pulse on what's coming in the door and what people are asking about. And a lot of it is, please help me answer these questions. I'm not sure exactly where I should start. How can I ensure that I'm doing all the things that I need to do? And to your point, I think you've got people coming into this business from all different perspectives. There might be a person who is a people-person first, and they're putting up a shingle, and they really gotta get up to speed. It could be another person who's coming out of law school, who's going into an organization to be a compliance administrator. Most people overall don't have either the tech background or the statistics background, the data background, to bring to bear either. So there are a lot of pieces that come together that really allow us to help our clients have an excellent program and take that into the future.
Justin Mack (
Definitely. Now, to kind of wrap up a little bit, we've been through a lot of what you've been doing this year in 2022. A busy year, you know. CEO, entrepreneur, DEI award winner. Wielder of long acronyms and many titles. So I have to ask, when you look back at your career, how much it's changed and which you've accomplished, if you think about your favorite part of the job, what would that be? I don't know if that's something that's changed over time or if there's a core thing that's kind of driven you from day one through right now in your career. What's the thing you love most about being in financial services?
Amy Kadomatsu (
So I would say, I'm gonna change your question slightly, which is that what's my favorite part of being the CEO of ComplySci? We did something early on when I became the CEO which was that, I asked to meet with every single new joiner on the first day that they join the organization. We now hire more than a few folks every week. And so the clip has gone up a little bit more. And so we try to get everybody that first week or two weeks into their joining of the organization. And to be honest with you, it is one of the highlights of my job to be able to welcome people to the organization. It's an AMA style (meeting) so they can ask me anything. And it's really pretty wild as to the kinds of questions that I get in that.
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But I think it is really in those conversations where I can see the diversity of backgrounds. People who are maybe pivoting from another career to a career here at ComplySci. There are people who are just coming out of college and this is their first real job in their lives. And I think the kind of excitement that they see for the organization, and I'd like to say that I grew up as a young child thinking that I was gonna be the CEO of a compliance company. But I think you and I both know that that's not true. But I think the kind of enthusiasm that we're able to get from all of these folks to join in the mission for us to become the first call for CCOs. To be that partner to chief compliance officers in the world is really … I don't know that there's any feeling that's better than that. And hopefully we'll continue to attract really amazing folks to our team going forward.
Justin Mack (
Definitely. Well said. And I don't think there's any better way to end it than a real life example of what you said earlier. Bring people in and then remove that armor right away to get to know them a little bit better and keep that line of communication open. So love to see you living that. And I appreciate you again for joining us this week on the Financial Planning Podcast.
Amy Kadomatsu (
Fantastic. Thank you.
Justin Mack (
All right. And I wanna thank everyone for listening to the Financial Planning Podcast. This episode was produced by Arizent, with audio production by Kellie Malone. Special thanks again to our guest, Amy Kadomatsu, CEO of ComplySci. Rate us, review us and subscribe to all of our content at www.financial-planning.com/subscribe. from Financial Planning. I'm Justin Mack. Thanks for listening.