Building a 7 Million User Community: Stocktwits CEO, Rishi Khanna

Summary of Episode

#68. Rishi Khanna, CEO of Stocktwits, joins the podcast to discuss the trials and triumphs of user-generated communities. They discuss the recent Reddit API turmoil, how Rishi’s role as CEO helped facilitate Stocktwits’ growth to over 7 million users, and the secret behind building an activated user community you can monetize.

About the Guest: 

Rishi Khanna is the CEO of Stocktwits. Rishi is a seasoned entrepreneur, having founded and led multiple startups such as OneLevel and Novus before joining Stocktwits. His experience and expertise in the startup world have brought immense value to Stocktwits, which has grown exponentially under his leadership.

Podcast Episode Notes

[00:04:58] Outsiders with fresh perspectives benefit older companies, but it may go wrong.

[00:09:03] Starting a niche platform on top of Twitter was common in 2010, but ownership is necessary once it reaches a certain scale, as Twitter demonstrated with its API in 2010 and again ten years later. 

[00:11:57] Reddit’s API change controversy and an argument for prioritizing profitability once a company reaches a certain size.

[00:16:24] The community size depends on its goal, smaller communities are better suited to niche groups. 

[00:23:23] Improving the onboarding experience for different types of users and understanding how to provide value are important for growth. 

[00:26:14] Need to differentiate beginner and pro modes for creators, focusing on a mobile app for beginner mode, and desktop for advanced users.

[00:30:59] What is Pavillion?

[00:36:45] Communities can monetize through subscriptions and transactions. 

[00:39:06] Stocktwits has three key product lines, including community and content, media models, and subscription models for premium data and tools. 

[00:43:14] Starting with finding 100 paying fans is a milestone, but not the only one. Milestone numbers vary by business. The nature of the product will determine the milestones.

[00:47:52] New asset classes coming soon to Stocktwits, focusing on community and social features to enhance value for all users.

Full Interview Transcript

Ethan Peyton: Hey everybody and welcome to the Startups Avant podcast. I'm your host Ethan and this is a show about the stories, challenges, and triumphs of fast-scaling startups and the founders who run them. Our guest on the show today is Rishi Khanna, CEO of StockTwits. Now, this episode is going to be a little different from our normal conversations because Rishi is not the founder of StockTwits. 

Rishi came on as CEO in 2020, a mere 12 years after the company was founded. And interestingly, StockTwits has not had a founder CEO since 2016. Quick background on StockTwits. They are a social network and community of investors and traders founded in 2008 by Howard Linsen and Sorin Macbeth. As of this recording, their platform has almost 7 million members. That's a lot. And they were the original inventors of the cash tag, which has been copied many times over and is just a pretty cool thing. And I'll let Rishi give us a little bit more detail on StockTwits here in a moment. 

But for the man himself, I said he's not the founder of this company, but that doesn't mean he's not a founder. In fact, he's a two-time founder, and those companies are OneLevel and Novus. Before we jump in, a quick reminder to subscribe to the show if you haven't already. Just press the big old follow button, and you'll be doing your part to help us grow the show. All right, that's enough for me. Let's get this thing started. Rishi, welcome to the show. Super happy to have you here.

Rishi Khanna: Thanks for having me, I'm excited to join.

Ethan Peyton: All right, let's start at the beginning. Can you tell us what is StockTwits?

Rishi Khanna: Yeah, so StockTwits at its core is one of the largest communities of individual investors and traders across the world, primarily US-centric, but founded about 14 years ago around the premise of connecting to learn from each other, share ideas, and have fun and hopefully profit along the journey.

Ethan Peyton: Profit is important. Everybody wants to do it. So then maybe that's the answer to this question, but let me just assume it's not. What is the problem that StockTwits is solving?

Rishi Khanna: Well, I mean, I think when you think about investing, it can very much be a, you know, individual kind of single-player game, a lonely kind of game, or, you know, maybe you're just happy kind of doing it on your own, but, you know, the markets, and I believe investing, in general, is an apprenticeship game and, you know, learning happens from others and the markets are so dynamic. It's not like, you know, what worked, you know. 40 years ago is going to work today or what worked even two years ago in our current landscape is going to work today. The opportunity to connect like-minded people and find and discover like-minded people, because it may not be your immediate community. 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 in trading.

Ethan Peyton: So we're gonna get a bunch into community here in a little bit.

Rishi Khanna: Yep.

Ethan Peyton: And I'm really excited to do that because it's such an important thing and I don't think it's something that we really talked a ton about on the show. But before we do that, I wanna talk about your role as CEO. And as I mentioned in the intro, you're not the founder of this company and you came on as CEO in 2020. So you've got a little bit of a different perspective into this company than a lot of founders do as CEOs of their own companies.

Rishi Khanna: Yep.

Ethan Peyton: So from that angle of the CEO, what's the difference between the role of a founder CEO versus the role of a non-founder CEO?

Rishi Khanna: Yeah, that's a great question. I think the stage and the circumstances, of course, matter. But I think the biggest foundational difference in having been a founder of my own startups and stuff is you do have a different level of agency as a founder CEO. So you can make decisions, I think, in a different way than you can as coming in from the outside. Now, 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, and I had to make sure I was learning both from our team, but also from our community, being a community website, right, and a social platform. So I think that level of agency and the trust that comes with being a founder takes more time, that and build up to that. So I think that's that would be I would say is like one of the bigger differences.

Ethan Peyton: So then looking at that same thought from the other side, from the side of the company, what's the difference for the company when it's run by a non-founder CEO?

Rishi Khanna: Well, again, I think there's phases in it, right? So I think one of the benefits, especially for a company that has been around for a little bit, and it's not just, it's one thing to be a six-month-old company versus being a 12-year-old company, right? I think having that outside lens and coming in with a fresh perspective and fresh lens to the business, the role of the company and the brand in its ecosystem, whatever that might be, bringing that to the table, I think is a big benefit to it. And listen, 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. And Monday morning quarterbacking is very easy to do. But I think bringing a fresh perspective and kind of an outsider's view lens and hopefully coming with experience brings I think much needed. refreshing to strategies to product to you know just how a business operates.

Ethan Peyton: Do you ever run into any situations where an investor might say, well, you're not the founder of this business? I guess maybe they wouldn't necessarily say, well, you're not the founder, therefore you can't do it. But they may have a different opinion on the investability of the company or the value of the company based on the fact that there is not a founder or a co-founder in that…

Rishi Khanna: Yeah.

Ethan Peyton: …CEO role. Have you ever run into that?

Rishi Khanna: So not with our existing investors. I mean, our investors, you know, terrific. And I'm not the first outside CEO for Stockwoods, but a couple years back, I believe, when I was just talking to investors and folks were approaching us to potentially invest and whatnot, I do remember speaking with one investor and while they love the profile and the business and whatnot, they're like, the thing is we generally don't invest in companies that are not founder-led or at least have the founders on the exec team. So it doesn't need to be CEO, but... So I did come into that exact issue and scenario, but it's been rare. It's not, at least no one else has vocalized it, so I guess is the better way to put it. Like there was that one firm that just was very upfront about it, and I'm like, okay, great, totally understand.

Ethan Peyton: Well, it sounds like it was kind of a non-issue because you had lots of other investors who were interested and obviously some that were interested enough to invest…

Rishi Khanna: Yeah.

Ethan Peyton: …anyway, so cool. No need to solve a problem that isn't a real problem. All right then. So then let's talk about something from the early days of StockTwits. There's something that I think they did, that the founders did that I think was really smart. They essentially used the success of Twitter, both in the tech of Twitter and in their user base, to bring people to their own separate platforms. 

Rishi Khanna: Yeah.

Ethan Peyton: And so there's really two things I see going on there. They leveraged another platform to build their base.

Rishi Khanna: Yep.

Ethan Peyton: They took the success of someone else and used it to their advantage. But then the second thing is that they secured that base by creating their own ecosystem and getting users into that ecosystem. And obviously, those things, they can both work, but they definitely work better together. You know, when you have a large base of users and you've got somewhere to put them because there's a lot of danger of staying on someone else's platform.

Rishi Khanna: Yes.

Ethan Peyton: I know, you know, in the corners of the internet that I hang out in, everybody talks about, you know, Facebook groups is not the best place to have your community, and Facebook's gonna get picked on twice here. But you know, there was a change several years ago of like businesses on Facebook, they just changed the algorithm to where businesses really weren't getting seen anymore.

Rishi Khanna: Yeah.

Ethan Peyton: And so they always talk about building your own platform or taking people to an email list or something like that. I mean, so with those two things being done, I mean, do you look at this kind of the same way that I do, or do you see something different? And with that, is there anything that you would have done differently had you been CEO at the time?

Rishi Khanna: Yeah, so having been an early Twitter user, I mean I was on Twitter I think back in ‘07 and I took StockTwits in 2010 as a user. I think this was actually pretty common back then if you recall where a lot of platforms and apps or websites were jumpstarted on top of Twitter, on top of Facebook. Those were the two primary ones. And that's a great way, especially if you're looking at it, I look at those networks as being horizontal networks, right? They're serving everybody in every which way, like Reddit does, like a Discord does, like Twitter does, like Facebook does.So they're serving everybody. 

But when you're looking to verticalize and find a niche that you wanna address and give more tools to, starting on top and using that to solve the cold start problem in a network or in a user-generated content platform is a very smart idea and many companies did it successfully back then. But to your exact point, once you reach a certain scale, you need to have ownership over it. People are discovering... We actually went through this with Twitter, if you recall. I want to say it was back in 2010, 11, where they actually had a famous memo written by one of their engineers, essentially killing their API in a way, where a lot of companies that were built on top of Twitter's API... were essentially shut down now. I mean, 10 years later, we're doing this again at Twitter. And so, yeah, StockTwits was smart at the time to move over to, so initially, jump-started, cold start problem off of from Twitter, but then by 2010 moved off onto our own platform. And so today it's all of our own content for the last 10, 12 years. Though people still think, I do get plenty of questions like, oh, so you guys are on top of Twitter. We're like, no, it's actually our own.

Ethan Peyton: Hehehe.

Rishi Khanna: So I think that you know, I think for that five, six-year period. And then Facebook came down on it as well, kind of hard. I want to say like maybe 2016, 17, somewhere around there. But I would not have done it any differently. I think that was a tremendous decision because it is really hard to build community.

Ethan Peyton: Yeah, it really is. And you mentioned specifically that cold start problem, which is something I hope that we can address here in a little bit. But as we're seeing, there's a lot of this going on with Reddit right now…

Rishi Khanna: Yep.

Ethan Peyton: …with the change of the API. And they are seeing the users who are the ones creating the value for the product itself kind of revolt at this potential change of an API. And so it seems like there's just a lot of levers that can be pulled and a lot of risk in seemingly both directions at this point.

Rishi Khanna: Yeah, once you're at this kind of scale that the Reddits of the world are at, listen, they're not wrong. They have to run a business. And the age of being able to never be profitable is over. And we touched upon that a little bit ago. But I really do think, and I'm more of a value fundamental kind of builder business up from the kind of union economics kind of guy, which has not been a thing in the last 15 years, because…

Ethan Peyton: Hehehehe

Rishi Khanna: …you have to ask the question, like, “Hey, okay, when is scale scale that you keep telling us you're going to be profitable at scale?” How big did Uber need to be before it could expect profits from it and a real business model from it, right?

Ethan Peyton: Right, right.

Rishi Khanna: How big does Reddit need to be? Is it not big enough? I think it's pretty darn big. They should be able to be profitable. And so you do have to understand that. If you're getting all these services and tools as a user from something, there's got to be something that gives back. And maybe they can do it on advertising alone. I think that's very difficult. I think communication and maybe the approach of the how it was done could have been a little bit better, but the general premise of what they're doing is not unreasonable. You know what? You're welcome to go try to start your own startup and build something of value there.

Ethan Peyton: Maybe everyone should go start a startup.

Rishi Khanna: Well...

Ethan Peyton: Stop listening to this, go start a startup. But actually don't stop listening to this. Listen to the whole thing,

Rishi Khanna: Yeah.

Ethan Peyton: …then go do it.

Rishi Khanna: There you go.

Ethan Peyton: All right, let's jump into the good stuff. I wanna talk about community, I wanna talk about network effects.

Rishi Khanna: Yep.

Ethan Peyton: Now the word community itself is really kind of seeing a new life. And I think that this kind of new life may have gotten started around the 2021 time when NFTs were super popular and... And it was, what am I getting besides this pixelated picture of an ape? Well, you get to be part of the community. And a lot of these NFT communities really kind of became like country clubs in that…

Rishi Khanna: Yeah.

Ethan Peyton: …they, some of the assets you had to own to be involved with them were like crazy expensive in dollars, obviously. But so with the word community, obviously is seeing a new life. And now there's an older term that I haven't heard as much in the past few years. And that term is network effect, which is essentially when a product or service, gains more value by the number of users being on it. So like a Facebook where it's only you and your mom really isn't that valuable. But since everybody's on it, people like to hang out there. So with all that being said, how do you define community?

Rishi Khanna: You know, it is a vast term, but, you know, ultimately it is, you know, there is some like-mindedness or like, goals, I guess, right? That come out of it. But you know, at the end of the day, you know, humans, we are tribal primates and we do want to connect. Generally speaking, most humans do want to connect and they want to connect over the things that are interesting, fun, important to them. But that's a lot of different things for a lot of different people. 

So I think the communities, tribes, I use the term tribes a lot, are these groups of people coming around and gathering around some shared interest or goal ultimately. Whether it's the NFT lifestyle community stuff that we saw pop up or professional networks. I spent early in my career, I was also in a company called Gerson-Lambert Group, which is one of the largest expert networks in the world. So I've been in and around networks most of my career and communities are a foundational part of that.

Ethan Peyton: Is there, so we're gonna talk about community size here in a second. And do you think that there is a proper number that a community should be before it gains that value? And on the other side of that, do you think that there is a situation where things become too large, that things either need to be filtered down or focused down?

Rishi Khanna: Yep.

Ethan Peyton: …before it starts to lose that value.

Rishi Khanna: Great question. I think this goes back to what I was just saying is the important element there to understand is what is the goal of this community? Meaning, hey, if you want to discover all the best food in the world and stuff, right? I've previously consulted with and friends with the founders of Food52, a big social network essentially for food and recipes. If you want to be able to find the best recipes or fun stuff, you want that community to be as large as possible, right? You want as many people coming in.

But If you're looking for a very goal-oriented, let's say professional network, let's say hey, you wanted to really up your level on podcasting, I mean you're at the top of the podcasting game, but let's say you wanted to level up so we all could keep leveling up, it's probably more valuable to you to be in a small community of other podcasts and whatnot that have similar reach and scale and interests to share ideas and there, you being in a network of 10,000 podcasters is probably not useful to you. Being in a network of 25 high-quality ones is much more valuable to you. So I do think the goal and the, what is the interest or what is the goal of this matters and impacts like weather, kind of the impact of size. 

So if anything, I'd say goal orientation versus interest orientation is probably somehow correlated to a good size where goal-oriented stuff is probably, tends to be better at smaller sizes versus interest-oriented stuff tends to be larger sizes.

Ethan Peyton: I think that's a super solid answer. Do you think that there's, and maybe you just gave the answer to this question, do you think that there's kind of a formula that could be come up with for, for companies out there that run communities, whether the community be the business or whether the community just be a part of the business, do

Rishi Khanna: Yeah.

Ethan Peyton: …you think that there's some sort of formula that they can follow to kind of right size their community for the members?

Rishi Khanna: Yeah, so I don't have a formula as much as I love algebra and whatnot.

Ethan Peyton: Oh, you don't have one of these written down just in your back pocket?

Rishi Khanna: But we can go with the K coefficient and things like that. I will say I think when I talk about a lot in StockTwits is liquidity in conversation. So for StockTwits specifically and our space. how liquid are the conversations around companies and tickers and stuff? Right? And I think, so this goes to that, what is the goal of the community? What is the end? And what does it take to make sure that community feels alive and connected? I think you have to figure out what is the right liquidity level for that community. 

So again, I'll contrast interests and professional goals. So if you're in a CEO network, the level of liquid conversations doesn't have to be every day, right? You don't need a conversation every two minutes. That's probably really bad for your job as a CEO. But you want to be able to have availability and presence there. If you actually have part of a CEO network and one of our friends hit a wall with an investor issue and it was kind of becoming a timely matter, put it in our Slack group and shared it. And there were people there. ready to kind of respond where he wasn't waiting like seven days for a response, right? But versus on StockTwits, hey, if you have to wait seven days for the next post on something, that's not a particularly interesting platform and community to be a part of, especially when markets move in real-time. 

Ethan Peyton: Right.

Rishi Khanna: So I think the real-time-ness nature of what the results of the community drive, the liquidity nature, and that's, I think, how you think about... you know, are you at that right number? Does it feel alive for the goals that you need to reach within that community?

Ethan Peyton: And that makes sense. I'm part of a couple of different online communities for obviously different things, but it seems like what they've kind of figured out is that you can have the one large community and then you can gather people together based on commonalities into smaller subgroups, which are much more focused obviously on whatever they're based on. So it seems like there's a lot of different ways to solve this problem. So then let's talk specifically about StockTwits. When you came on, there were about three million users. And in your tenure, is that close?

Rishi Khanna: About two, yeah.

Ethan Peyton: Okay,

Rishi Khanna: Between two and three probably.

Ethan Peyton: All right. Gotcha. So when you came on to StockTwits, there were about two million users somewhere around there. But in your time, in this position, that number has gone up to almost seven million. That's a... It's a pretty big increase. What changes did you make that fueled this growth spurt?

Rishi Khanna: Well, two parts to that answer. One is, and I think not enough people will attribute things to this, but. Listen, we were fortunate and got lucky with timing with the tailwinds of the rise of retail during COVID, right? And the only game in town was the markets. And so we benefited tremendously from that. Now, you have to put yourself in a position to be able to benefit. 

So, when I joined, I think one of the things I did specifically for StockTwits is we were working on some other products that weren't necessarily part of the core of StockTwits. And just as a result of the times and whatnot, I really took our focus down back to the core and addressing the issues of the community. And we still, you know, we're always working on improving. We have a lot of great stuff that we're still working on to improve and make it better and better for the community every day. 

But we really, you know, essentially took 100% of our attention on improving the experience for the existing community, which then benefits, you know, the rest of, you know, when new members join and new people join, it's an improved experience for them. And at the end of the day, your community is the lifeblood if you are a social platform, right? Going to that Reddit comment and whatnot as well. So we really just focused for those first 12 months when I joined, like between, you know, for 2020, we were really, and even Q1 2021, because that was the craziest point in time, right? If you remember, Meme-Mania and... That's, I think, what it was. 

We were just focused on making it a little bit better every day for the community, improving things, whether it was little bugs or fixes or just minor UX changes to make things a little bit simpler, a little bit more understandable. And focusing on that allowed us to be in the right place at the right time with the massively increased interest in retail investing.

Ethan Peyton: So I think you kind of moved directly into my next question and that was essentially how you're creating an environment that activates users so that they stay engaged. And it sounds like what you're saying is just create a user experience that is enjoyable, that is simple, that is great. Do you have any other answers to that question?

Rishi Khanna: Yeah, I mean, those are of course, you know, things that hopefully every product you want to make enjoyable, you know, whether it's an enterprise B2B software or consumer. I will say, I think we have a lot of work to do on the Stocktooth's front to make it easier and more enjoyable for new users, right? I mean, our existing users, we have users on the platform that have been on for 10 years. years, right? And they understand it. In fact, they're the ones that are going to be the challenge. So if we make a change, right, like no user likes change, generally speaking. 

So making a change that is for the betterment of the new user actually becomes a bit of a challenge. But I do think, you know... that onboarding experience and how do you, what is your North Star in terms of understanding when a user begins to get value out of something, right? Whatever the product may be. 

And so in our case, like, hey, what do we think a user needs to go through to have the chance to recognize the value they can get from being a part of the Stocktwits community? And there are different classes of users and different types of users. So in kind of standard old school, like Web 2.0, early days, Social Parliance, It's the 1-9-9-D model, right? 1% of your users are the creators, 9% are your contributors, and then 90% are just consumers, right? Lurkers and stuff. 

And so when you think about those experiences and how do you get to that time to value, so to say, you gotta think about it from, hey, is this user trying to be a creator, right? Do they wanna be somebody that's out there posting, sharing their ideas? They are gonna want... one kind of experience back versus if you're just a pure consumer, you just want to sit there and learn. You're not going to be like writing posts, replying to people. You just want to take it all in. That's a very different type. 

So how you understand your users and who you're trying to get on and then how to find time to value for them and hopefully you understand what value is. That does change over time and at scale and different things. That I think is a really important part and something we actually talk about literally, every week now because we're like, okay, once you're at seven million, how do you get to 70 million, right? What's that next leg and how do you take that challenge on? And this is a big part of it about understanding, hey, what's that initial experience like and going from there.

Ethan Peyton: So do you have algorithms in place that kind of identify when a user has maybe moved from one type of user to another or do you have more manual systems where like I think LinkedIn has like creator mode and all these other platforms have where you can turn on and off like creator mode or influencer mode or whatever. Do you have certain systems in place that identify that for the user or do you allow the user to identify that for themselves?

Rishi Khanna: We know you know again one of the areas that we need to do work on from a product roadmap perspective is We don't have tremendously different experiences for you know what we would call creators today, right? And so that is one area we talk a lot about and I've you know I've been in product for 20 plus years and I am a subscriber to the belief, especially in consumer, but I think this applies to most products that are, especially network effect products and products that go to scale, is you really want to focus on having beginner mode and pro mode.

Ethan Peyton: Okay.

Rishi Khanna: Everything in the middle, you can kind of let go until you're like Facebook scale, right? You're optimizing or like very large scale where you're not like, you know, optimizing every little piece in between. But in the early days and even, you know, even that bar scale right now, like we're big, but we're not like huge by any means, is pro mode and beginner mode, right? And these are very different experiences. And so we don't have a very differentiated pro mode. And I think that's something that we, again, talk a bunch about is like, what does that look like? 

We can identify the pros, right? We have the algorithms and our data and tracking, like, hey, who are the creators? Who are the people that would benefit from pro mode or would be interested in that? And then, you know, a different experience for the kind of consumer and the beginner consumer. I think the other thing I'll add to that has been something I've been thinking about recently. So there's a lot of much better product people out there in the world than I am. But so if you feel free to yell at me or give me a call and help me out if you disagree with my answer. But I think the rise of mobile, mobile apps is really actually for a consumer platform like StockTwits, I actually think like, hey, the mobile apps are generally the kind of the beginner mode or the kind of simple to use mode…

Ethan Peyton: Mm-hmm.

Rishi Khanna: …because especially in the world of markets where there's so much data and charts and stuff like that, pro mode is actually much more analogous to kind of desktop mode. And so we have that luxury. I think that applies to a lot of products where you're creating content or dealing with vast amounts of... content or data in some way. And so that's where I've been thinking a lot more. And I was just having this conversation last week with our product team where I was saying, hey, we want to think about pro mode versus simple mode or beginner mode. And let's really think about it as iOS app versus desktop web. And I think for us, that's probably a pretty good barometer that we have all the data and the instrumentation behind the scenes to understand users. That, you know, if we kind of go back to basics, I think for us, like that's also another way I look at it.

Ethan Peyton: Yeah, you're not going to get an argument for me on that. And I think, just like what you were saying earlier, it comes down to goals. You know…

Rishi Khanna: Yeah.

Ethan Peyton: …if I'm that beginner user, maybe I am the lurker.

Rishi Khanna: Yep.

Ethan Peyton: Maybe I am the person who's just looking to consume information or entertainment or whatever from this platform. And for that, maybe I'm kicking back in the easy chair and just scrolling on my phone.

Rishi Khanna: Yeah.

Ethan Peyton: And that's the best situation. But actually, based on a conversation I was having, I think, yesterday… There's this, I have no idea what platform it is, but they essentially force everybody into mobile and there are things that you can only do on mobile even if you are a creator on that platform. 

Rishi Khanna: Yeah.

Ethan Peyton: And that just feels like a miss to me because just like what you said, as a creator, when I'm at work, I'm not scrolling on my phone. I don't wanna do my job on my phone. I'd like a 15-inch screen with an actual keyboard as opposed to you know, a six-inch screen in my thumbs.

Rishi Khanna: Right, yeah.

Ethan Peyton: So yeah, I mean, I think you hit it, you know, nail on the head with that desktop versus mobile situation.

Rishi Khanna: Yeah, and you know, I think especially in creator land, I think it's important. I agree. Like if you, you know, whatever company that is, they should probably think about opening their mobile web game.

Ethan Peyton: So then let's pivot a little bit from StockTwits to another company that you've got some involvement with and that's Pavilion. And this company is, well, I'll let you explain kind of what Pavilion is, but the question that I would like to ask you after you kind of give an overview of what it is what's your strategy, and what is the, I guess what is a good strategy to build a community from zero? As opposed to coming in and either leveraging from another company like a Twitter like we said or coming into a company that's already got several million active users.

Rishi Khanna: Yeah, so Pavilion, awesome company founded by a very close friend and former colleague from my GLG days, actually Sam Jacobs, the founder/CEO, who's built a great platform. It's essentially a professional community with its real goal of helping individuals level up from, you know, in their careers as individuals and not as a part of like... a corporate agenda per se, right? 

And so how do you build community and give tools to individuals to, you know, succeed in their careers, both from a personal enjoyment factor, as well as from all of our standard kind of career metrics of titles and the comp and all that fun stuff. 

The story behind Pavilion is a terrific one about how organically communities can form and then you can identify these opportunities. That really started as Sam getting a bunch of folks together around dinners. All of us were founders or running sales operations within our organizations or we were an enterprise like sale kind of company. My last company I started, Novus Enterprise SaaS platform, selling to institutions. investors. And so, you know, I had taken over the sales team to, you know, kind of as one of the many hats I wore during kind of the time there. 

And we started getting this, you know, together, eight of us or so for dinners and, you know, just kind of sharing everything from, hey, how do we create like sales comp plans, right, commission plans and stuff like that to, hey, how should we think about pricing or how should we think about go to market? And organically out of those dinners, more and more people wanted to be invited, and Sam was spearheading this. And then companies, people that were there as individuals, they're like, hey, my company would love to sponsor this dinner because maybe they're a MarTech tool or a sales tool or something like that. 

And from there, Sam identified, hey, there's really a need that folks had as individuals from a professional development and network perspective. And in this case, it was focused around the sales exec is where it started. Today it is still very much like some of the top sales leaders in there, but it's also, we have CEOs, we have a junior, there's a few kind of junior pods and stuff though. The main focus is at the executive level. 

And so I think when you find that common goal, going back to what we were talking about earlier, he found that common goal that we all had of wanting to learn and just be better in our jobs, to further our companies, and to further our individual accomplishments and careers, whatever it might be. And okay, how do we formalize this? What are the things we need? 

And Sam's one of those people that drives a lot of joy around delivering value to individuals and helping others and for him and his personal journey, which he writes a ton about on LinkedIn and you should go read his LinkedIn post. I mean, I think he does a tremendous job being transparent, as transparent as we can be kind of on platforms like that. He drives a lot of joy in delivering value to us in the community. He found that wait, I'm going to be really happy helping people. How do I make this a business? How can I not have to have a different job and just doing this in the evenings on the side? Very organically, I just started with eight people around having dinner in restaurants in New York City. From there, he's turned it into a 10,000-plus-subscriber executive platform.

Ethan Peyton: That's pretty amazing just to hear those numbers off of what started as eight-person dinners. Now I'm seeing something kind of interesting here in that community feels like it started with a group of experts and it built out into a community that is maybe built of experts for other experts. 

And I'm sure that there are people that are in that community that would not consider themselves to be. you know, quote-unquote experts. And I'm using that, that term, you know, if you're, if you're grouping people from expert to non-expert, you know, only, only

Rishi Khanna: Yeah.

Ethan Peyton: A and B type of thing. And that actually kind of reminds me a little bit of, not that they're similar, but, but it makes me think of a masterclass. Like they have experts, but they're not necessarily building a community per se. They are, they're taking their expert expertise, their expert knowledge and kind of. sending that in a one-to-many type of situation as opposed to where this and stock twits are maybe more of like a many-to-many type of situation. But let's talk a little bit about the differences in, shoot, words. What's a business strategy? How do you make money? The different ways to make money. 

So then let's talk a little bit about business models of maybe these different types because obviously, Pavilion is a successful community. Obviously, StockTwits is a successful community, and we won't use the word community for MasterClass, but it's a similar thing in that they have experts and non-experts. What do you feel like the business model conception is? based on the type of community that you're running. I know that's kind of a sloppily worded question, but maybe you can save me here.

Rishi Khanna: Yeah, I think, and you know when you ask that, I do think back to our conversation a little bit ago about Reddit, right, and their challenge with their business model. I think, you know, masterclass and communities like StockTwits and Pavilion have very different, you know, Master works as a distribution kind of, distribution of singular expertise.

Ethan Peyton: Yeah, they're a little bit of a different thing.

Rishi Khanna: Right? And so that you can monetize via subscriptions, via transactionals, one-off, things of that nature. I think when you look at communities, the reality is especially user-generated communities where the content and everything is coming up. 

Pavilion is going to be a little bit of a hybrid because they do have educational materials and best practices that are put together. by experts that are part of the community, right? We help contribute to things. When we first started, one of the main things we contribute is like... You know kind of offer letters right? Hey somebody's taking a new job to be VP of sales at some company What should they be looking at in their offer letter? What are the key terms? What are the key elements? 

You know these were things that we didn't talk about before and we all just kind of dealt with it on our own, right? Unless you were in the highest echelons and you had lawyers and stuff doing your deal. But you know for most people that's not the reality and so we were there helping each other like oh, hey, you need to you know make sure you get XYZ kind of severance package if you know You know let go or whatever or here's what you know equity should be. 

So I think when you're looking at communities like of where breadth matters, models like advertising are externally supported where revenue comes from sharing things from the engagement perspective. And Pavilion had that too in the early days, right? Those dinners were sponsored and the sponsor, the dinner might cost 5K, but the sponsor pays 15K, right? And so…

Ethan Peyton: Sure.

Rishi Khanna: …that's the margin there. But the other side is if you're delivering enough value, that subscription model is of real value, right? You wanna be a part of something. And the subscription model in this context is not new. It's a country club model, it's a gym membership model, it's whatever it might be, the analogous of people coming together in some connected way and paying for that service directly is tried and true. And so I think when you, communities can very much benefit from that subscription model. I think the subscription model works better in niche environments than the generalist environment, though you can still create space even in the larger generalist platforms, I think, for a subscription-based model.

Ethan Peyton: So what's, how does Stocktwits monetize? What's the business model there?

Rishi Khanna: All of the above. 

Ethan Peyton: Ooh.

Rishi Khanna: I’m glad you asked. So today, where StockTwits is going, we have our core business, our core product line, which is our community and our content. So we actually have our newsletters and stuff too that are perfectly free. We have great daily market wrap-up newsletter that comes out seven days a week called the Daily Rip. Million subscribers there, 40% off the rate, really awesome content. 

So that product line is generally monetized via media model, meaning advertising. And so pretty straightforward, tried and true. The other extreme, because we're in the markets, we did actually in great trading last year. So we have our own subsidiary that's sort broker-dealer and we're launching more and more asset classes that you can trade right on Stocktoids and that's a transactional model. 

But the real thing we're focusing on kind of second half of the year as well that has become an important cornerstone is launching what I call our tools and data product line. So this is premium data or data that is unique to us like our sentiment data and trending activity and things that investors and traders want access to at scale that we've traditionally never had a product for them, given them access in the way they want, as well as other tools and portfolio tools and alerting systems and all those things that happen in the world of investing and trading. And the business model that we married to that product line is generally a subscription model. 

And the beauty of the subscription model is if you can deliver more value than the person than the cost implies, you can build a very healthy business that essentially from a business model perspective could theoretically subsume the other two business models. So hey, if you're a subscriber to our premium super duper platinum bundle, well you know what? You're going to get a completely ad-free experience. So we've…

Ethan Peyton: Right.

Rishi Khanna: …subsumed that media business model. And maybe you also get... you know, severe discounts or steep discounts on transactional fees and costs and stuff of other asset classes wherever there may be fees and costs. So for us, you know, I look at it like, hey, those are our three kind of... key product lines, the execution product line, the tools and data, and then our core community and content. And they actually have three different ideal business models, meaning the best match. You can kind of apply any business model to anything, but what is the right match? What is the best match? It is something that you need to focus on discovery. So for us, we think, and having a diversified revenue kind of strategy, I think, is also important. Going back to over time, how do you focus on building a profitable, self-sustaining business? You've got to really think about that.

Ethan Peyton: So you mentioned earlier that in the days of yester, back when money was free and everybody could just build and build and build and never have to worry about profitability, I think that is, obviously it's gone. And now we hear a lot of founders that are building products that don't have a massive group of people that are already looking for this product. And there's always been the advice of don't build your product in a vacuum. You have to, you know, you have to have an idea and then you have to get it validated and then you have to build it and you have to revalidate and it kind of goes back and forth. 

But I think that there's, there's a kind of idea of. I can build not necessarily a community, but I can kind of tap into a group of people and whether, whether it be a community that you have some sort of control over. And actually, let's just stick with that. Let's assume that there is some sort of community that you have control over, that at some point in time, you can kind of survey them and figure out what it is they need and then you can build a product or a service that really serves exactly what they need. 

But let's then take one step back and talk about that community. What is the minimum viable value out of that community that is going to get people to come in and hang out until you're able to build out that product that really serves them?

Rishi Khanna: Yeah, the way I think about it, so I'm sure you have as well as listeners have heard, there's the find a thousand fans, find a hundred fans. It's probably some number between a hundred and a thousand.

Ethan Peyton: Mm-hmm.

Rishi Khanna: But you do have to think about it at milestones because you could find that hundred fans that are willing to pay. When I say the fans have to be willing to pay, you've got to be able to say, okay, hey, we've built something that we think you guys value because we've talked to you and stuff, but now, you know, put your money where your mouth is, right? 

And so you can find those 100 fans that are paying first. That's a great start, right? But I think too much of this advice makes it sound like, hey, once you found that it's over. And like you're off to the races, right? And that's not really how like life works and products work and business works. You have to kind of keep understanding, okay, what are the next milestones? Like that 100 fans is... a basic milestone, meaning, okay, there's a shot that more people care about this because you have a hundred people willing to pay for it. 

But then, depending on the nature of the product, the nature of the product could be, hey, you only need five fans. If you're writing a super high-end investing newsletter, there are newsletters out there that charge $5,000 a year. Listen, you get 10 people, you're making 50 grand a year on a newsletter that you probably love writing. That's probably a really good start. 

Then from that 10, can you get to 20? Can you get to 50 subscribers all of a sudden? You're at $250,000 right there in revenue just for writing a newsletter that delivers that value. You have to think about it in milestones and milestones are going to be relative to the nature of the business. But I do think, you know, hey, can you get whatever that right number is to say, can you get enough paying fans…

Ethan Peyton: Mm-hmm.

Rishi Khanna: …to say, OK, I validated this first milestone. This is enough to make this. kind of seems interesting and makes sense. What's that next milestone now that I need to, you know, kind of prove whether it's with the same value being delivered, it's more of a go-to-market issue, or hey, now I have to deliver a little bit more value? You know, if you guys really like the crossing the chasm, right, like, you know, how do you get over that chasm? 

Ethan Peyton: Mm-hmm.

Rishi Khanna: And I think you have to go through those milestones and steps to identify what are the right numbers there, what are the right, you know, what is the right, you know, fan base you need, you know, depending on the product.

Ethan Peyton: Sure, yeah, and that reference is, I think it's called 1000 True Fans by Kevin Kelly. It was an essay that he wrote umpteen years ago at this point.

Rishi Khanna: That's right, yeah.

Ethan Peyton: You know, there's so many more community questions that I could ask. I mean, I think we could probably go for two or three more hours, but unfortunately we don't have two or three more hours, so we're gonna have to move into a new topic. But fortunately, this is my favorite question that I get to ask every episode.

Rishi Khanna: Okay.

Ethan Peyton: What is your number one piece of advice for early-stage entrepreneurs?

Rishi Khanna: Ooh, number one, I might cheat in making a two-parter. I think, again, going back to what I was saying about myself being kind of a little bit old school, I will say, if you're gonna be a founder, right, if you're gonna build a real business, like if you wanna build a business, you gotta stay close to your numbers. You gotta know your numbers. 

There's too many founders that have come across that, you know. They've raised money because raising money was easy and they weren't paying attention to the numbers. 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 got to pay attention every day, every week, every month, stay on top of that.

And then the world generally isn't a home run world, meaning the mantra I use at Stocktwits, especially when I first came on. And we were like... How do we improve the community and make sure we're doing the right things? Is small wins equal big things. This is like compounding interest and whatnot. 

Focus on getting small wins, small wins every day or every week, whatever it is, whether it's in the product, whether it's in the team, whatever it might be, focus on how can you break things down into small wins that'll get you to your bigger picture, your bigger goal, whatever that might be. I think you do those two things, doesn't guarantee success, Those are two really just important foundational things, I think, just to running a business and having a shot to succeed.

Ethan Peyton: All right, excellent advice. Thank you very much for that. What is next for StockTwits? What are we gonna see here in the next couple months?

Rishi Khanna: We have a lot of exciting stuff coming out in the next couple of months. On one hand, in that execution business line, we are going to be launching some new asset classes to trade, so we're going to be sharing that in the coming weeks. But options trading and some other asset classes that we're looking at to bring onto the platform, so giving easier and hopefully simple access to that side of the world. And we're focused on how to, you know, the world of investing, the data is the data. We don't get to make that up, right? I don't get to make up the stock price of Microsoft as much as I would like to.

But you know, I think how we supercharge that and how we allow the community to enhance the value we deliver, we're working on a lot of features there. And to make it kind of easier to access, to that question we were talking about earlier, how do we make it more accessible? And enjoyable for that newer user, the simpler user, but deliver tremendous value to the entire community and especially then the pros as well.

Ethan Peyton: All right, Rishi, this has been a ton of fun. One last question, where can people connect with you online and how can our listeners support StockTwits?

Rishi Khanna: Yeah, you can connect with me on StockTwits. I'm RKhanna on StockTwits, Twitter as well, and then LinkedIn too. But yeah, publicly you'll find me on StockTwits and Twitter.

Ethan Peyton: Go find them on StockTwits. We're gonna put the links to everything else here in the show notes, slash podcast. Rishi, this has been, again, just so much fun. I could talk community with you all day long.

Rishi Khanna: would love

Ethan Peyton: And

Rishi Khanna: to

Ethan Peyton: so

Rishi Khanna: get.

Ethan Peyton: I'm just gonna say, hey, say more, give us the last words. What do you wanna tell us?

Rishi Khanna: Find your tribe. Don't make things don't need to be so stressful online. I mean, find your tribe, enjoy it. And for all the founders out there, listen, it's not easy. Find your tribe for that too. Being a founder, being a CEO is a lonely job, oftentimes. Let's stick to the community theme here and find the people that you can talk to about the challenges that we have. If you're a founder, CEO, like, hey, feel free, like I said, reach out to me as well. and let's keep building.

Ethan Peyton: All right, thanks Rishi.

Rishi Khanna: Thanks, Ethan.

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