YouSaid · the spoken record

Jon Stein

lines on the record: 73
first: 2018-10-29
most recent: 2018-10-29
sittings or episodes: 1
sources: podcast

Every line below is reproduced as it was said and linked to the record it came from. Nothing here is summarised or generated. Directory · Search · Corrections

“And some of them see this new machine with this virtual interactions and they see it as an insult to what they love. And then they play it. And most of the time they walk away with a huge smile on their face thinking, wow, that was really a lot of fun.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“It doesn't need to be a billion dollar company to make me happy. I'd be happy just selling a few hundred machines a year making it a lifestyle business and giving people something new and different and exciting.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“Fortunate in life that makes me want to help others. My grandfather said of those to whom much has been given, much is expected. And I will be paying down the debt of luck that I've had for a long time to come.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“So, I love this question, and I have to credit a lot of my success to luck and timing. I have described myself as opportunistic. And I think that's a common thread throughout all of my life. I've been lucky to have amazing supportive parents. I was lucky to go to a great high school with incredible teachers and mentors. That got me lucky to go to a great college. I was lucky to end up in financial services, which was a thing that had some real thorny problems that needed fixing. So to me, it's not about the things that I did. I really believe it's about the opportunities that have been put ahead of me. And so of course I work hard, but I see myself as exceptionally lucky. And it's that feeling that I've been so”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“Paying rent on an apartment, the same place, and now we've got both daughters living there. Pleena's parents live three blocks away, so we've got a pretty good setup.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“Be clear. Okay, yes. That's right. That's right. And even then, I have two daughters. I want them to have a great life. They're two and four. They'll probably someday accuse me of wrongdoing for saying this, but I don't want them to have an inheritance. I don't want to set them up where they don't have to work because I think work is part of happiness.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“And when I got into the industry, it demystified the whole thing for me. I thought, I can do this. I can learn this. I can figure this out. That was really confidence building for me. And I thought I can do it differently because I don't have this kind of this sense of what it is and what it should be. And I'm not here motivated primarily by money. I'm motivated by something different. And that allows me to have a different perspective”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“Well, I'm not attracted to finance, and I like to remind folks that in Dallas there's not really a financial industry. There wasn't when I was growing up anyway. In the 80s. And so when I was growing up, I didn't know anyone in finance. And New York always felt like this kind of distant place where, and banking felt like this thing where people were, you know, like the... Or like the wizard in the Wizard of Oz. I really felt like, wow, like the people who do this are just masters of the universe and they must be so smart.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“Yes, and I see us as partners as well. There's a little bit of this clubbingness in financial services. And so I never really liked that. I thought there ought to be more competition in this. But there is this sense that even though a customer could choose between us and Vanguard, well, anyone who's invested with us is also getting some Vanguard funds. So, in a sense, we're partners with them. So we work with a lot of the other financial services institutions.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“I always hoped and I thought if we're successful, this is going to be a massive opportunity. I said when we launched a TechCrunch on stage, if we're successful, we're going to have so much competition. Everyone's going to be in this space because we're ultimately changing financial services. We're changing the way people think about it.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“I said those words exactly and some others, and just said it just doesn't feel fair to me given all the years that I've put into thinking about this and all the time in business school that I've put into thinking about it. And I'm here. I'm committed. I know you guys are as well, but ultimately I'm driving this thing and I'm the CEO. And I feel like we need to be fair.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“I feel really lucky to have a great relationship with both my co founders. Eli is still on my board and a friend, and Sean is a great friend. I just saw Sean in London a few weeks ago when I was there, and we remained very close.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“I don't think one of my strengths is negotiation. I think I'm okay at it, but I probably didn't negotiate the best deal for myself from the get-go there”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“Sean and I had had this sort of like, you know, equal partners view, we're roommates, and he's obviously got tremendous experience to bring with his technical experience. And Eli comes in, I'm thinking, oh my God, he's got this legal experience is going to be so valuable. I guess we're all just in it together. We should all have 33, 33, 33, right? Yeah. And I forget if it was weeks or months, you know, a couple months after that, I just felt like this isn't fair. I'm clearly, I'm working so hard on this thing. It's not like these other guys aren't, but I've been thinking about this thing for years. And so I had to come back to them and say, I don't think we did this right. And I want to renegotiate our split here. And that was tough, but ultimately they agreed that they should take smaller shares.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“Do in the early days One thing that we did right was in the early days we created provisions around buyouts. And I'm so happy we did that. And when people ask for advice, I always tell them to do this because Sean, remember, was a co-founder and was involved with us from the very beginning. And then he decided to go to business school. And he went to business school in London. And we were working with him for a long time remotely like that. But it became very hard after a while when the three of us were in the office and we were coming to decisions during the day and then we'd have a call scheduled with Sean and he would just agree and we would have to rehash the whole thing. And it just became too tough and ultimately Sean decided I just can't do this anymore. And initially when I remember the day in my apartment, I sat down with Sean and Eli and we talked about how are we going to split this thing up. And I think they're just like.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“The way that I look at it is it took us a year to get to 10 million. It took us another six months to get to 20 million. It took us another three months to get to 30 million. It just kept growing faster. Then it was a billion dollars. And wow, a billion was a big number and it took us five years to get there. And now we add a billion every month and a half. So we just keep growing faster and faster. $10 million is a bad day for us now. That was our whole first year. And that's a slow day of net deposits today.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“Today it's 25 basis points or 0.25%. It's a fraction of what the traditional mutual fund charges or the traditional financial advisor charges. And we provided a really incredible amount of value for that.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“That's right. And so all these people decided to try us out. And at that time, remember, I just couldn't believe that anyone would trust us to manage their money because there's no fintech industry to speak of. There's no online, you know.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“And in terms of the kinds of customers you want to go for, the idea was if you've got money to invest and you're rich, you're fine because you can go to one of these wealth management companies and they'll hop on the phone with you and they'll give you really good service, but you got to give them 1% of your money and they're really only going to open the door for you if you have a million bucks. Yeah. You're saying we're going to give you a similar service type service, but you don't have to have a million bucks.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“It was five of us. And I realized, oh, like, we can't just stand here and wait for checks to come in. So I started to build a deck and actually think about who would be the right investors for us and go out and target them. At the time, we hired an attorney. And he set up some meetings for us. And the first meeting that he set up was with Bessemer Ventures. And we went out and we pitched Rob Stavis. And it was love at first pitch. We said, we're building this company that is going to help people make the most of their money. And Rob said, this is fascinating because for two years, I've been looking for a company that would answer the question, what should I do with my money? And this is the best one that I've seen. And he said, How about rather than investing a million dollars, you guys raise $3 million? And we said, wow.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“At TechCrunch, there's this blast of excitement. I mean, we won best startup in New York and there was all these investors there who wanted to talk to us and let's get meetings and yes, yes, yes, and let's go in this breakout room and talk. And I was like nervous and just so excited and telling them about all the wild things that we wanted to do. And then at the end of the week and at the end of the month, the phone stopped ringing. So after the launch, then I said, okay, now priority one is getting funded. And we don't have a lot of time to do this. We've got maybe like three months to figure this out. And by the way, in that time, we're asking our employees to reduce their salaries and even contribute capital to buy more equity, to pay themselves. So we were buying time as best we could until we could raise some capital.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“Million dollars under management. The betterment platform, and we were just thrilled. This was incredible, and then we started getting fewer customers and fewer customers and fewer customers. Wait, what do you mean?”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“Within the week. So 300 that day, right? 350. They were just there, and we were amazed. We think this is incredible. And they were small deposits at first, right? Nobody put in more than, you know, 10K or so, but all of a sudden, within a few days, we had a million dollars under management. Wow. We brought in 500 customers in that first month.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“Were 2,000 people in the room, and out of those 2,000 people in the room and 20,000 people online, 500 crazy ones signed up.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“Exactly right, and it happened. And when I say I really think we were unique in this, I mean, we had all of our team in the audience, I mean, the five of us, right? They were out there watching their presentation, but also had headsets on and were answering emails from live customers and monitoring the site traffic.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“Chris Saka and I had this amazing exchange where he says. This thing is just too simple, and people like financial services to be complicated. This is way too easy. And I can't imagine anyone getting that. And Michael Errington, who is the head of TechCrunch at the time and was a real booster for me. I mean, he was backstage saying this is great. I love what you're doing. I mean, credit to him for just his support. And he comes out and he says, Chris, let me just interrupt you. Are you saying that if they just made the interface worse? And if they actually made it harder to use this thing, you would be more excited about it. And Chris Sacka says, yeah, that's what I'm saying. And of course he was wrong. People do value ease of use even in financial services. And I've talked to him about this since, and he's laughed about it and said, I've been wrong as often as I've been right. So it's not the first won't be the last.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“I was so nervous. I was terrified. It was probably the most nerve-wracking day of my life. I'd been up all night. I knew that I would have to deliver this amazing speech if I wanted betterment to be successful. And this is my baby. This is the thing that I've been working on for years. And I've been telling all my family is going to be successful, right? And I've been telling all my friends in business school and so on. This is my life for the last three years. And now it's on stage and now we get to see how have I done?”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“The Tech Richards on Monday. All of that on top of trying my best to put together a presentation and pitch this thing. I woke up in the morning, and the Blackberry timestamps when you leave these notes, and I saw every 30 minutes or more all night long, I had been awake and writing down edits to my presentation. So of course I had not slept at all.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, like it traded through, but she couldn't actually get her money back. Oh, wow. So we had to go and fix withdrawals. And so it was a crazy week. I mean, we were working literally the entire week. And then this is on the product side, right? So we've got some major things that we're trying to get together on the product side. The regulatory stuff, we got the approval on the Friday before we were set to launch at TechCrunch on Monday. And of course, they're closed over the weekend. So it was literally down to the wire. It was the last day they could possibly have given us approval. We got the final approval on that Friday.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“They were putting real money in. At that time, we had to actually start to test the pipes, right? And think goodness we did because in that week before, we'd all been depositing, right? Everyone had been putting money in. No one had taken money out until the week before there was this flash crash. And the assistant of our partner, Ryan, was checking her account during the moment that the crash happened. And she panicked. She freaked out and she withdrew her money. And thank goodness she did because it showed us that withdrawals didn't work at all. So, you know, we didn't work.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“So we were pulling that code out in the week before we launched, we were testing the entire system. And we'd been testing it for months.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“All this stuff just Yes, I did. And I learned from user research thankfully that only I wanted them to do that. Yeah, right.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“Facebook was everything at this time, right? And this whole idea of network effects, I was like, well, clearly we're going to have some network effects. We've got to build that into our products.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“It was hugely stressful. So let me just set the context leading up to TechCrunch. The week before we decided to start to pull out code that had customers sharing information with other customers about what was their allocation. I had this whole idea that people would be interested in seeing how their friends were invested. What are my friends' returns? What are my friends' allocations? And as we started to user test this and show it to people, everyone said, this is terrifying. I have no interest in seeing what my friends are doing.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, and Tech Runch was hosting their first ever Disrupt conference in New York City the following spring, May of 2010. And I thought that's our launch date. And one of the rules for pitching at TechCrunch was you have to launch on that day. And that's what really helped us get up and get going.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“We did not. That timeline kept pushing out. And I remember, wow, I was trying so hard to keep the pace up on the team. You know, I was just like, it's really important that I be there. I can't let any time slip. And what I realized was we needed a forcing mechanism. And I think Anthony said, hey, we could apply for TechCrunch. And I thought, hey, that's an interesting idea. TechCrunch.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“People are confused and frustrated with the existing financial institutions. I can see why there's a loss of trust for good reason here and just seems like a great opportunity to me. And I'm an opportunist. And to me, there's something about a really thorny, hairy, ugly, you know, opportunity that everyone says, don't touch that that is actually quite attractive because when everyone else is running the other way, maybe something has been missed. Maybe there's an opportunity. And I really, I credit us starting at that time with a lot. I think it was lucky that we got started at that time. There were a couple other competitors that started at that time that still exist. Everyone who started since is either really tiny or has been acquired or this or that. So it was a good time to be starting this business.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“I was talking to all my professors. Most of them knew that I was working on this thing, and they said, John, are you sure this is the right time to start this company? This seems like the worst time to be going into financial services. And to me, boy, that just drew me to it even more. Really? Yeah, because, wow, if...”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“Yeah. But I think one thing to remember is September of 2008 was the beginning of a real financial crisis. Yes, exactly. And at that time,”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“And Sean, and at that time, right after I graduated, we hired Anthony Strouth, who'd been one of my colleagues at FMCG and had built online banks for some major national companies and had this experience with the customer journey. And so he joined as our head of product.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, we were mainly paying ourselves. It started to cost more as we started to hire our first employees, but that was later.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“So remember, I mean, I had a good job as a consultant for several years, and I'd saved quite a bit, and I was able to live off my savings for a couple of years. And so was Eli. Eli had saved money as well as a lawyer. And so we funded the business out of our savings.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“He was meant to figure out what entity we be, and that evolved into him being our COO and managing all of our broker-dealer operations over time. But he initially was there to figure out what's the right, should we be in investment advisor or something else. And we settled on investment advisor because an investment advisor is ultimately the fiduciary in someone who's bound to do right by the customer, which just felt right to us. It felt like the right kind of organization.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“Eli Bravman is my co founder, and he was a securities lawyer, and I thought I talked to him about the problem that I was trying to solve. And he said, yeah, I can relate to that problem. I'm trying to do something smarter with.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“Believe me, I tried. When I say I wanted to build a totally new kind of company around the customer, I mean it. I didn't want to be a bank. I didn't want to be a broker. I didn't want to be any of those things because I think they all have bad reputations for a reason. They're manufacturing product and selling product. I wanted to build around the customer and I thought maybe I don't have to be. Regulated entity at all. But everything pointed back to we do have to be a regulated entity. The law is well written and it was in my in 2008, in my second year of business school, in the early fall that I had a chat with Eli Braverman.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“It was amazing luck. And fortunately, Sean always pushed for solve the most immediate problem, make it real as quickly as possible, which is a thing that I always tell people today when they ask for entrepreneurial advice. I say make it real as quick as you can. That comes from Sean.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“Everything, and I did. I built the first version of the site. My roommate at the time, Sean, was an engineer at Google. And he's one of the smartest people I've ever met, and he kind of got me set up. This is Sean.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“Yes, embarrassingly, I really thought I was going to build the whole thing myself. So that summer that I was in business school, I taught myself to code.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“For example, we give you personalized guidance about what you should be invested in and what your goals should be and which accounts to open. We tax manage for you to save you more than you even pay us in fees, in taxes. We give you net positive returns on your investment with us. And I'd say that the concept has become more and more sophisticated over time. And it's been, what's the first slice? And the first slice is make it really easy to answer the question, what should I do with my money? One thing I found that was common across everyone was they felt bad about the thing that they were doing. Everyone felt guilty. Everyone felt like I know I'm not making the most of it. I know I'm not doing everything I should be doing.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT
“Well, one of the challenges when you're really inventing something new is nobody wants it, right? People say, if I said, hey, would you like a bank account or an investment account or this new thing? Well, no one's going to want the new thing because it's scary and it takes a lot of time to build trust in financial services. So it took time to get that message right. And the best way to think about it is we take all the best practices that a great investment advisor would put to work for you if you had one. And we make them smarter, faster, cheaper, better.”
2018-10-29 · How I Built This with Guy Raz · Betterment: Jon Stein · IDENTIFIED FROM THE TRANSCRIPT