Sallie Krawcheck, for years known as one of the most powerful women on Wall Street, is equally well-known for being very publicly let go from jobs that carried massive responsibilities--twice. In 2008, she was fired from her post as the CEO of Citibank's wealth management business, after advocating that some customers should be reimbursed for investments gone bad. She was restructured out of her next job, as the head of Merrill Lynch under Bank of America.

Krawcheck was widely expected to work at a hedge fund or perhaps go into the regulatory side of the business next, which explains some of the surprise around her 2013 purchase of 85 Broads (now called Ellevate Network), a networking group for women. Her next move as an entrepreneur was equally unexpected. Her new venture, Ellevest, will be a robo-adviser--a company that provides investment management via algorithm--tailored for women. Here, in this edited interview, Krawcheck talks with Inc. Editor-at-Large Kimberly Weisul about how Wall Street is failing women, why she is starting a robo-adviser, and, of course, office politics.

In banking, you weren't necessarily known as an advocate for women. What changed?

On Wall Street, I was doing it and living it, as opposed to broadcasting it. I always had diverse teams in place. I ran Citibank's women's group.

But then I realized it's just good business. One of the causes of the downturn on Wall Street is groupthink. I know thousands of people who held Citi stock from $53 a share to $1. Everyone I worked with really believed in what they were selling. How do you break that groupthink? You need difference. That's when I began to dig into the research.

Why start a robo-adviser just for women? There are plenty of other robo-advisers out there.

We spend 99 percent of our time talking about the gender pay gap. But the gender investing gap is a big deal.

Say that you're a woman who is 35 years old, you make $85,000 a year, and you're going to work for another 30 years. If you put 70 percent of your savings in the bank, you'll have $1.5 million by the time you retire. If you get raises at a man's level, you'll earn $1.1 million more. If you invest the money you would otherwise put in the bank, you can earn $2 million to $3 million more.

What that's telling us is not just that the robo-advisers aren't working for women, but traditional Wall Street isn't working for them either. Women aren't investing nearly as much as they should, and the retirement crisis is going to be huge.

What's preventing Wall Street from better serving women?

We've been asking the wrong question for the past 20 or 30 years. The question the industry continues to ask is, "How do we market to women?"

It's not how do we market to women, it's "How do we serve women?" There's an assumption the industry is doing exactly the right thing, if only the women would work harder. If only they would learn what a 12b-1 fee is. The industry is saying, "Invest like a man." Rather than saying, "Hold on, maybe, if we want women as clients, we need to change."

Did you realize this when you worked in wealth management on Wall Street?

I knew we were losing assets when the guys were dying. I would stand up on stage and say this much money went into the asset management group, and this is how much went out, and this is how much we lost because the client died. Did I connect it to, it's the wife who's moving the money somewhere else because we are not serving her well? Almost, but not quite.

Given that you were very publicly fired from big jobs twice, what have you learned about office politics that women need to know?

Carla Harris [now vice-chairman of Morgan Stanley] made a comment that will stay with me for the rest of my career. She said all the important decisions about your career will be made when you're not in the room.

The lesson from Bank of America, when I asked what I could have done better, was: "No one in that room was fighting for you, Sallie."

You need to form relationships. It's the network. It's keeping in contact with people. It's so people respect you. Not so that they like you, but that they believe that helping you will make them successful. It's giving, which we women are so good at.

Women sometimes are too reluctant to quit. We think, "If I could just communicate with my boss better." Well, no, he's a male chauvinist pig.

We hear a lot about how hard it is for women entrepreneurs to raise venture capital. But you got $10 million.

But not from traditional venture capitalists. Our lead investor is Morningstar [Mansueto Ventures, the corporate owner of Inc., is owned by Joe Mansueto, the founder of Morningstar].

Did you pitch the Silicon Valley venture capitalists?


Why not?

I went out to two firms as potential lead investors. Morningstar was important to me because they get the opportunity and they have so much intellectual capital. They do better thinking about individual investors than anyone.

As an entrepreneur, what type of leader do you think you are? 

Empowering, certainly. Collegial, collaborative, and then decisive. I'm very aware of making sure everybody has a voice, even the people who don't like to talk. I don't believe my idea is the best idea.

I am much less of a bitch than you think I am.