Compound Influence Podcast #1: Jim “The OG” Cramer

Brought to you by Tearsheet, Compound Influence is a new podcast that explores the power of influencers in the financial services industry.

The hosts, Zack Miller and Josh Liggett, discuss the rise of influencers and their impact on private investing and traditional financial services. They focus on the OG influencer, Jim Cramer, and his use of social media, particularly Twitter. They highlight the importance of finding the right platform for your business and going all-in on that strategy.

Josh and Zack also discuss the credibility and street cred that Jim Cramer brings to the table, as well as the importance of providing education and tools to your audience. They conclude by mentioning the Inverse Jim Cramer Twitter account and the academic research on the inverse strategy.

Takeaways

• Influencers have become powerful players in the financial services industry, particularly in private investing and traditional financial services.
• Finding the right platform and going all-in on that strategy is crucial for success as an influencer.
• Credibility and street cred are important factors in building influence, and having a background in the industry can enhance credibility.
• Providing education and tools to your audience can help establish trust and loyalty.
• The Inverse Jim Cramer Twitter account and the academic research on the inverse strategy highlight the impact and influence of Jim Cramer.

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Introduction to the Podcast Theme

Sup Zack, great to be back in the Tear Sheet studio. Been a while, but happy to be here.

I’ve missed you, man. I have not necessarily missed talking about Neo banking, but you know, Josh, when you and I were thinking about what next podcast we wanted to do, it became clear relatively quickly that we wanted to focus on influencers.

The Power of Influencers

Yeah, I think what’s really changed in the past couple years has been the power of influencers, especially with somebody being able to take a very strong profession or platform and turn that into a conglomerate, almost like a Mecca, of being able to do all sorts of different things. This is what’s been happening in the last couple years—a lot of influencers are now making their way in a very strong way into the financial world, specifically into the private markets and private investing. There have been the beginnings of influencers getting into traditional financial services, as well as financial service companies trying to figure out how they can yield more influence in the world at large.

That’s a great way to explain it. Part of what’s behind our intention in creating this podcast is to figure out how the mechanics work—how the influencers themselves have built their platforms, how they amplify messages, and how third parties who want to partner with them or build their own influence platforms can figure this stuff out by almost like case studies, right?

B2C Influencers and Traditional Marketing

Yeah, absolutely. It’s something that you have to be doing nowadays, especially if you’re talking about B2C. The power of influencers, especially when you’re talking about upstreaming, trying to onboard B2C clients when they’re born, or as close to that moment as possible. Marketing, Finance, yeah, having something like that now. Obviously traditional B2B, B2C relationships, which is the sort of the boys club that people like to talk about—that one-on-one, private time, Country Club, golf outings, whiskey tasting, cigar smoking—that’s not going away, and we all know that’s not going away. But there is something that’s happening with the world at large, trying to reach a wider audience and trying to get scale. A lot of that comes with a marketing campaign around influencers, or a platform or product that itself yields a ton of influence.

Personal Experience with Influencers

I have a great example, a personal example of the power of influence that I’ve witnessed firsthand in my life. We were interviewing the CEO of Current, a Neo bank that was working with Mr. Beast, obviously the most powerful, arguably, maybe definitely, the most powerful influencer. I mean, in terms of sheer volume, I think he turned down a $10 billion offer for his YouTube channels. People said that’s a low ball offer. His influence is so powerful. Current, this Neo bank, had a deal with him a few years ago, and he was helping to promote it. Now, I live overseas, and my son was 15 years old at the time. I was excited to tell him about this podcast because it mentioned Mr. Beast, and I know he was a fan of Mr. Beast. Just as I was about to tell him the story, I couldn’t even finish. He’s like, “Oh yeah, that’s Current, the Neo bank.” He had instant brand recall. A 15-year-old living overseas knew exactly the product because Mr. Beast had promoted it. He was wearing a hat with the logo on it. To me, that was wild—so powerful that it can reach people across the seas without any targeting. He knew, and he’ll know that company forever now.

It’s something that’s incredibly powerful, and that’s something that I think everyone has to at least have the pulse on or a strategy around—how they’re going to be working with influencers or tackling the potential to expand market share like that.

Focusing on Influencers in Financial Services

Exactly. This is a trend that both you and I see will continue to grow. When we thought about who to cover in the first episode, it became pretty clear. We’re going to start with the OG. Now I call him the original gangster. Who do you call him, Josh?

I call him the original guru. He’s like stock Guru, the original stock guru. That’s Jim Cramer, none other than Jim Cramer.

The Importance of Choosing the Right Platform

I think you should start. One of the things you mentioned was Twitter and how important that was to Jim Cramer. Can you say more about that?

It’s really important to find the platform that fits you. This is something very difficult. When I’ve done work with other companies or been working at companies themselves on social media, it’s not easy. Some people want to do LinkedIn and be very professional, but then you lose a lot of video content and social virality. Or, you might not want to do Instagram, but if you do, there could be repercussions. What matters most is figuring out which platform or platforms are best for the business and then going all in on that strategy. Jim Cramer did that with Twitter and has done an amazing job.

Jim Cramer’s Missed Opportunities

Now, I would say he’s missing a huge opportunity because short-form video content is where the world is going. He has 16,000 followers on TikTok but very little video content. “Mad Money” doesn’t even have a YouTube channel; it’s under the CNBC channel. In terms of shorts, the only ones with over a million views are like Tesla or SpaceX launches—very classic content.

Comparisons with Dave Ramsey

Dave Ramsey doesn’t have the Twitter followers Jim Cramer does, but he’s got 700,000 followers on YouTube and 1,600 videos. Some of his shorts have over a million views, including some with five million. Dave Ramsey built his influence originally on radio and now posts videos of his two-and-a-half-hour radio shows, cutting them into short forms. His short-form content is really well done with a beginning, middle, and end—something memorable.

Jim Cramer could benefit from this approach. He has “Mad Money” content and behind-the-scenes footage that people would love. He could hire an intern to manage this, maybe even through Upwork.

Extending the Brand

This brings up an interesting point, Josh. One of the things that made Jim Cramer so good initially was his focus. Now, you’re suggesting he adopt other platforms. Is that a lack of focus or extending the brand into other platforms?

You’d have to ask him. My guess is he’s happy where he is, like someone still using a Blackberry. He’s comfortable with Twitter and doesn’t want to deal with more video content. CNBC might not want to cut it up, and he’s fine with that. But it would be great to see more behind-the-scenes content.

Cramer’s Street Cred

Another takeaway is Jim Cramer’s street cred. He didn’t come from obscurity. He went to Harvard, was editor of the Harvard Crimson, then Goldman Sachs, and founded his own hedge fund, Cramer Berkowitz. This background is important in finance, where trust and camaraderie are crucial. He’s definitely an insider providing access to other insiders. This credibility is a big deal because many influencers today haven’t raised money or understand the responsibility involved.

The Changing Landscape of Influence

Jim Cramer might be the last of a generation of influencers who came up through traditional paths. Now, newer influencers can come out of nowhere. The danger is that many giving financial advice have never done the actual work. Jim Cramer’s experience and background give him credibility that newer influencers lack.

Timing and Audience Appeal

Jim Cramer launched “Mad Money” in 2008, a crucial time as the market was moving towards ETFs. He picked stocks, appealing to people who wanted to beat the system. This resonates with an American blue-collar credo of hard work leading to success. People want to feel they have inside information and can pick winners.

Educating the Audience

Jim Cramer educates his audience on how to pick stocks, even if it’s not the best strategy. He provides tools and insights, allowing people to start their educational process. They might end up disagreeing with his conclusions, but they’ll always respect the education he provided.

Cramer’s Lasting Influence

Jim Cramer treats his listeners and viewers as adults, giving them tools and philosophies to think like traders. He offers a portal into a trader’s life, saying it’s up to them to use the information wisely. This non-protectionist approach is appealing.

Inverse Jim Cramer

One interesting aspect is the “Inverse Jim Cramer” phenomenon. There’s a Twitter feed called Inverse Jim Cramer with 300,000 followers and even an ETF at one point. This shows his influence—people think doing the opposite of his advice might be profitable. It’s a testament to his impact.

Cramer’s Legacy

Jim Cramer has worked hard, building a hedge fund from $400,000 to $450 million. He then parlayed that into becoming an influential figure in finance. Today, he’s likely the most well-known financial influencer in the world.

Wrapping Up

That’s about it. It’s been great chatting with you, Josh. We could talk for hours about Jim Cramer. For those interested, there’s an Inverse Jim Cramer Twitter feed with about 300,000 followers and research indicating that doing the opposite of his advice might be better. It shows the level of his influence.

Jim Cramer has done an incredible job, from his hedge fund success to becoming a top financial influencer. Kudos to him. Looking forward to our next podcast topic.