Promoting Community Among Investors

Any investor could tell you that theirs can be a lonely profession. Sitting in front of a computer making trades all day isn’t something that necessarily lends itself to building community.

Stocktwits, a social network and one of the world’s largest communities of individual investors and traders, wants to change that dynamic. It was founded on the premise of connecting investors to learn from each other, share ideas, and have fun. This is its story.

A Different Role

Rishi Khanna is the current CEO of StockTwits, but not its founder. Although he previously started two other companies called OneLevel and Novus, as a current non-founder CEO, his role at Stocktwits is somewhat different.

“I think the biggest foundational difference in having been a founder of my own startups is you do have a different level of agency as a founder CEO,” he says. “So you can make decisions in a different way than you can coming in from the outside. Three and a half years in, I’m pretty comfortable making decisions, but when I first started, there were certain things where I didn’t feel like I had the agency to necessarily change things or approach things. I had to make sure I was learning both from our team, but also from our community.”

In other words, as a non-founder CEO, it can take longer to build the necessary level of trust to really get things done. “I think that level of agency and the trust that comes with being a founder takes more time,” Rishi says.

At the same time, a company can benefit from a non-founder CEO in unique ways – in an ideal world.

“I think… coming in with a fresh perspective and fresh lens to the business, the role of the company, and the brand in its ecosystem… is a big benefit,” he says. Still, “That can go wrong. I’ve seen it obviously go wrong with many outside CEOs. But it can go right as well. And you don’t know the answer ahead of time. You only know it in hindsight.”

A Lonely Game

In a nutshell, the problem StockTwits wants to solve is that investing is often isolating.

“When you think about investing, it can very much be [an] individual kind of single-player game, a lonely kind of game,” Rishi says. “Maybe you’re just happy doing it on your own, but the markets, and I believe investing in general, is an apprenticeship game. Learning happens from others, and the markets are so dynamic. It’s not like what worked 40 years ago is going to work today, or what worked even two years ago in our current landscape is going to work today.” 

As a result, continuously learning from others can make you a better investor. “It might not be your immediate community,” he says. “It might not be your friends. You and I could be best friends and have completely different investing styles or trading styles. Stocktwits was one of the first places for the community to find their tribes, as I like to say, for investing and trading.”

Today, Stocktwits has some 7 million members and counting – up from 2-3 million when Rishi came on in 2020. He attributes this growth to several factors, including the Covid pandemic, during which “the only game in town was the markets.” He also says that under his watch, the company has focused on benefits to community members and done away with some tangential products that were mostly just a distraction.

What’s Next for Stocktwits

Today, StockTwits’ core product line consists of its community and its content around investing, such as a daily market wrap-up newsletter. The company’s newsletters are generally monetized through advertising.

Stocktwits also has a broker-dealer subsidiary. “We’re launching more and more asset classes that you can trade right on Stocktwits,” Rishi says.

In the second half of 2023, he also plans to launch what he calls its tools and data product line. “This is premium data… like our sentiment data and trending activity and things that investors and traders want access to at scale that we’ve traditionally never [given] them, as well as other tools and… alerting systems,” Rishi says. “The business model that we married to that product line is generally a subscription model.”

He says a subscription model will allow Stocktwits to deliver more value for the cost. “You can build a very healthy business that essentially from a business model perspective could theoretically subsume the other two business models,” he says. For example, premium subscribers could experience the platform ad free.

There could be other perks as well. “Maybe you also get… severe discounts or steep discounts on transactional fees and costs and stuff of other asset classes wherever there may be fees and costs,” he says. “For us… having a diversified revenue kind of strategy is important.”

Advice for Founders

Rishi says that among other things, founders should always know where their company stands when it comes to funding. 

“There’s too many founders that [I’ve] come across that [have] raised money because raising money was easy, and they weren’t paying attention to the numbers,” he says. “They weren’t understanding because, hey, they’re a product guy, they’re an engineer, whatever it might be. Know your numbers. It doesn’t mean you have to be the accountant or the bookkeeper, but you have to pay attention every day, every week, every month, [and] stay on top of that.”

Another piece of advice is to focus on small improvements. “The world generally isn’t a home-run world,” he says. “[So] we were like… How do we improve the community and make sure we’re doing the right things? Small wins equal big things. This is like compounding interest…. Focus on how you can break things down into small wins that’ll get you to your bigger picture, your bigger goal.”

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