ReD Community Talks: Cengiz Cemaloglu

How Ethnography Prepares You for Business School

Cengiz Cemaloglu is an MBA candidate at Stanford Graduate School of Business - where he is a BOLD Fellow, a Markowski-Leach Scholar, a Leadership for Society Scholar, and an investor on behalf of the Kudla Fund and the Stanford GSB Impact Fund. After receiving an AB in Social Anthropology and Government from Harvard College, Cengiz worked at Goldman Sachs’ multi-asset investing group, at ReD as a senior strategy consultant, and at Picus Capital as an investor in Seed/Series A ventures around the globe.

How did your work at ReD prepare you for business school at Stanford?

ReD has a really interesting way of approaching the world of business from the ground up. ReD is all about approaching things with a grain of salt when we hear buzz on the streets, or when we hear of trends, or when we hear people saying this is going to be big, or when we hear business decision-makers make decision A or B or C. So, I think ReD has that general intrinsic kind of skepticism and criticality when they approach any business problem, to ensure that they get to the core of the human drivers, the business drivers, and the on-layering and de-layering of the onion, to then really understand what is driving behavioral change, business decision-making, people’s preferences on the ground, and mental models. That kind of analytical, critical, there's-more-to-explore-than-what-the-eye-sees type of approach has been really essential.

I also really appreciate that ReD is focused on the non-economic, non-quantifiable kind of phenomena that exists in the world. A lot of the time business decision-making focuses so much on quantitative inputs, which are excellent, and one should learn them and one should base decisions on them. But it doesn't mean one should not take the qualitative or unmeasurable aspects that determine whether business will be successful or not. ReD is good at teaching you that good decision-making needs to take into account things that go beyond the quantifiable, measurable, observable and interpretable, and gives you that confidence to derive larger-scale theories, frameworks, or models that say this is a good business decision or product, because it taps into not only quantifiable metrics, but also non quantifiable things beyond that.

Another thing to highlight is that ReD has this globalist – almost cosmopolitan – view of how the world of business works. In a way, we approach any business that we help as a potential global entity - even though they only currently operate in market A, this doesn't mean that they may not one day operate in market Z. That globalist perspective and thinking, about what this might mean for the broader world rather than one particular sub-segment of society, is definitely another ReD asset.

The last one I will mention is that ReD has this structural analysis when considering the role of business in the world, embedded in any project that we do. Even when that's not the question maybe the business is interested in, we ask that to ourselves. As we go through that journey of discovering the business and their product market fit, we are always considering what the business is trying to do, what their role is in this day and age, and what their ideal role in the world should be. When I think those questions really come from that assumption that businesses serve a function and a purpose in the world, and businesses that don't serve a function and purpose in the world should not - and will not - be around in the short to medium term future. ReD makes you realize it is about considering: Does this business have a purpose and a function that it serves, that explains its existence and why would the world need it? And if it doesn't, how could it find it?

I imagine the participant observation and ethnography of ReD are vastly different from the skills you are using at business school. How do you think a humanities background or doing sociology on a daily basis helps you understand the business world? And has work that focused social worlds/cultures prepared you for business school, which has a reputation for being more quant-focused?

I think that as a trained anthropologist and ReD Associates alum, I approach everything as an anthropological phenomena, which means that with every mundane, seemingly boring question, I try to find the relevance-for-the-human and relevance-for-the-world angle that excites and intellectually intrigues me. Approaching any decision and any component of the decision as important, requires deep concentration, thought and focus, that ReD is always trying to cultivate. Build in some time in your schedule for slow discussion and debates, rather than jumping on conclusions left and right just because one data point said so.

I think it's also around this focus [of] putting people at the center. That's ReD’s motto and modus operandi. But I do feel that now, when I'm approaching business cases, whether that's financial or whether that's an investment decision or whether that's thinking about what a managerial decision-making process should be like. What is the impact of this on the world and in the people and the stakeholders of the company? And I think that whole stakeholder angle is so embedded in the way in which humanities and social science thinks.

And lastly, the critical lens. I think social sciences teach us that nothing in the world is as it seems to be – there are underlying factors and drivers that change behavior and the world. We must put our brain and energy into discovering these underlying factors, in order to understand why things are the way they are. That ‘why’ question is something that has motivated me in business school, even when I do quant analysis, which has been a really great tool.

What were some of your most memorable experiences - or teachable moments - working at ReD?

Wow, I have so many. I remember my first project. It was for a large IT consultancy, and we were trying to solve their attrition problem. I was only 22 and I was sent on this whirlwind trip to India and to Germany and to the U.S. I met some incredible respondents and had such a first-person view into their world and existence, and I remember feeling how incredibly exciting it was what I was doing. I felt that my work was serving a purpose, I felt that I had access to key decision makers who had been at top of their careers for a long time, I felt that I was being a real anthropologist. It’s a rare opportunity to be a real anthropologist, yet there I was meeting these people, getting to know them, trying to analyze what could make their lives better and then attempting to theorize and generalize from those observations - it really felt fulfilling.

I also remember the team that I was working with - we had so much fun when we were in Cary, NC or in India or in New York. I remember feeling very privileged that my colleagues were always intellectually engaging, witty, fun and full of energy and enthusiasm for life. I think another asset of ReD is that the people you're surrounded with are not conventional. They're always intriguing and make decisions that are true to themselves rather than following whatever trope. The casual conversations I would have with my colleagues was always so reflective and thoughtful, and of depth and substance. I definitely reminiscence about my time at ReD and hold many memories dearly in my heart.

How has ethnography made you a better listener or shaped your thinking beyond the classroom?

One phrase about ethnography that I really appreciate is that “it's a way of simplifying the complex and complicating the simple”. That is definitely the way it has enhanced my life in the classroom and outside of the classroom. When something seems simple, it's about diving deep and understanding the complicatedness of it. When something seems complicated and convoluted, it's about simplifying or generating a theory and explaining it through that theory. This anthropological thinking has influenced my approach to business and my approach to generating investment ideas, when thinking about where the world is going.

Secondarily, ethnography made me understand that people have mental models. It's not about what people say. The most important thing to uncover is people’s ways of thinking or modes of thinking. We’re all kind of wired machines; we in one way or another take inputs into our brains and make decisions through those inputs as a result, and we're extremely, incredibly sophisticated kinds of mechanisms. It’s about trying to figure out these mental models, what are these equations in our minds that we generate and push decisions out of? And how can we, in the best way possible, describe those mental models and the extrinsic impact on those mental models?

I think lastly, ethnography teaches us that we need to listen, always. We need to listen, we need to synthesize what we listen, but we also should not take in what we listen to at face value. We have to go one layer beyond, and I think that whole element has made me a conscious consumer of information in the world, that flows from individuals, that flows from enterprises, that flows from news media, and helps make conscious decisions about what I want to process and what I believe to be true.

What are the skillsets your cohort at Stanford needs to understand the future of the tech industry? Are you optimistic that the tech world understands its customer?

I do think there are two analyses needed that the world of tech but also the world of tech investing misses.

One is future-casting end states. I think about it in the following way: You're going to make an investment today in company X, or you're going to build a company X. You should be able to imagine, in ten years’ time, when that company X becomes a billion-dollar Unicorn and has real scalable impact to our day-to-day existence in the world, do we want that impact? Do we need that impact? Does the world become a better place because of impact or not?

We need to ask these questions today to then be able to imagine the subjunctive future, to see whether that's the type of world we as tech investors want to enable – or we as entrepreneurs want to build and be a part of. That’s definitely one analysis that I think Silicon Valley is missing right now, because of short-term, mid-term kind of incentives to just grow, scale, and grow, regardless of what you're going, which should not be the idea.

We need to concentrate our energy, our finite resources on this planet, and our time, on ideas that we need the most. And sometimes the ideas that get scaled fastest or get most capital allocated, are not the ideas that we need the most, and are not solving the problems that are most urgent. So, it’s about efficiently incentivizing through capital, in such a way that corporations or entrepreneurs prioritize ideas based on the urgency of the problem that they're trying to solve. We need to be able to allocate more and more capital to things like climate, food and agriculture systems, automation, and efficiency generation - things that actually free us up from existing tactile, difficult problems.

Two, is that Silicon Valley is very focused on user research. User research is inspired by ethnographic approaches, but ends up shallower, less robust, and siloed in major tech organizations. It is often not listened to by the product teams, that they're building at such urgency and pace, and software engineering teams, so we have to build these, and some firms are doing great job at that. We need to be building multi-modal thinking teams.  Managerial decision-makers need to ensure that they're taking qualitative and quantitative inputs at equal weight, that they're making contextual decisions, that they're listening to qualitative and quantitative advisors, and that they're building teams that are multimodal in their thinking and are able to synthesize qualitative and quantitative thinking into one. Because without understanding some of the non-market, non-measurable, non-quantifiable components of human behavior and existence on this planet, we won't be able to make the best decisions.

Silicon Valley thinking is becoming so globalized. Silicon Valley is exporting its way of thinking into the rest of the world and it's becoming a global mode of thinking. So, how do we influence that at the core, so that what’s spread is also spreading that message?