Ruth Porat, CFO at Alphabet and Google
Ruth. I'm so glad to be here with you today and, as. We, learned from Laura's amazing. Introduction, Ruth, grew up close to Stanford, where, her father was an engineer at the original slack Stanford. Linear Accelerator Center, and her mother was a psychologist. Ruth. Thank you so much for joining us today. We're. All familiar with Google just a quick poll who. Here has used Google, search today a. Hundred. Percent how. About who here has worked or will work at Google. Wow. Ten. Or so excellent. How about her yeah. Who. Here has been in way moe or in, a, way Moe self-driving, car. Okay. So four, or five who. Here would like to try, out a way Moe self-driving, car. We're. Back to 100%. So Ruth. It looks like we have some beta testers, for you here today if you need them perfect, there's, so much to cover from your early beginnings, to Morgan Stanley, -, now alphabet, in Google so, let's jump in, before. Your parents landed, here in Silicon, Valley they. Had, a very, very, difficult journey and. Your father fled, escaped, with his life from Austria in World War two how. Was your family history, shaped, your values. Well. Probably the most important, thing my father always, said, is that education is, your passport for life and the, reason he said that was very much to your point he, fled Austria, having, been thrown out of high school he's. Jewish and. Was. Fortunate to be one of the few to get, out his family did not he was young, enough that he was on one of the youth boats went to Palestine, and as, soon as he could he enlisted, in the British Army and while. He was actually. Fighting in the British Army it, occurred to him that if he ever wanted to live in a place where there was freedom for him and hopefully a family, that he would one day have he. Needed a skill that, people would value and he concluded, that that would be physics and so somehow. While fighting, the British army he started, to teach himself physics. He sold his cigarettes and somehow got material to teach himself physics. And his fellow soldiers would tease him and say you're gonna die before you can ever use this and his, answer was always I would rather die an educated, man and he, told us that story, frequently. And it. Made, it hard if we didn't do really well in school because like I didn't even have the benefit of all this stuff so he should do really well but, it was a really important, value one, the importance, of education, and two the gratitude to be in a country where. You do have freedoms that so many people don't have and so those are probably the most profound my, mother was amazing, a, psychologist. And I remember as a very young girl I was born in England and I'll. Never forget the day I was 8 my sister was 6 I know that because it was shortly before we moved back to California and. She. Said you know it's very important, as a woman to have a career, just telling an eight-year-old and a six-year-old that which he thought was a perfectly, normal time to give you career advice but. She made the point that every, cent she made went to her nannies she worked and I think there, was part, of her that felt this guilt that many of us feel that she was working a lot but she was also talking about the gratification. She, got in which it meant for her to be able to work, with others and why it was important to find one's passion so I think they very much shaped Who I am and I'm eternally, grateful to them. You. Took the commitment, to education, and career of course seriously, you graduated, with three degrees in, 1987.
When You graduated, from Wharton with your MBA you, accepted. An offer at Morgan Stanley to join the mergers and acquisitions, group the hottest role at the time, women. A few weeks of joining the, stock market declined biggest, decline in Wall Street history, how. Did that how, did that, shape. Shape, your experience or what did you learn from that experience, well. It was pretty terrifying, I started in August of 87, in October of 87. On a percentage, basis, was the biggest decline ever and so I sort, of thought my career was over before it had even started, and. When I joined, Morgan Stanley I was of the view that, would only do mergers and acquisitions, like I just knew, that's what I was interested in and. I. Would rather leave the firm than do something else but of course markets, change an opportunity, has changed, and probably, the one of the most important, things is somebody. I really respected, who I had worked on. A deal with said hey we're gonna create this new thing, it's gonna be covering, private, equity firms it hasn't been done on Wall Street before and at, the time I thought it was a really bad idea and why would I want to go do that so I said I would hedge my bet and do it half time and within, no time realized, it was a really exciting thing to do and it was the. First time I realized, that if you're working with people who are really smart and take. A risk on you they may open doors that you don't even appreciate our, doors, to be opened and it I didn't, use the word sponsor. Back then it probably took me another decade, or two to, appreciate. That's really, what I was looking for, but. It it, led, me to another place that I hadn't, expected. And I think the willingness. To be flexible and, adjust, as the, world adjusts, or as you adjust or as your life requirements adjust was probably one of the most important things I didn't have an option the world changed, but fortunately I wasn't rigid. One. Of one of the statistics that comes to mind is that for, us many, of us are about to graduate and half. Of us switch jobs within five years of graduation, and you, mentioned and you mentioned sponsor, or, the idea of sponsorship and you. Yourself. Switched. Out of Morgan Stanley to. Join Smith, Barney following, a sponsor, and you've, noted in the past that you immediately regretted. That, move so. How health. Us how did you recognize and. Fix, your perceived mistake. So. I choose. To say that that period of my life didn't actually exist but you're taking me there. Thank. You for indulging me so, two. Of the people I worked really closely with we're leaving Morgan Stanley, and asked, me to go and actually run this private equity coverage, group which. It seemed like a wonderful step up and it could be really exciting, but I really, loved Morgan, in fact my father said he was surprised when I chose to leave because I loved the ethics of Morgan Stanley that was the word that, he chose to focus on at.
The Time I was pregnant with our second, child and, a. Managing. Director at Morgan Stanley in front of me at one point had, said to a client, women. May come back after their first they never come back after their second and I, was terrified, that what had been a really great, career, where people were looking out for me might, get derailed quickly, because, maybe the, people I've been working, for men, because, they were so few women back in the day in leadership positions maybe, they got it and they had ethics but maybe this thing I had heard was. More pervasive and, I. I kept hinting that, I, was concerned my career, wouldn't, stay on the pace it was and, nobody quite got the hint nor did they know I was pregnant and that's why I was really concerned and so I left and after, a couple of months I said you know the culture is different and I want to be back at. Morgan, Stanley and I, went back and I actually spoke to, the. CEO. And said here's here's, the subtext, I never shared openly which. Of course his immediate response was that's ridiculous, of course we want you back and yet. Because. 40, people followed after I did, the door was shut and the. Lesson, to me is if you're thinking about switching put, everything out there the, worst thing that can happen is, someone will tell you sorry. No I'm you, know I'm not gonna I'm, not gonna honor. That which you want and you should go but, you might actually find they do and if you find that they do you end up having the choice you want and if you find that you didn't so, they didn't you don't have any regrets cuz at least you know you tried the. Reason I was able to go back is another really important lesson of those 40 people I was the only one who got the opportunity, to return and. I think it really goes to this mantra I lived by which is the, world is small and life is long and so, make sure everything. You do you do in a high quality way and so, that enables. People to say I should come back at a certain point and I got the call three years later but it was there, was so much in there and anytime someone's, coming, and telling me they want to switch careers I tell. Them this story, put it all out there, make, sure you've left nothing unsaid, because. You might be surprised, and people might say you know what you're you're wrong and you should come here and or here's a better opportunity here, and, you'll never regret it thank. You that will be helpful for the two of a hundred of us switching, jobs in, a few years time. So. Let's, fast forward a bit it's September, in 2008, by, this time you have proven, yourself, at Morgan, Stanley many times over holding many of the titles that Laura read one. Of which was vice-chair, of investment, baking, but. Also the. Economy is tanking, Hank. Paulson gives you a call, asks, you to please help him save, the financial system. Wasn't. Lee, an advisor to, the US Treasury yeah thank you yeah I need your color so please. Could. You please ugh walk us through that experience and, what you learned, well. It was so. July it was actually July of OE he, called and said I I need some help on, Fannie. Mae and Freddie Mac understanding. What's going on with the housing crisis, and so. Team and I went down to the. Treasury Department, and of course July, of o8 shortly. Before the election, our question, to him was do, you want to kick the can down the road to the next administration or. Do you want to deal with this and his. Comment, was I don't think we have time I'm, concerned, there's gonna be the, proverbial run, on the bank let. Me understand, when, Fannie Mae and Freddie Mac will not be able to fund themselves anymore and. This. Was a five trillion dollar balance, sheet in the aggregate and his concern, was were, we at the brink, and. And, he basically said analyze every component of it what's the funding what's the capital what can we do what are the options, and. That's. What we did around the clock until. September. Looking, at what were the alternatives. How. Stressed, was the housing market, what did it mean what was the risk what were the options and, it. Was extraordinary seeing, him in action and there are so many lessons learned you, can't learn while, you're. In that was that you have to have the team that actually has instinct. Based on experience, and, it really informs, how I think about the type of team I pulled together I want. To have a mix of people who. Are extraordinary. Entrepreneurial. Will walk through any wall because they don't know you're not supposed to walk through any wall with, people who have what, I call battle scars they've seen three four or five chapters, ahead and it's that mix that enables. You I think to come up with creative but. Implementable, solutions, and so, we literally, went around the clock till September, then announced. The. Conservatorship. As it was called the the path forward for Fannie Mae and Freddie Mac and, went.
Around The globe because his his concern at that point was we need to make sure every, central. Bank that holds US, Treasuries, or these securities, understands. That we're really protecting. Their. Holdings, and in US. Treasuries, and what's going to happen with the economy and came. Back from that and that was kind, of step one and what continued, to be a pretty painful fall. Why. Did you decide to join that team it sounds I mean you're, not one to shy away from work but it sounded. Particularly. Precarious, well. It was there, was more to it than, than that and it sort of goes back to your first question about, my parents. When. We were asked, if we would advise the US Treasury one of the questions, I was asked, by the senior. Leadership team at Morgan Stanley at the time is if we were not advising, the government what, would we be doing for Fannie Mae and Freddie Mac and. What. Would the fees be to, be quite blunt about it you, know if we were advising, Fannie, Mae and Freddie Mac and, their initial conclusion, was we probably. Shouldn't. Take, on this assignment, and. I. Remember. Saying there, are certain times in history where there's only one right option, and this is the wrong option and, fortunately. One of the people who is still at the firm whose extraordinary. Completely. Agreed and. The. CEO had already gone out to make a call to Hank Paulson, to turn down the assignment when, we had this second, round of conversations. Fortunately, Hank to not pick up the phone and so, we came out and said you know there's only one time there, are times in history there's only one choice and you must speak up and you must do the right thing and in, my view was that was one of those times if we were being asked, to help. At a time that was so precarious for. Not just the US economy about the global economy and we had skills, that would be relevant we should we should serve. So. Message. There is easier voice you're.
At The table because people want your voice and I think it's very easy sometimes to forget. That or not be sure you're actually saying something the right way the number of times I've said something and then I go home and I say did I say that the right way maybe I could have said it better and then you're like you know what don't. Keep second-guessing make sure though that if, you have a point of view the, reason you're being hired is people want your point of view it's really important, for me learning. Thank. You. So. Moving, moving a little bit ahead - there's so much to cover I think. So you tell me let's see so. February, 2015. Also, correct my days. Upon. Writing the Morgan Stanley ship you went on to serve as CFO, for five years, you. Consulted, Silicon Valley executive, and coach Bill Campbell. About. What you might do next. You've. Reportedly, told him that you didn't want another CFO, job correct. I was. Very clear minded about that. What. Made the Google CFO job different, or, compelling. So. You. You've, got the chronology right I've sort of gone through coming. Out of what was a really. Painful period, for Morgan Stanley as, well and. We. Worked over the, ensuing. Number of years to really position Morgan, Stanley I think quite well I think the CEO James Gorman is extraordinary, and it was wonderful, working with him but. I sort of reached that point where I said you know I I, want. An I don't want to look back in five years and say why did I do that next five years and what's. The next mountain, that is out, there that's going to be really exciting, that I can be proud of and. To. Leave Morgan Stanley, and CFO there and like I don't want to just go do that and so. I thought, I knew I didn't, want to just do that I didn't want to be a CFO and so, I went to Bill Campbell an extraordinary. Person, book. Just came out about him the trillion dollar coach that, really gives his words of wisdom and it, was really just to get some guidance how to think about what, that next chapter might, be and he, did ask me so do you want to be CFO I'm like no bill one thing I know is I don't want to be CFO and he kept returning to, that question, and after. About two hours he ended with that question so the one thing you know is you don't want to be see if I when I said correct and he said then I have the perfect job CFO, of Google and. Literally. Within a second I said well if you're serious of course I'm interested in, that and. As. I told you change. I'm flexible, so it. Hadn't, even occurred to me and it you know Google was the company, that. I had, loved for a really long time first invested, fortunately. Through an angel fund in 1998. Was, part. Of the IPO back in 2004. Thought, that you know thought and think the founders are extraordinary the mission is really inspiring, and. So. It I left, his home still. Not believing it was possible, but it was it's just a it's an amazing place to be. When. You joined Google. Was known for its slogan don't, be evil less. So it's processees, arguably. And. You. Had the way to. Financial rigor, including. By having managers set business milestones, and even. Factor, in the cost of employee stock options, into. Their budgets something, they hadn't been doing before, this. Was leadership in the truest form it. Wasn't easy and it wasn't popular your. Focus on return, adjusted, innovation. Earned you nicknames. Like, ruthless. I'm. Called Ruth full last week it was not bad I'd like that like progress, it's. Very creative of them and this was this was from people who were, accustomed, to a more freewheeling culture. How. Did you balance the trade-off of instilling. Discipline. With. The appearance of curtailing, Google's, innovative, side, well. First I think if I did not believe in my core which I do that, investing, for the long-term is what every leader should do I, wouldn't. Survive there, and I wouldn't be accepted, but, I think that what I've seen throughout my career is, that if you don't invest for, the long-term you're, actually, sowing the seeds of your own destruction. And I actually learned that really. Early on at Morgan, Stanley I had the opportunity to, work on. An. M&A deal the hostile defense of Gillette and, that. Deal, was subsequently, written up in the book from good to great and the reason, was. So. That was the subject of this hostile, takeover, we were asked to find a way to defend, them but, the CEO at, the time Colin, McClure I'll never forget it the most extraordinary man, said. You can do anything you want but you can't touch my R&D budget, and I will not tell you what it's for but I will tell you that, I do not want to be independent, if I do not have those R&D, dollars and, at, the time it was frustrating or like we need some of it we've got to have some of it and he was adamant, we.
Were Able to keep the company independent, and years later only years later did we learn that was the sensor raiser and he. Was right when he said without, that R&D budget without planning, for the future it's just not worth it so the. Most important, point is I do believe it's imperative to invest for the long-term I think the other thing is people, need to make choices and, that. Sort of goes to the financial, crisis I learned so many things working with Hank Paulson one of the things he said was that you have to have. The. The, will and the means and, too often by the time you have the will mainly, the political, will you no longer have the means and when, I moved out here from New York and I was often asked about the financial, crisis, I thought that was a bit odd because, things. Are glorious and growing out here and that's very different than the days in the financial crisis but then I realized that some of those lessons were as relevant, here as they, were during the financial crisis, which is don't. Waste the, really good time and spend. Without or invest, without care, - whether it's a great idea or a mediocre idea just because you can put. Your effort. The things that matter make sure that you, when you have the, means you, also have, the will and so all I was trying to do and have been trying to do is create. The. Visibility. Into the, data so that our amazing, business. Partners, can, make the choice it's not me making the choice I think that would be grossly. Arrogant. To think that if you're not the product, leader you know how to stack, rank all, of the incredible, things you're working on but. Until people have the data it's hard to make the choices and. There's. A phrase, also, at alphabetic. Google anchor everything, in data and the rest will follow so, my goal was actually to just. Give them the data in a way that helped, people better understand. How, much they were putting behind each each of the various options so they could then make choices, and stack rank now obviously, unless you, squeeze the envelope, tight enough nobody has to make choices so that's where probably the.
Some. Of the nicknames come in but. But. But it for all of you the tools that you have the, skills that you learned here the ability to lay. Things out clearly, if you anchor, everything, in analytical. Rigor the. Data should, help, guide the best decision, making, was. That something, that you had also, done when you took on the CFO role at Morgan Stanley is that is that something that you had to implement, in place or was it there oh I think that on, every, every, assignment, that I worked on as a banker, my view is let's. Start at with, the question, to whoever the claim is here's. My understanding. Of your. Hierarchy, of objectives, do I have it right like, I want, to hear what. People are solving, for and it can be. Intellectual. It can be emotional whatever, it is what's your hierarchy of objectives, once, you know what you're solving for you can come up with a solution and then. The, answer has to be able to be in my view presented with analytical, rigor because numbers, are a way of framing what's the opportunity, to set what are the trade-offs what's, the downside potential, but, the numbers, actually. The clarity of thought like one of my dad's lines, again. When I was a little kid he he came home from slack and he said if, a, physicist. In his lab could. Not define, a quark in less than 60, seconds, they, did not know what they were talking about and I've, used that quark test for years with colleagues, like if you can't tell me what. You're doing and why in less than 60 seconds, it's, because you're not thinking clearly and if you can't express it in numbers you're probably not thinking clearly, so the quark tests at, Morgan Stanley and amongst my Google colleagues they they know what the quark test is and I think it's a really helpful way to try and get a pithy. Answer, although this is not a pity answer so you may say did I pass the PARCC test but, you. Pass. Ok. So turning, to six months ago. Thousands. Of employees, walked. Out of your offices, around. The world after, the New York Times reported, that Google, paid over ninety million dollars in exit packages, to executives. Accused. Of sexual misconduct. Your. Team walked out - and you. Went with them why. So. I firmly. Believe. That. Diversity. And inclusion, and, the, highest of ethics, is the way we, look to comport ourselves and, we, put so many programs, and policies, in place to ensure that we're. Continuing. To to, do things in the highest-quality way, and we're, all in this together and to me that was the most important, message we may not always get things right, but. I think compared, to every place I've seen either as clients, or where abort I think we try at least as, hard as anyone and we are as a leadership team are really committed, to getting it, right and I just thought it was really important to be with the team to say we're all in this together we're, we're we'll, address.
Issues, We'll solve issues we're all in this together. Thank. You it's an ongoing it's, an ongoing discussion and and, and that, was very, interesting to be able to to, hear about it thank you, you, did mention it. Harrison between, Wall. Street and and. Financial. In the financial, industry you. Were on Wall Street when it was fearing and being skewered by occupiers. Politicians. Main, Street and, arguably. Now you're, in Silicon Valley when the cannon is turning towards, tech, giants amid calls for data privacy. What. Learnings for from The Wall Street context. Do you apply to Silicon Valley today, I, think. Probably the most important. Were. There many important, lessons but one of the very important, ones is to, constantly, try and raise the bar on yourself, and. You. Know for. Us one, of the really, got important. Guiding and, a mantras, internally, is the, importance, to respect the user and respect, the opportunity, and we. Do keep trying to raise the bar on ourselves, on anything that will address, both. Of you know both either of those, very important guiding principles, and, you bring up privacy, privacy is a great example from the earliest days at Google there. Was a deep deeply. Felt feeling, deep ruk recognition. That, privacy, is sacrosanct, that the data are your data and that we need to make that really clear and everything we do so Google was the first to, make. Sure that you could take your data with you all. Of the controls around privacy, we do constantly research. To try and make them as simple and streamlined as possible and, just announced, changes to that again. Recently and, you. Know sundar has. Been outspoken talking. About the imperative. To support, federal. Legislation. Around privacy, as well we, did 18, months of work leading up to the. European privacy, legislation gdpr. So. There are places where it's about upping the bar on yourself, and speaking. Up where it makes sense for, legislation, in some places it, it is, important, to have legislation, that's a great example in, other, places there are things that companies should and could be doing individually. But, I think I saw, that on Wall Street as well some companies just kind of have in this and I wish it was yesterday and didn't recognize no, there was a lot that needed to change some. Of which should be self-imposed. And could be more rapidly. Implemented. If you were doing it on your own and somewhere, actually legislation. Did make sense. Okay. So legislation. Is interesting, to me I have a question for you that is unique to you, you're.
One Of the few here in Silicon Valley who. Has also worked at the Department of Justice. And. Treasury, and Treasury, yeah well you seconded to Treasury yes. That's. Right, after Stanford yeah Wow. There's a lot of research. You're. My hero rooms I got, to research you I may have known some. Of this organically, they. The. Department of Justice and other policy makers around the world are debating. Today whether. Technology companies. Like Google, Amazon and, Facebook are, monopolies. As. Someone who's seen. Both sides do. You think that there's a point at which these big tech companies might become too big. So. A quick aside I was a first. Year out of Stanford intern in the Civil Division so my answer has nothing, to do. That, means Jen. Look I think that there's. There's a lot of the question if the reality is when you look at. The. Experience for consumers we're. All benefiting. From ever lower prices, more access to more products, we're, seeing innovation at, a pace, that, is extraordinary, and, the funding, around that it. Last year was at the highest level ever so there continues, to be a really vibrant. Ecosystem. Which. You know I believe we're. All benefiting, from as users. Great. You. Talk about. Greatest. Source of vulnerability. What. Do you think is Google's greatest source of vulnerability. So. That where that comes from is one of the many lessons coming out the financial, crisis, was that, it's imperative to identify, your greatest source of vulnerability, and protect, against it in the good days and for. Banks, it was liquidity, without, liquidity, you choke and that's what happened to individual, banks and that's what happened to the financial system and so, then I asked myself that question when I got out heroes kind of if I'm going to talk about that, was one of the lessons how do you apply it to technology. I think the greatest source of vulnerability, for technology, is not continuing. To invest for the long term and focus. On innovation, so if you look at the companies in technology that were the leaders 20 years ago most of them are not still the leaders and so it really is this imperative, around. Investing, for the long term and what one of the many things I love about the approach at alphabet, from. The earliest, days was, really trying to think through and seed. Innovative. New technologies, so in the earliest days you know they came up with an idea of 20% time if you had a great idea let's give you 20% time, to go pursue it and out of that for example came Gmail, then. Was the idea of X but, it's now affectionately. Known as our moonshot Factory maybe you go do it a hundred percent of the time and you try and come up with what is that moonshot, that's, where we mow which, all of you hopefully will be in soon enough that's. What we know and our life sciences, business fairly came from and and. You know alphabet, in many respects, was the third iteration, we, tried, to come up with a structure, we came up with a structure that said Google focus, over here and let us really. Continue to go deeper in what might, be those next things that are out on the horizon but I think it, really is about the imperative. Of focusing, on the long term and not getting pulled into short termism. How. Does alphabet, when you restructure, it it in, 2014, 15. 15, thank you how, does alphabet. When. You were stretch in 2015, the vision that you had for alphabet then how does that compare to what it is today. So. Time doesn't stop but I think that the main the core of it and Larry, said it well in his letter announcing. What, are the goals for alphabet, was really to be able to have google focus, on the, many extraordinary. Challenges. And. Opportunities. And. It. That it faces and, not, focus, on kind of the next set of things that are being done in. Other bets and you, know enable Larry and Sergey to go really deep there and so that's that's, what we've been living I. Have. Another intersectional. Question for you because you, have. This old hat of being a star investment, banker and now, you are, you. Were the recent, hat of leading, leading. This amazing, company as the, CFO. What. Do you think of the uber IPO. Oh. Uber. Is it's. An extraordinary product, I think it's changed all of our lives and, it's.
Still, Very early, you, know it's early days post type pricing. Okay. Now turning, turning to you as a leader thank you roof, has seen, 750. Tech IPOs is that right I was, I have encountered all but it's been a lot oh I've been counting. So. You, you personally, spent almost. 30 years on Wall Street where. You grew. And businesses, and stabilized, ones on the brink of crisis, and you're. Now here in Silicon Valley where as you said your positioning, alphabet, for long term success. What. Traits do, you have that. Enable you to be successful in two very different worlds. Let. Me sort of reframe, that question. The. Because, I feel like I'm thirty. Sounds like a long time but I still feel like I've got a long way to go so the book hasn't fully been written but what do I think is important, if I were turning back the clock to when I was, exiting. Wharton. I think. One. Of the most important, things is clarity of thought and really, being able to. To. Analyze. Crisply. And articulate. What you think is important, and, I've. Already said it but it's important, to use your voice at the right time don't be in a room and not use your voice I think. For the underrepresented, groups. Here that. Can be hard and I. Think it's much better today than it was when I got out but the number of people who would speak over me or. You. Know sort of to try and diminish you and I even say it today the sámi seemed like a really odd, place to go but I think it's a really important message for everyone which. Is when people speak over you even though that may feel like it's a small thing it is not a small thing because, every, time you're in a meeting if somebody's. Saying you know I don't really need your voice I'm gonna speak over you after, a while you. Sort of internalize and say if you don't need my voice why do you need me. And so, it is really important, to stake, out your place, and make sure your voice is hurt and today it's easier to do that if someone tries to speak over me I'll literally, put my hand out you know I'll say let me finish do. That for others if you see it happen, and make, sure you're working for somebody who gives you that space, so. Finding, your voice is really important, and then getting a sponsor, getting. Finding, someone who will take a risk on you and, open. Doors for you probably the most one that I had, throughout, my career I could, talk about people, who did that for me but maybe one of the most most, important, other than Bill Campbell, was. The, conversation, I had when I was asked to take over running, the financial, institutions, group and. I, had had a career where I covered, technology, companies, and, media companies, and private equity companies really like fun stuff in my view and then, I was asked to cover banks, and asset managers, and insurance companies and so, probably not surprising that some of you my reaction, was wow that's really boring why would I do that, and, the. Person who went on to become the president Morgan, Stanley said you gotta trust me on this it's gonna ne literally, said it's gonna open doors that you're not even aware of I can't even tell you what they are this, was in 2006. My instinct. Yet again was just wrong it was no that sounds boring I don't want to do it but, when he said trust me on this I said, okay and then August of 2007. When you were actually at a bank is when you first saw the cracks in the in the financial, system and so, I had not, quite a year to, figure out which way was up when, it was clear, there, were problems on the horizon that led to the role with Treasury, and Fed that led to the CFO, role at Morgan Stanley that, led to being out here so, I think sponsors.
And Having that honest conversation are. Really. Important so I'd sort of put all of that together I. Understand. From a conversation I had with Jeff Immelt last week that a former. Partner of yours that you not only have a strong voice, but he is the only he said that you were the only person that he likes to get bad, news from I. Gave. Him a lot of bad news. And to, that end he said that you have an incredible, serene sense of calm that was incredibly, rare during, the financial crisis, and you were the only one he saw through. Through, the whole storm, that, had it. Supposed. To comment, no. III want. To toot your horn for, you because I know you may not it was actually during that period what was fascinating to me about him is he kept wanting to get the bad news and I felt. When not that he wanted to get bad news he wanted to get what I thought was truth let me put it that way I think he was hoping some of it would not be bad but, I also think that it's really important, on your team, to make sure that you are hearing those voices that are telling you something you don't want to hear and creating, a space. Or. You're drawing all of that information, out and, one. Of the two in, the book trillion-dollar, coach one of the comments Bill Campbell makes is always make sure before, you open, as the leader that you've, made, sure you hear every voice that has not yet spoken because, often times some of the ones who are the most quiet might actually have the new idea the most profound idea and Jeff. Always wanted, to hear whatever I, was. Concerned about whatever, the thought was it was the challenge, to him to the way he was trying to think about it and I think that's an important lesson for us thank. You. You, may know that role playing is a time-honored, tradition here. At the GSB. Well. We got to do it well okay might you indulge me yes, please go. So. Donald. Trump calls, he. Needs, a leader who, knows markets, and technology. No, one better than you he. Says Ruth. I need you to come on as my Treasury secretary, what. Do you say. Well. That call has in common. I'm. Really. Focused on what I'm doing right, now so. Thank. You for humoring me, let. Me let me now turn it over to my friends in the audience to, ask you to, ask you their own questions. Hi. Ruth thank you for being here today you, spoke a lot about having a good sponsor what. Were the things that you looked for in, a sponsor that you identified. Someone. Who is, smart. And extremely. Ethical, so when they were solving, a problem, they. Were thinking, about what I also, needed, it wasn't just being expedient. And solving one of their problems, somebody. I could learn from you. Know, early in my career at Morgan Stanley I worked on a deal with somebody who. Never. Took me to even internal, meetings and. After. A pretty, long period of time he took me to an internal meeting and the senior person on the deal team the partner, turned. To him, and pointed, at me and said is this the I I keep, hearing about and made it really clear that he had for months been taking credit for all of my work and. I. Said you know what that's got to stop right now and so I thought, of one of the smartest people in the department, he. Had a reputation for being really difficult, but I knew I could learn from him and I, went to him and said I want to work on anything you have whatever it might be I just I want to learn from you I've heard like you're amazing.
People. Like compliments and so he said okay and so he. Ended up putting me on a deal and the first deal was a pretty crummy deal but. We we, I learned a ton from him he. Actually, is the person who got me on that Gillette deal he, then opened the door and working on something that was that marki opened another door that was the first time I had somebody. Who I think, actually, said let me give it a go so. You have to prove yourself to the person oftentimes, people will come up to me and say will you be my sponsor and to. Me that's almost akin to saying can we have a child on the first date no you can't like, first let's have a date. Want to have a second date then maybe you know further, down the line we can talk about that so you do have to earn the right to, have. That kind of a relationship it's. A two-way relationship the, other thing I learned early in my career I, was so grateful, to somebody who was a sponsor so grateful for all the doors that he was opening and then. I realized you know what he's getting at least as much out of this as I am because, I'm great operating, leverage for him because he's giving, me stretch goals so I'm super, excited I'm, like learning I'm like it's it's amazing. To be in a position where you're feeling like you're growing so it's really a two-way street and recognizing. That as well but to, your question you earn it and make. Sure the person's really, smart respected, and super, ethical. Hi, Ruth. You have a lot of very unique experiences. Not the least of which having, been worked, both in the private well in a private sector at, the Treasury and, during the financial crisis, presumably. Also interacted, a lot with academics. Who were also advising, the government at the time how. Would you compare and contrast the, different ways in. Which the, government the. Private sector and, the. Academic institutions, lead and shape our world, it's. A great question. Like, for, me one, of the most important, things is to find a place where you care. About the mission of the organization you're, part of whether it's in the public sector or the private sector being mission, driven is a.
Critical, Element of it. What. Was intriguing, when. You're working with the public, sector is, that. Oftentimes it's. Tough, to. To. Look at you have different, constituents. Who are judging, what are the outcomes and, you're trying you need to balance sort. Of perception. Elements. As much as the content, elements, of it how, is it going to land because you have so many public constituents. That are looking at what you're doing but, I think in each instance if, I go back to the work at Treasury, what, were the key elements, it goes back to exactly what I was doing with. With public, private sector clients it's. What are the analytics. Around any judgment, you know how, much capital is needed in something well you need to put data around it we ended up as an, example running. Mortgage Analytics, to figure out how big the whole could be 24. Hours a day in, three locations around, the globe because we didn't have enough time to just, do it normal way and yet, it was the analytics, that were important, so I really. Feel like in. Any setting, what, are you solving for, what's, the data that's going to help you make the best decision, and who. Can you pull in for the best advice and this instinct, based on experience, whether it's academics, public market private market, is what's, needed Hank, Paulson, on these weekends, we were down there he, literally would pop in and out of our conference, room with ideas. And those ideas it was because he had instinct. Based on experience, and we were just looking. For whatever the, least worst solution, was and so it was this mix of public-private. That actually, helped, inform how. Do we move forward so I'm not sure if I fully answered, it but I don't. View them as ads, distinct. Because it's problem-solving for something that's important. Hi. Ruth I had a question around the. Large bets that Google continues to make so, Google. Consistently, is obviously played. A role buying, large companies, YouTube, Android, and. Over the past few years, maybe, has invested, less so and some of these transformational. Bets I. Would. Be curious to know as. Google continues to grow and the core business continues, to be something to think about do. You think transformational, bets are important, whether, acquisitions. Strategic. Investments, or another. Strategy I. Absolutely. Think, in as, I said a couple of times now investing, for the long term is imperative, and it needs to be, it. Needs it needs to be of a scale that matters that can make a difference kid that can really improve, lives. And so. Your. Your frame. Of the question well which is bets both organic, and acquisition, and I, think both are fruitful, we're investing. Quite aggressively, in a number of areas that we do view as. Important. Long term opportunities. For us so one, of the most exciting areas is what's going on with the cloud right now and we. May have started later than we should have but. We have the core engineering, pillars, that, are critical. It's you know it's the technical infrastructure, of the data analytics it's, security, it's. Collaborative, tools it's, the machine learning opportunity, we needed to bring it together and we're investing, meaningfully, because our view, is that. We're very early. Globally. In this, move to the cloud and it's an absolutely, transformative, one it opens up new new. Opportunities, for every business as. They think about what are the efficiencies, and tools and that they can. If it from and so, that as an example is a really important area you look at the way where we're all using. Devices. Today and how, do you think about what are these home devices and have searched was, its desktop its mobile it's also what, are the home devices the one has, that. Enable, you to to. Get. Whatever you want from brought. The Google home and hopefully, you all have a listen to music get, recipes do, whatever you want to do phone calls so. These are you know that our hardware effort is important, what we're doing with YouTube and subscriptions, and YouTube TV is important, what we're doing with way Mo's important, we're doing a lot in health which is probably one of the most exciting areas when you think about applying. Machine learning so absolutely. When we look at it we've got an extraordinary, business in what, we're doing with search we're, continuing, to build on that through investments, in machine learning and then we're layering on some newer areas and if, you're going to continue to invest for the long term you need to keep seating those they don't need, to all the acquisition, we do a lot of acquisitions, but you, need to keep thinking about where the world can go, or. Where you want to take it. Ok, one. Last question please. Can. People hear you though. The. Oak hole with sidewalk labs yes. Could, you talk about being a sponsor now that you're more senior and how you decide to allocate that time and what that looks like for you I'm.
Sorry Go back to so to, be can you talk about how how you're a sponsor now that you are in a senior position and, how. You allocate your time and what that looks like for you. So, I thought your gonna ask a sidewalk question for those of you don't know sidewalk, is looking at reimagining. What is a city and how do we think about every. Element of it from mobility, to building, to affordable. Housing and this. Question about where does this go I think it's a really exciting one for its society it kind of ties into some of the things we're doing with Wemo. What if you don't need to spend the kind of, Stanford spends and others do on parking garages and you can and put, that into schools and education, and playgrounds I'm gonna come to your question I promise but like when you said 500 my god there's a lot going on in the world of reimagining, what can life be let, alone the. Number of lives that can be saved when you go to self-driving cars but you have two different questions sponsors. Look. I think that to me it's exciting when, you look at people who are. Trying. To figure out where to next I as I've said many times I, am, so grateful and can name so, many sponsors who've really, been key. To my, career so my view, is that, I try and spend time every week, and. In, structured. Settings and, that. Individually, or with groups because I think there are a couple ways that you can go about actually. Helping, people as they're thinking about what next, and. It's, really about and investing. In someone's career and helping them understand, what are their options to, me we owe it to our teams to understand, what the career kind, of the arc of a career can be I'm, literally. Going through with my team now so we're and, my question is on a scale of 1 to 10 where 10 is high and 1 is low how happy are you we how, long do you want to be here what do you want next what's important, to you and those, conversations. Are really valuable conversations I. Like. To set the tone and and drive those and that to me is about sponsoring, my team but, then I'm also sending out a note to all of my team that's okay I just finished that if. I have the time to do it I want my team to be doing it with their team and so ensuring. You're in a place where those types, of practices. Cascade, is really important. Ruth, half, of us here will have graduated next, month, congratulations. All of you why we see the hands from the about, to graduate. Wow. Awesome, awesome, very exciting, a lot of exciting, things out of you I will, assure you that I had no idea I would be in this role when I was the equivalent of your seat and life is really wonderful. I'm, fine you. Are our last hope for our, final, view from the top wisdom, I. Thought. I'd ask you some questions that I know are, keeping us all up at night, are, you are you ready for a lightning round sure go for it okay watch. Game of Thrones or, eat ice cream at Sultan's draw Oh. What. If I don't do either my husband, likes Game of Thrones my, kids like he would throw and he gives me a couple hour break, to go do what I want. Iceland. Is a fun trip, if you want to go there so yeah, that's the truth excellent. How about going to tech or finance. Mmm. Well. I found, my cake and eat it too because I'm doing both but. Look. I think that go. I view. This. Is a maybe a little old-fashioned, but I I tell, my kids this still so I hope it's good advice I feel. Like the experiences. You're about to have are, a. Paid postgraduate. Education don't. View it as please, you said on average it's five years and then you go do something else be, at the place where you can learn a time you're proud to be there it has the ethics and culture you want and you're working with someone extraordinary who, knows where that's going to take you and if, that is tech first or finance, first and it resonates, with you you, are not shutting doors who are opening doors and just like, being, here at GSB opens, more doors for you just make sure that that's what you're doing because you're on a journey and your very very early, and so. I am, firmly of the view I wouldn't, have had this opportunity had, I not done my prior one and one, thing led to another so I'm not trying to skirt your answer but I really think it is more about the people and quality of what you're doing. Rather. Than should, it be tech or healthcare or something else unless you have this unbelievable. Like commitment, and dying passion for that should. We pay off student debt or invest, in retirement savings.
Wow. I. Get, rid of that student, debt. We. Do the rest later should. We have kids now or later. Yes. Should. We join a company or found a company oh man. You. Know I would, have been a horrible founder, of a company and I'm not so bad at a company, but there. Others who are just the opposite, again. Don't. Regret, anything I, remember early, on reading, Jeff Bezos no regrets point, which is when, he was looking to leave de sha hedge fund to, create this crazy idea this book seller I think, his parents said to him what are you doing that you know I don't know if he paid off his student loans at that point but, he said I don't want have regrets I'd rather try and fail and never try it all so I think at, the note you know the regrets analysis, is actually really good don't, ever regret something you've got plenty of time. Big. Data or bite-sized data I. Think. There's a lot of is phenomenal. That, we're we're living in like we haven't talked that much about AI and machine learning, but we are living in an extraordinary and, Minot's with some ice let's have one face no it's okay. We're. Living in an extraordinary time you know when I look at what AI, machine, learning and building, on data can do it's, not only the fun stuff like if you were using. One. Of our pixel phones and our photos, Google photos you, can take pictures and sort by person. By hug by whatever you want you can go to any country and translate, into any language but you. Also to me what's super exciting, is what's going on I've already mentioned it with healthcare you. Know as an example one. Of the most amazing, areas. It's what's going on with with, scans. And pathology, reports, reading reports, in, the, area of breast cancer, we just recently had this extraordinary, breakthrough. Where. The. Accuracy. Of diagnosing. Stages, of breast cancer, is. Meaningfully. Better with the tools of, machine learning and I you, know adds an example, I think it's in. One of. Four instances. When, doctors. Are reading, pathology. Reports. They. Over. A different. Periods, of time they changed, their diagnosis, of the staging, staging is, critical, because it tells you what kind of intervention, is needed how far along you are and what's. Also, extraordinary, is, the. Percentage. Of time they. Miss, early. Stages, of metastatic, cancer, is actually quite remarkable, from, our early research what, we're seeing is in almost. All cases, when. You're looking at pathology. Reports, biopsies. You, the, machine, learning is able to come up with what in our science, of early stage metastatic, cancer, why, is this so exciting because it's building on data in ways that. Is a tool, for doctors and what they're saying is this. Enables, them to focus on the tough stuff it enables, them to go deeper it enables them to know when to intervene.
At An early space. As a cancer. Survivor myself I look at this and I say it's, sort of akin to letting doctors, have. The, tools they need to be as effective as possible and spend time with patients the way they want so I get excited, about these things because I look at the ability to transform. Care. And I, look at what we have being. At Stanford or what I had being in New York it's amazing, not everyone, around the world lives in places as extraordinary, as this and so really to provide. That kind of access to quality, diagnosis. Amazing. One, more story I was with a doctor, recently and, I. Asked him about this and he said it's. Amazing, the ability with the, ability, to see what's going on in my patient's body on a continuous, basis, rather than just the 15 minutes or 30 minutes they're with me I am, that much better and so. I look at that and I say we're living in an, amazing. Time and to be able to leverage this the right way to. To, address, whether it's healthcare, or. You. Know deaths. On the road from cars one, thing after another it's pretty, extraordinary what we're able to do, you know I think we're, gonna look back on this and say wow it's how much more can we apply. Thank. You so much thank, you.