// conversationS 

Investopedia.

A conversation with Daniel Siegel, CEO of Investopedia.

August 11th 2017 | New York City, NY

AUDIO

video

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David Siegel:
I've been in the digital media space since 1998, 1999, when I started working at Double Click. I was a relatively early employee over there. I've just always loved digital. I worked for 1-800-FLOWERS for about five years. I worked for Everyday Health, which is a big media publication for a few years, and I worked for Seeking Alpha as well. Just been in the media tech digital space for a while. 

Raad Ahmed:
Why did you decide on Investopedia? 

David Siegel: 
I absolutely love financial education. There's a major problem in the country around a lack of financial literacy. For example, there are 10,000 boomers who are retiring every single day, and they have no concept around oftentimes how to invest their money, how to save for retirement. The average retirement savings in the country is $55,000, which is terrifying. 

Raad Ahmed:
That's unreal. 

David Siegel: 
If I feel like Investopedia can have a bigger impact on helping to solve the financial literacy crisis and help people to learn more and save more and hopefully have better marriages because they're actually saving more, have better retirement times, then that for me is why I joined Investopedia. The other reason I joined Investopedia, I would say, is because of who owns it. We're owned IAC. IAC owns Tinder and Match and Home Advisor and Angie’s List and Vimeo and all these great companies. They basically said, hey, we want you to come over. We want you to run Investopedia, and we going to invest heavily behind it. They did, and it's been great growth so far. 

Raad Ahmed:
Can you talk a little bit about the growth of Investopedia? The reach you guys have on a monthly basis?  

David Siegel: 
27 million people a month. That's a big number. 

Raad Ahmed:
That’s amazing. Especially considering it’s for financial information.

David Siegel:
Right. We're only focused on finance and investing, and 27 million people a month, which essentially equates to about 50% are in the U.S. Interestingly, 50% are actually outside of the U.S. We have tons of people in Canada, UK, India, Hong Kong, all throughout Europe, etc. They're reading about Investopedia. Even though it's only in English, we still have a very huge following outside of the country. 

Raad Ahmed:
Is that because of content specific to those countries? Or it's they’re interested in US based financial information? 

David Siegel:
I think there's a general respect for the U.S. capital markets and U.S. financial systems. I don’t think that other countries have their “Investopedias”. We really are fairly well-respected across the world, so it isn't so much that we have the German definition of understanding what ETFs are or 401k equivalents. It's more, I think, just a general halo impact to our broader respect that people have. 

Raad Ahmed:
Our readers are early stage founders, people who have raised a seed round or Series A, and trying to break into the tech industry. You being who you are with years of experience working on internet companies since ‘90s, what advice would you give on founders looking to start and grow an Internet company? 

David Siegel:
I actually teach entrepreneurship at two universities. I teach entrepreneurship at Pace, and I also teach it also Columbia. It's definitely a passion of mine, entrepreneurship. The number one thing I would say for a founder, and perhaps this is a cliché, but it's all about who you surround yourself with. It's about finding people who are different than you, finding people with complimentary skill sets. Too many founders end up choosing a number two or a number three person who is similar to their personality. Founder is hyper aggressive and they like hyper aggressive people, and they're going to keep hiring those same types of hyper aggressive people. It's so much better for a founder to find complimentary skill sets. You're the type-A personality? Find the person who’s more thoughtful, who’s a little bit of a slower decision maker. You take more time? Find the type-A sales type personality. I would say that is priority number one, two, three, is surrounding yourself by complimentary skill sets. 

Raad Ahmed:
Right. Would you say the Zuckerbergs the Musks and other solof founders, are the outliers? You should go out there find a co founder? 

David Siegel:
I don't know if your number two or three necessarily has to be a cofounder. If you look at Zuckerberg and you look at Sheryl Sandberg, she compliments his skill set in a lot of very, very important ways. I don’t necessarily think that Facebook would be where it is if they didn't have the combination of those two. I don’t necessarily think it has to be a cofounder type relationship. It can be. You're the founder and you're hiring people on your team, and they would get, obviously, equity as part of that, but it doesn't necessarily have to be the pure cofounder type thing. 

Raad Ahmed:
Right, okay. How many employees does Investopedia currently have right now? 

David Siegel:
When I started about two and a half years ago, I was the 27th employee. We now have about 120. 

Raad Ahmed:
That's a lot of growth. 

David Siegel:
That's a lot of growth. It's less than two and a half years, actually, and we're now in our third office. We have a seven-and-a-half-year lease in this office, so if our building manager’s watching, don’t worry. We're going to be there for a while. Hopefully, we'll take over another floor at some point. Yeah, we've had over 4x the growth in the last two and a half years. 

Raad Ahmed:
What departments are the majority of your employees working in? 

David Siegel:
We went from having zero developers as employees at Investopedia who are actually doing coding, because development was offshored by the previous owners prior to IAC. We now have, I think, 45 developers in the company. Out of those 45 developers, 44 of them—we have one exceptional person here, 44 of them are actually in Edmonton, Canada. The reason for that is because Investopedia was actually founded by two hockey buddies in Edmonton and there was an office there. What I like to say, here we have to compete with Facebook and Google, etc. for great dev talent. In Edmonton, we are the Facebook and Google in Edmonton. We're competing with some old, stodgy, oftentimes oil companies. We're the sexiest thing out there. It's great to hire talent. 

Raad Ahmed:
Big fish, small pond, right? 

David Siegel:
Big fish, small pond. For sure. We have obviously a lot of developers. We have a 20-plus person editorial team. We have a 25-person sales team. It's been growth throughout, but I would say the biggest percentage growth was in developers. You've got to build great products, and obviously, developers help you to build great products. Project managers, project managers, product managers, etc.
 
Raad Ahmed:
How do you still keep that culture and that shared mission at a company that grew it’s headcount so fast? 

David Siegel:
It's one of the most important things you could do as a company, hands down. I always say that there's no difference between culture and leadership, meaning someone will be like, oh, this culture of this company sucks. You know what? The leaders of the company then suck, meaning if you don’t have the right leaders, you don’t have the right culture. Step number one in ensuring of a great culture is, you need the leaders in the company to exemplify that culture that you really stand for. We've actually codified the cultural attributes that are most important to our company. I could share it with you if you want. 

Raad Ahmed:
Yeah, please. That would be great. 

David Siegel:
We actually have scope bottles at everyone’s desk. The reason for it is, it stands for SCOPE, not because people have bad breath. Don’t worry. What it stands for is, S is for selflessness. We like to hire and promote people who are truly selfless in how they work. They don’t prioritize what their needs are. There's not an ego focus, but it's more about how do I help the team? That's S for selfless. C is for celebrating. Celebrates big wins, small wins, etc. There we go.
Here's one of our SCOPE bottles. 
 
Raad Ahmed:
That's genius. I love that. 

David Siegel:
Every employee has one at their desk, absolutely. C is for celebrating. Always for over communicating. When you get bigger, you can't just be a good communicator. You have to be an over communicator. If you're not sure, CC that person on that email. If you're not sure, set up that meeting to make sure that everyone understands exactly what's happening. You can't just manage through telling two or three people when you have 120. It's very different than when you had only 20 employees. P is for planning. That's important, because again, as you get bigger, you can't just operate by the seat of your pants and just make decisions quickly.

E is for empowering. That's about empowering employees. If they see something, then they should say something. If they disagree with me, they should walk into my office and tell me, I completely disagree. It's about empowering people to be the CEOs of their area and owning it. We use that for recruiting. We use that for reviews of employees. I think it really resonates, because it makes sure that the types of people who we continue to bring in, the types of leadership qualities that we look for, are people who are selfless, focused on celebrating, over communicating, planning oriented, and empowering of people.
 
Raad Ahmed:
Right. Is it ever too early for a company to set those values when they're starting out? Or would you say wait a little bit for them to figure it out? 

David Siegel:
I think it's like, when you have three employees, you don’t really need to codify. Like, okay, these are our cultural values, because it has to come up from the ground up and it has to really represent who you are. We frankly didn't codify our values until we were about 100 employees, because it had to represent who we are, rather than just some words on a screen. It had to be, when I talked about it with the team, they said, oh, my God. That's so us. There's not that's so us when there's only three or four people. What I would say is, entrepreneurs need to be cognizant of the types of leaders and employees that they bring in initially, because the initial people are going to have an outsized impact on the culture of the company without a doubt, and understand the types of attributes that they're looking for. High sense of urgency or high analytic focus, whatever it is. But you shouldn’t codify anything for quite some time. That's my take on it. But always be cognizant that every hire that you make in the beginning is going to have a significant impact on the culture of the company. 

Raad Ahmed:
Do you believe in hiring slow, firing fast?
 
David Siegel: 
Yeah. I'm not sure about the hire slow. You definitely have to fire fast. That, I agree with, because you can't, especially if you know someone’s not the right person, let them stay for too long. The hire slow, I would say that you don’t necessarily know who’s going to be a rock star. I've interviewed lots of people who I thought were going to be rock stars, and they weren't. I thought people who were going to be B-players and they ended up turning into rock stars. I may have been just a bad interviewer. I think you want to bring people in, especially in the beginning, that are athletes, that show an ability to do a whole of potentially different things, as opposed to just experts in one particular area. If you do that, then you'll find the right position, hopefully, for them in the organization over time, but I don’t think many startups have the luxury of necessarily just hiring slowly, especially if they just got a Series A or a Series B and they need to start spending money. If you're just in angel stage and there's no big hiring focus, then of course, you should be very diligent in who you bring in. 

Raad Ahmed:
That can be a good segue to my next question, which is, what is your advice for entrepreneurs dealing with failure and adversity? I can remember when I was first starting LawTrades and we were raising our first round of funding, I must have gotten rejected by at least 100 different investors. From each rejection, I took it as, all right, how can I improve from there? What are some data points that I can capture to improve my next pitch and so on and so forth? For a lot of folks out there, it's a very lonely, distressing path that they take. How do you deal with that yourself? But also, what's some advice you can give to entrepreneurs that are out there in dealing with failure and adversity? 

David Siegel:
Yeah. It sounds like, to some extent, you embraced it. It's very easy to say, embrace it! But you have to say, what is the goal of the initial meetings that I'm going to be having? If the expectation of trying to raise money in an initial meeting is that money’s just going to be coming and flowing left and right at you and people are just going to be falling in love with your concept the majority of the time, then you need to reset those expectations. It's very easy to say that failure is far more valuable than success, but it really is. The most important thing an entrepreneur can do is to say, I am going to embrace failure. I am going to fail 100 times, and from every single one of them, I'm going to figure out exactly what you did. What is the one thing that I did wrong? What's the one takeaway that I can make to just make my pitch deck better? To make my pitch better? To build a better relationship? Being introspective and being truly self-aware and not taking it personally that the failure means you're a failure, it's not a failure if you're learning something, and it's about changing the definition of failure. If you present it and they don’t end up deciding to invest behind you, but you learned something and you built a relationship with someone, that's hardly a failure. That's a success. You have to be looking at all those small win successes and not perceiving them as failures.

Raad Ahmed:
Right, and I guess that's where the passion comes from. You're not starting a startup for all the goodness of it. You're just like, what level of pain can I assess? Can I really partake to start this journey? 

David Siegel:
Absolutely. You have to be willing to go through a whole lot of obviously pain, but the goal is to make it non-painful in my personal opinion. It's to say, I am going to learn so much every single time. If you say the goal of a startup—Lean Startup is one of my favorite books. Lean Startup talks about how the goal of a startup is learning. Straight up. If the goal of a startup is learning, and you're meeting lots of people and you're going to be learning from all those conversations, then in the beginning, you are achieving your goals. That's not a failure. It's about setting the right expectations and setting the right goals. 

Raad Ahmed:
Nice. To shift gears back to operations, I read that you grew sales by over 300 percent. For all those sales startups that are out there, that are looking for clients, customers, enterprise level customers, what have you, what do you think contributed to that level of growth?
 
David Siegel:
Really, one thing stands out the most in why we grew sales so quickly. Too many entrepreneurs will think that it's all about hiring the best sales person and the second-best sales person and the third-best sales person. Then, what happens is, you don’t surround the sales people with the infrastructure that they oftentimes need to succeed. What we had when I joined was, let's say seven sales people, and two people helping to support them with creating decks, putting ad plans together, managing campaigns. What happened is, each sales person was actually spending 80% of his or her time not actually selling, but preparing for the sale, preparing the decks, managing campaigns afterwards, not actually out there. Oftentimes, and a lot of entrepreneurs don’t appreciate this, the success of sales is in the sales support teams that you surround sales with. You want sellers to be on the street. You want sellers to be spending as close to 100% of their time selling. When I started, we had too few employees to do that, so we had lots of sellers that weren't actually spending any time selling. They were doing decks. We probably have now, from seven, we now maybe have 11 sellers, but we have 10 to 15 people supporting those 11 sellers, versus seven and having two people supporting them. Now, the sellers are actually spending their time focused and really selling, and they have the expertise of people to support them. I know this sounds very rudimentary, and it's just an organizational structure thing, but it's extremely important, because the myth of the amazing sales person that's going to just completely change one’s life overnight is all wonderful, and maybe that happens, but it's not repeatable. It's very hard to repeat that. You want to build a system, and that's very, very important. The second thing is, I think that we brought in a great CRO. That obviously helped a lot leadership. Then, the third I would say is the products that we built. We're not just selling just display banners on our site, but we're building content solutions and big sponsorships and video experiences. We moved away from just boring, traditional display ads into a suite of different, better ad solutions. At the end of the day, I think the number one thing was the support that we provide our sellers.
 
Raad Ahmed:
Right

David Siegel:
I hope that wasn't too long. 

Raad Ahmed:
Not at all. 

David Siegel: 
I care about that one a lot. 

Raad Ahmed:
What is your big vision of Investopedia? What does it look like 10 years from now? 

David Siegel:
Ten years. That's a long time.
 
Raad Ahmed:
We like to think in decades here. 

David Siegel:
Oh, boy. Our mission is and who we are is, we're the world’s largest finance investing education site. That's never going to change. We help people make smarter investing and financial decisions. What are we doing over the next few years that we already started but that I think will actually be bigger than the business that we today? Right now, we're a free site. Anyone can come in and use us. Twenty-seven million people a month do. Wonderful. We actually just started something called Investopedia Academy. We started it just three months ago. We have three courses live. We have another two courses that are going to be live in the next couple of weeks. Things like fundamental analysis, Excel for finance, financial modeling, technical analysis. Those types of topics. 

Raad Ahmed:
And these are paid courses?

David Siegel:  
These are paid courses. The entire MOOC space, which stands for Massive Open Online Courses, is a $2.5 billion industry, going to about an $8 billion industry. Finance should be about 10% of that. It's an $800 million market out there around finance and investing related courses. For trading, for personal finance, etc. I believe that Investopedia Academy, in 10 years from now, will be bigger than the core Investopedia.com site that we have today. It exactly leverages what our expertise is, which is finance and investing education, just in a different way in that we have these amazing, robust videos and courses and certifications that people go through with testing throughout. Totally excited about it. We've already sold over 2,000 courses just in the first couple of months. It's going great. 

Raad Ahmed:
Do you think that will replace the MBA at one point?

David Siegel:
It's funny. We're doing a strategic planning meeting with the CEO of IAC literally tomorrow. Once a year we do a big strategy meeting. One of the things we'll be talking about is, get your Investopedia MBA, and potentially will align with the university. I envision a world where our users get an accredited MBA through Investopedia, and that would be really exciting.

Raad Ahmed:
That sounds amazing. We have a lot of younger people watching this right now.

David Siegel:
Hi, younger people.

Raad Ahmed:
What is one financial tip that you can give to this younger generation of folks to help them improve their personal finances?

David Siegel:
Can I give two, please?

Raad Ahmed:
All right. Two, two. Yes. 

David Siegel:
The two will be, number one is avoid credit card debt at all costs. Credit card debt hurts your credit, and it also, you pay very difficult interest rates on that debt. Avoid it at all costs. Do everything to avoid credit card debt. That's number one. Number two is, if you need to live at home, that's okay. A lot of people do. Max out your 401k, get that 401k match, start early. I started with my 401k when I was 22 years old. I'm not going to tell you how much it is right now, but it's a lot more than it was when I was 22. I've pretty much maxed my 401k amount, and I've got it matching every single year. The compounding is compoundulous [sic]. It's really phenomenal, and I guess the best thing you could do is really try to save money in your 401k and get the company matches, because it's just giving you free money. Who doesn't like free money? 

Raad Ahmed:
I love free money.

David Siegel:
There you go.

Raad Ahmed:
All right. We're going to end it off with one last question, which is a little open-ended and broad. What is your definition of success?

David Siegel:
Definition of success. I'm a family guy. I've got three kids and a great wife, so definition of success is a happy personal life, which for me means a great relationship between me and my wife, a great relationship between me and my children, as a family, and the ability to actually, with our time on this earth, truly help people. I'm not a doctor. I'm not a surgeon, but if we're able to help younger people, older people save for retirement, help people make smarter financial decisions, we really are helping people. That's a successful life.

//QUOTED

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"I've interviewed lots of people who I thought were going to be rock stars, and they weren't. I thought people who were going to be B-players and they ended up turning into rock stars."

-David Siegel, CEO Investopedia

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"We like to hire and promote people who are truly selfless in how they work. "

-David Siegel, CEO Investopedia

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// NEXT conversation 

August 8 2016 | NYC