Clayton Gardner has raised $75M in capital to modernize investing. His startup is already helping tens of thousands of individual investors diversify into new asset classes with ease. The venture, Titan has raised funding from top-tier investors like Will Smith, Jared Leto, Andreessen Horowitz, and Kevin Durant.
In this episode, you will learn:
- How to attract investors
- The future of investing
- Alternative asset classes
- Clayton’s top advice for building a successful business
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This episode is also sponsored by Vinovest which is a company that allows accessible and affordable investing in fine wines, an investment that is less volatile and often more lucrative than investing in traditional stocks. Go to their site and receive 2 months of fee-free investing. Be sure to mention that the DealMakers podcast is helping you to same on 2 months of management fees.
For a winning deck, take a look at the pitch deck template created by Silicon Valley legend, Peter Thiel (see it here) that I recently covered. Thiel was the first angel investor in Facebook with a $500K check that turned into more than $1 billion in cash.
The Ultimate Guide To Pitch Decks
Moreover, I also provided a commentary on a pitch deck from an Uber competitor that has raised over $400 million (see it here).
Remember to unlock for free the pitch deck template that is being used by founders around the world to raise millions below.
About Clayton Gardner:
Prior to co-founding Titan, Clayton was an analyst at a NY-based fundamental long/short equity hedge fund, where he led consumer technology investing. Previously he was an investor at Farallon Capital Management and Cerberus Capital Management investing in public and private companies.
Clayton graduated summa cum laude from The Jerome FisherProgram in Management & Technology at the University of Pennsylvania in 2012. Clayton earned a BAS in Computer Science and a BS in Economics with concentrations in Finance and Statistics and a minor in Mathematics. Originally from Chicago, he is most passionate about investing and software.
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Read the Full Transcription of the Interview:
Alejandro: Alrighty hello everyone and welcome to the deal maker show. So I think that today we’re gonna be learning quite a bit I mean the founder that we have I think that we’re gonna be really learning about persistence because he was rejected by over a hundred vcs and nowadays I mean he’s in a rocket ship. So. I guess without further ado. Let’s welcome. Our guest today Clayton Gardner welcome to the show. So originally born and raised there in Chicago so give us a little if I walk through memory lane. How was how was life growing up.
Clayton Gardner: Thank you very much for having me excited to be here.
Clayton Gardner: I had a great childhood I grew up in Chicago the fondest memory I’d say was very competitive childhood I have an older brother brother younger sister my parents will very much try anything and then figure out what you like to do and then really hone in on that type of type of upbringing. So. All sorts of sports side hustles businesses investing was one of them which I’m sure we’ll get into just kind of informed what I want to do with the rest of my life today. But yeah, a lot of a lot of trial and error a lot of hobbies. A lot of interests from music to to basketball and so forth. So I would say like a lot of creative creative energy.
Alejandro: And why finance you know out of all sectors I mean out of all sectors. It sounds like finance you know you really went into it right away you know with your internship after being a pen in Goldman Sachs so so why finance
Clayton Gardner: As child.
Clayton Gardner: Yeah, it’s a great question I started investing when I was 12 um, my parents you know opened a custodial account for me and 1 of these brokerages. You know, gave me a few hundred dollars to buy my first two stocks and for me at the time it just felt like game. Yeah I talked a little bit about like loving to play sports and being very competitive. It was the most adrenaline driving thing in the world because you wake up, there’s a new score every day. Um, yeah, you’re you’re playing a bunch of bunch of different players each of them has their own game their own skill sets some point guards some are you know power forwards and so forth. So. It. It was what it was. It was like wow I can combine the competitive component I love about sports with making money this sounds pretty fricking. Cool. Also I would say the fact that I had had some businesses where it was washing bikes you know on my neighborhood block to you know, starting an investing club and. Kind of monetize that during high school I would say there’s a lot of other entrepreneurial endeavors so it was just it made sense for me to want to pursue business. It was kind of the the combination of of competition and and gamesmanship and and money and and capitalism and I thought that system had worked very well and was excited about that. So. That informed why I decided to go to Penn where I studied at warharden. Um, and ultimately I kind of just reinforced the fact that I want to do this with the rest of my life I would say at that point I wasn’t really sure what finance meant to be totally honest aljandro whether that’s I didn’t know what investment thinking was I know what sales and trading was all these subsectors and components. So. Ward was a great great place to figure that out and cut my teeth. Um, and I’m sure we’ll get into the evolution of my journey through finance but still today investing I see it as like 1 of the funnest most enjoyable and obviously if you if you’re good at it lucrative games of of all time. So. It’s a huge passion.
Alejandro: So out of all things I mean when when you finish warton you went a but you went add it more on the private equity side and you did that here in the in the East Coast but then you ended up going to the west and and and to to do hedge funds I mean. You know who would have thought going to to the west coast to really do hedge funds. Why not staying here on the East Coast
Clayton Gardner: There’s not too many finance firms in general. Ah west let alone hedge fund so it was very much the specific type of firm and the people at the firm that drew me out there. So you know the reason I started it in New York I mean like most people who you know they graduate with the degree in economics or finance. You know, a lot of your peers your your professors say go to investment banking why because you get to learn how businesses work but more specifically you learn grit you’re pulling all-nighters you’re building decks. You’re building models you learn a little bit of how accounting applies to the real world. How Ceos and management teams think and so you know you learn grit. In practice. But you also learn how some of the business world works I wasn’t too particularly fond of the idea of you know, hundred twenty hour work weeks and so especially ones where I would be advising but not really responsible for the outcomes of what I was advising ah to to to manage your team. So. Was interesting about the place I went in private equity was it was ah what’s called a buyside firm which is folks that actually own the outcomes of the decisions they’re making so similar to hedge funds pe firms are buying entire companies. They may make money they may lose money. It’s sort of an eat where you kill type of environment I was like look if I’m going to spend a couple of years working my butt off. I would love to at least have something to show forward I want my incentives to be aligned with that work to make sure I’m doing great jobs so I was like okay, let’s go to private equity at least I get that buyset experience. What I learned ultimately was the particular firm I went to was very deep value. So there’s a bunch of different flavors of investing. There’s. Quality growth investing I would say the inverse of that is distress deep value investing so you’re looking for companies that are really really financially cheap. Um, probably cheap for a reason either. They’re shrinking businesses with lots of headwinds. Maybe there’s been management turnover and the particular firm I went to was exceptional at that strategy. But for me personally it didn’t really jive with my personality I’m the type of person I get up I want to know how can I grow and get a little bit 1% and better today. How can I be positioned with growing businesses growing sectors optimism in the world as opposed to kind of squeezing lemon so to speak for the last few drop of juice and so. I said at a minimum I need to make a shift to go see if investing in quality businesses paying a reasonable price for really outstanding growth maybe drives a little bit better and and at the same time I wanted more reps since you know when you’re in private equity. You spend a lot of time on one single business and sometimes it can be months often even years. You’re spending just trying to figure out should buy 1 single company on the public markets. You know for example in inequities in stocks. You can be looking at multiple businesses every day every week every month and so my my personality is that I learn better by getting more reps making mistakes failing fast failing early.
Clayton Gardner: And tweaking my process and so I decided to move to public equities where I can get more shots on goal and again align my own time with quality businesses and quality sectors so transition out west to San Francisco to a firm called feralon was amazing because and and it was really for that firm I was pretty set on staying in New York but I had ah a colleague you know, referred me to toferullon found by a guy named Tom Steyer who actually came out of one of Goldman’s desk’s desks I think he was in the 80 s or 90 s phenomenal. Firm had an amazing 30 year track record multi strategy firm. So not just public stocks but credit merger arbitrage. Ah, pharmaceuticals all sorts of really interesting stuff and so I said 1 this is a great place to see if that quality public equities investing style fits with my personality and at a minimum if if it doesn’t I’m going to learn from really smart people that have a track record of doing this really really? well.
Alejandro: So so then how do you decide that it’s time to come back to this coast.
Clayton Gardner: Well I went out west I met a girl I was still with thirty that she’s just fantastic and we had both wanted to come back to the East Coast and a lot of our friends were out here. Um I really really enjoyed New York and you know in your when you’re in new mid to late twenty s.
Alejandro: Ah, ah.
Clayton Gardner: As we were discussing before the call here. Ah you know there’s there’s so much to do in New York you can’t do it in the two years so she wanted an opportunity to see what that was like um I also had had you know had approached 2 years at that point at farlan I wanted to make a move to be able to have a little bit more autonomy and and and. Call it ah authority over my domain. Um, you know ferolon’ is a really big firmn with a lot of assets I said I’ll kind of want to go a little bit earlier and a little bit smaller smaller team smaller asset base and just kind of be able to own more ah of the coverage of the responsibility. So. Things really lined up. We. Both had really cool opportunities open myself and and my partner ah I has joined an early stage fund a public equities hedge fund that had just started about a year or two before I joined 2 other partners. They come from more the consumer side of things focusing on things like soft lines you know apparel. Um. Food and beverage businesses my background at feralon was more on a tech side actually consumer internet telecom media and so you know you’ll you’ll find you’ll find a lot of New York city hedge funds and more broader broadly investment firms tend to focus on those 2 sectors. It’s really interesting consumer and Tmt. I think the reason is that’s where a lot of the secular growth is ah consumer spending continues to compound technology is reducing costs. It’s highly deflationary. It’s expanding access and opportunity. So most of the quote unquote good businesses I would say are in those 2 sectors and so a lot of the profit opportunity is so. This fund was no different. They said look we want to be a Tmt consumer fund. We’re looking for a young hungry analyst who’s good at this thing called tech let us focus on consumer and we can kind of cover. A lot of the opportunity out there in the world I said that sounds pretty good I can come in. You know, be responsible for essentially half of this billion dollar you know a Un fund um and and it’s also very entrepreneurial. The plan was to kind of grow the business spin out raise more capital so going back to my earlier you know childhood I always wanted to start my own thing but I always wanted to like see what it was like to bootstrap work from the ground up so that kind of guided our decision to to come back east and. Been out here for for the last five year.
Alejandro: Now Why? Why do you think it took you so long to go out it and and start your own business.
Clayton Gardner: Well, it’s interesting. Actually after we landed back in New York and I was at this fun I was only there for about seven eight months I quickly realized everything I’d been interested from an entrepreneurial standpoint was true. But. I didn’t want to just do long short equity investing for the rest of my life or I should say I thought being an operator could add a lot more to what I wanted to get and and leave the world with frankly, um, you know there’s a lot of hedge funds. There’s a lot of investment firms in the world particularly the flavor that I described consumer and teamt hedge funds. Ah, by the way, the good ones generate huge returns for their investors. Many investors are pension funds endowments and so forth. So I do believe that’s a net good to society. But when I thought about my personal skill set like what kind of what impact could I make it felt like it could be much much bigger. Than just you know, putting up returns for a subset of lp so my cofounder Joe and I who actually you know we go back to our first day of undergrad at wharton he had a similar kind of post-grad experience firms like Goldman and mckinsey because incidentally it was also at a small New York city startup hedge fund at the time and. Kind of had this light bub moment which was we joined these small funds because we want to do something entrepreneurial something a little bit risky something early where we could try new things take risks. Um, but our backgrounds lend themselves to a lot more than just investing. They lend themselves to building creating from scratch and so we started thinking what are the big problems. And our lives that we’ve been thinking about for a while that we are uniquely positioned to go solve. Um and the one that hit us I mean if you just look at our backgrounds. It makes perfect sense is how can more and more people have access to the types of things that Joe and clare are delivering to wealthy investors. Um, from you know my early days in distress private equity to public equities. Ah, Joe’s experience advising private companies. Um a lot of that pretty much all of that is inaccessible to 99.99 of the world for a handful of reasons and so we said the idea of democratizing access to professionally manage products with experts who’ve been doing this. Full-time for a long time. Um is a really exciting problem and opportunity so we took about a year off from our our jobs. We set up a corporation. Yeah, hired our our cto max and start spitbulling on ideas and ultimately landed on what we’re building today which is a company called titan. Ah, we have to say we’re building the next fidelity fidelity is today 1 of the largest brokerages and and advisors in the world. The core nucleus of what it started as was a way for people to have their money managed by their smart people in a vehicle called a mutual fund which now by the way commands Tens of trillions of dollars and so we said.
Clayton Gardner: Any measure this is a huge problem people are voting with their dollars they like humans managing their money. But if you look at the younger generation that are spending hours a day on Tiktok on Instagram Etc they’re not adopting these products. Why is that either. They don’t want them anymore and they’re going against. hundreds of years thousands of years of human history which says people like to trust other smart humans when it comes to financial resources or maybe it’s something about the user experience the costs the accessibility of those products so fast forward to today. You know we have a platform live with close to a billion of au m. Ah. But 50000 plus retail investors. Um, and across 4 products that we built and managed in-house and you know we’re thinking about partnering with other other professional and fund managers to be able to bring their products to retail. So yeah, it’s a really exciting journey and the problem the corep job we’re solving is you know push button get my money managed by an expert. In what the goal is pretty much anything from the public equities in privates that I started with in my career to I mean you name it ajandra it could be real estate. It could be crypto. It could be fix income. It’s a really exciting journey because ultimately I think it will be a net positive. Get more people into more types of investments.
Alejandro: And how do you guys make money. What’s the business model.
Clayton Gardner: It’s a pretty simple traditional advisory model right now. So 1% of of assets under management across each of our products um anything about traditional mutual funds that is actually roughly the industry average. So and then obviously there’s no fees on top of that a lot of traditional advisors will. Charge expense ratios 12 b one fees. There’s a lot of hidden fees in the traditional raa world. So. It’s just 1 flat simple fee. That’s if you have over $10000 value m with us for below $10000 of assets. It’s $5 a month so it’s got 1 simple fee for fraxis to those 4 products and. Yeah, we I think a big part of the emphasis of kind of the value propp of what we’re building as well is yeah, know some of these products pretty much all these products are really really expensive and much more expensive to institutions and and wealthy individuals Today. You know it’s a typical fund think back to like my days and private equity. Ah public equity is it was 2 and 20 was the standard now. It’s closer to to 1 and 10 but you’re talking about all in multiples higher fees than titanness charging despite the fact that we have a mobile app. We’re direct to consumer the people that are investing on our platform feel like they know our investment team personally, even though most of our 50000 plus investors. We’ve never met. They’re all across the country from all walks of life from $100 on the platform to $1000000 plus so it’s really cool to be able to see you know we’re not We’re not really innovating on pricing too much. It’s like a pretty simple flat fee. But the distribution is enabling us to reach a lot of other people that.
Alejandro: Now the you know for Obviously yeah, a company like this it requires money right? I mean you need money to build something like this now I know that in your guys’s case being able to raise money was not very easy at the beginning.
Clayton Gardner: Otherwise win.
Alejandro: I Mean you guys were rejected quite a bit How many how many times were you guys rejected by Abcs at the beginning. Yeah.
Clayton Gardner: We had a I think Joe and I had a bet whether it was be over under 100 after the first 10 we were like this is this is not going well but let’s let’s keep pushing on I think Joe won that bet because it was 110 plus times we stopped counting after 110 so um and keep in mind these are.
Alejandro: Become and and and what what? what kept you guys going I mean it’s unbelievable.
Clayton Gardner: Yeah, these are this? Ah honestly, the the family and friends was was what practically kept us alive but both in good spirits to be able to to keep our heads up and you know come back from a trip out west to to Sand Hill Road and keep building despite getting told by you know some of the investors who have backed companies like you know Apple and Google and Whatsapp and Instagram being told this is a silly idea. Um, but then keeping us in good spirits. Our family friends. But also we had to raise a little bit of money right? We we were paying ourselves the the literal New York minimum wage tiny little wework at the time just to be able to not bug our roommates that we were you know? ah you know overstepping our boundaries working at 3 a m inr apartments and and even then we were we were running on on you know, little oxygen I think it was you could count a few thousand dollars in the company bank account. Um, at that point in time. So. Got really creative. Got really scrappy. We’re super frugal all along. That’s really informed how you built the company today. Nothing’s changed. We can talk about the fundraising history. We. We got a lot more money today than we did then but nothing changed that about that philosophy. Um I would say also there’s a little bit of Rebel Dna coming out of that. Yeah we we. Going back to my childhood and in Joe’s too we’re very competitive people is sort of like you know when our parents told us no I want to go whatever you tell me I can’t do I want to go do I want to do the opposite of what the authority tells me so when people say this yeah active investing is dying everyone shipped thing that are money to pass investing haven’t you guys seen the buffet bet. Haven’t you guys seen that the hedge fund manager who bet Warren Buffett he could outperform an index fund lost like haven’t you seen Xyz data point we were like yes we have seen that. But here’s why we as users understand the problem we’re solving at a more cognitive and emotional level. Not just a functional one. And the fact that they couldn’t quite see that we could have said oh yes, sir yes, ma’am we understand logically you know this is a bad idea but the inner rebel in us were like well let’s let’s actually prove it like let’s prove these people wrong and like I want we want we wanted to win and and that’s you know that’s a. Perhaps at some you know to some degree in some environments an unhealthy you know, attitude to have but I think you need to have persistence you have to have those kind of that chip on your shoulder because as as I’m sure we’ll talk about that was that was just the top tip of the iceberg in terms of the obstacles we would we would face.
Alejandro: I hear you now a turning point WasYCombinator so how do you guys say you know land on y combinator.
Clayton Gardner: Well I talked about us having a few thousand dollars off in the bank. It was kind of ah we had ah what we call the whiteboard moment I think there this March of of 202018 at a whiteboard moment where we had a whiteboard but in the little wework office and we had a one of these sharpies and we drew 3 columns. We said look guys. We have a few thousand dollars off in the bank. We have 3 options option one kill the company return them this this few thousand dollars to our our grandmother our family and friends and say sorry we we tried our best speaking speaking to the you know the inner. Competitors in us that was obviously the least attractive option option number 2 take this money and repurpose it. The proverbial pivot. So oh let’s go try think of another idea I’ve learned historically trying to sit in the room and think of good start off ideas is not a way to find a good startup idea you got to start with a user problem. You’re passionate about. And this is by far the most passionate problem we’ve ever been passionate about ah so there was no other ah problems that jumped to our mind. So we said okay, not a great idea to pivot without knowing what we’re pivoting to the third option was stretch this as far as humanly possible and apply 1 more time to this accelerated out west called ycombinator for what it’s worth in addition to those 110 vc rejections. We had also got rejected by y cominator twice. So this is like third times a charm we’re running out of money. We’ve been rejected by world’s best investors but here’s this accelerator that’s spawned the dropboxes and the stripes and the airbnbs. Other ideas that were also rejected a lot of times by smart people so that these people will probably hopefully give us 1 more shot so we applied do YCombinator we chose that third option on the light port. We got an interview so we flew out west and we got in and so you know just like that and that was like the most. Probably 1 of those transformative moments in the company because we went from having a few thousand dollars in the bank to you know now one hundred Twenty Thousand that was what the Yc check was when you get into the program. Um, every single week during that three month you know summer program out west you meet with your advisors. What’s called group office hours. They give you advice. Again, speaking to the competitors in us every week we’d have our advisor we call them. You know our coaches say hey coach how how high you know how high do we need to jump this week they say you need to jump four feet we’d come back the next week we’d have jumped six feet so it was just that rolling thunder of competitiveness focus. You know you’re in a house in a suburb in Sleepy Palo outto with your ssos across the country. It was like the perfect breeding ground for like competitive hungry people with a ship on their shoulder and a little bit of money to to kickstart the the wheels and yeah, fast forward a few months we ended up being I think one of the number 1 companies in the.
Clayton Gardner: In the batch of of I think it was 9000 plus that had applied ultimately so transformative moment got amazing investors at that point from the founders of y combinator folks like Paul Graham Sam Altman and others a couple of great institutional firms and it was a big stamp of approval I think um. Yeah, things didn’t get any easier after that right you have the techrunch announcement. Yay surprise you know we’re we’re validated and then you have the what they call the trough of sorrow which is the news cycle moves on there’s another batch of companies that gets headlines and you know your user growth slows your asset growth slows. You’re forced to get back to building and so um. But that was a big I would say a big milestone on the journey so far.
Alejandro: So now in in your guys’s cave. Obviously I mean you were now right in the Wave. You had the validation but it sounds like um, you know there? Ah, a pivotal moment. You know where the company needed heart surgery because of the broker deal I mean obviously. For the people that are listening. You know Broker dealers are those licenses are very high in demand especially when you’re in the finance sector you need that really to to operate. But in this case, it sounds like you guys needed to to to course correct. And kind of like redesign the path forward. So What happened there.
Clayton Gardner: Yeah, so you described it really really well. A broker dealer is the heart and the soul of ah, an investment advisor. It’s how ultimately you you bring your product to investors and let them buy sell you know, ah and execute trades. We. Got you know we got the seed round from from y combinator. It was mid I think fall 2018 early 2019 we got a ah quick heads up from yeah the the folks at our broker dealer saying you know there was an acquisition and that that heart would need to get quote unquote ripped out of titan. And and moved to another patient so we without a heart and without a soul. We couldn’t you know principally function for for six months we had 2 engineers at the time our cto max and an early engineer of ours. We went heads down and focused on let’s find another heart. And do this transplant as fast as we can while our vitals are still you know somewhat intact from a from a frontend you know customer standpoint what that meant is you didn’t really see any changes in the app for about six months in a world where Facebook instagram every every company is shipping app updates bug fixes performance improvements. On a basically a daily or weekly basis. You know to have a new innovative fastoving company. Not really evolve for six months it was like pretty devastating. It was one of those things where we didn’t really have an option we had as limited res researching our engineering resourcing as we as you could so you know. We we understood at the time why that happened you know that that heart ultimately went on to to be transplanted to you know the company square and their business cash app. So they’ve done amazing things with that with that business and that growth but ultimately added just another I would say battle scars. Ah, you know we kind of licked our wounds ultimately did that that transplant successfully it was a good learning experience also as an early stage startup. You really want to make sure you minimize you know the different ah ways things can faults can arise right? you want to reduce dependencies. It’s hard enough to find something people are going to want and pay you for that’s. That is I think it’s something like probably less than 10 percent of startups even find product market fit. So once you have product market fit you know that’s the most important thing the next thing is make sure you can keep it make sure the other stakeholders from your Aws to your payment processor. Make sure you have a plan in place. And it sounds convenient to say because you know there’s always other another fire burning and you don’t have infinite time and resources to to focus on 20 different alternatives. But there’s a good lesson for us to not ah, not put all your all your eggs in 1 basket.
Alejandro: Now Obviously you guys say were able to weather that storm and and recently too you announced a pretty big series B So how much couple have you guys raised to date. So.
Clayton Gardner: So public we’ve we’ve announced raising. Ah I think roughly $75000000 to date and been around. We launched the the company about four years ago sorry our most recent round from Andreessen Horowitz was a roughly $60000000 series b ah, we raised that in in May of 2021 and what’s interesting about fundraising. Ah Andros you know it’s it’s it’s it’s sort of the you know it’s kind of like you know when you’re you’re prepping for the homecoming dance right? It’s ah yeah, the most sought after people. Ah, ah. You know are often. The people that don’t need to be sought after right and the people that want to be asked out are usually you know they’re not asked out for reason and so it’s one of those things where you know from a fundraising standpoint when you need one. That’s when people are least likely to give it to you ironically, it’s when you don’t need money when you’re probably going to have a lot of check thrown at you and the reason is pretty simple. Ah, people want to invest in things that are doing well that are growing if you’re growing and doing well ostensibly, you’re on a pretty good path. You have some leverage. Ah you have some visibility you could raise on your terms you have negotiating leverage and so is one of those things where you kind of you realize how the game is played and there’s a little bit of a song and dance in terms of figuring out that. Fundraising process. But um, that’s the one part of our journey that’s gotten really really? ah, relatively easy compared to things like building things users want because we’ve been able to focus and find product market fit and like expand upon that each fundraising round has happened in a quicker period of time with a. Fewer number of people involved with less process with more focus and every round is has has led to it just more and more exceptional people on board. So um, yeah, anishha and Dressen Horwiz joined our board who’s been absolutely fantastic. That was like a 48 hour process to get that all buttoned up. So.
Clayton Gardner: Night and day from that you know the six month road show Joe and I were doing with those those the silicon valley vcs in the early days and just again a testament to build something people want focus on growing the score kind of takes care of itself from that standpoint.
Alejandro: And you are alluding to it that you guys raised the this last round on 2021 I’m sure that 2020 really changed the you know many things for you guys I mean definitely for the world with covid you know whether that was around culture or around the business because especially when it came to investing. You know we saw a lot of craziness happening. You know with the game stop the wall street beds. All of that kind of stuff. So how do you think um, you know what? what was the titan that went into 2020 and wars a titan that came out of 2020.
Clayton Gardner: Sure I mean early twenty twenty um the way immediately jumps to mind this is covid obviously and you know we we were a little bit I won’t say I won’t say having you know seen the future. But I think fortunate that we. Knew the risk reward or could assess some of the risk reward of that scenario pretty early as a business so you know we weren remote in February of that year if you remember we was really early to Midmarch 2020 where you know all the headlines started talking about covid people started working from home. The world went remote and then it was like the world shut down in a matter of days. Um, fortunately by being a couple weeks ahead of that and working remote. We sort of got got got to take stock of you know what was our game planning going to be. You know, thinking back to our earlier roots we had never had the money to even hire people let alone lay them off. So the idea of if if the worst case scenario happens and this global pandemic really spreads. Us having to do the opposite how to lay people off people people that have worked so hard and and stuck with us so long through so the ups and downs from the fundraising to the heart surgery I described was like unacceptable for us as a business so I would say culturally the fact that it was so hard to raise money made us very very frugal and very cost consciousscious. Very people focusedcused people first. So we we took our salaries down to the New York city minimum wage at that point time we didn’t lay anyone off. We cut our op x well ahead of when we needed to and really hungkered down and prepared for the worst and so as 2020 went on as the world shut down people were figuring this whole covid thing out. We read? Well a lot of other people were playing. You know I would describe as defense. Um figuring out how to cut costs how to pull back marketing spend. We were able to go the opposite way and and play play aggressive offense. Um, and that meant making our first few hires in places like customer service and and a few other engineers. Being able to ship features like instant deposits right? when the world is is entering covid if you remember the market was up five down five percent a day in worlds like that we we really accelerated product development around ways people could capitalize on that you know and so by getting your money invested in minutes instead of days. Via for example, this feature we launched called called instant deposits instant investment that was an example of something that we shipped aggressively into that environment that let instead of ah people pulling the money out and moving to cash and saying I need to protect my life savings people were confident enough in titan to use that feature and say I’m going to be aggressive and take advantage of these dips. Take advantage of this volatility. So from a people standpoint from a cost standpoint from a a product development standpoint. You know it’s sort of like the prepared mind. It’s like planning is useless but but plans are useless but planning is everything I think prepared minds were’re we’re very fortunate heading into that. Um, obviously it was a huge global crisis but the silver lining was.
Clayton Gardner: Um, for our business. It proved it proved that that frugal mindset was was worthwhile so it was ah it was a good transition you acknowledge because between that early heart surgery I described and the series b was a really monumental period of 2020 and and ultimately that growth that focus was what enabled us to raise the series a from general Callys in the fall. So I’d say from from y combinator while that was the big moment in 2018. It was kind of a 2 year lull I want to call call it a lull but a 2 wo-year period where we had a lot of ups and downs that you won’t read about in the press or in the headlines. But. 2020 was so formative and we raised our first priced equity round with our series. A we grew you know significantly it was twenty plus percent every month. Um and and and really you know? Ah, we’re able to to focus on on what titan’s doing for customers.
Alejandro: So now talking about what titan is doing for customers and talking about also the future imagine you go to sleep tonight and you wake up in a world maybe like five years later where the vision of titan is fully realized what does that world look like.
Clayton Gardner: Had the world look so you wake up you open your mobile app we at 5 years I was going to say maybe it’s your vr headset depending on what zuckerberg is cooking up but let’s see you open your vr ah headset you open your mobile phone. Ah you see the Titan logo on whatever this ui is. Click it and it’s effectively push button get invested with the smartest money managers in the world. That’s it. That’s the vision. So that’s you can think about that and there’s two sides of that. There’s hopefully millions of customers that are expressing that push button get invested with experts on the other side of that is experts from every walk of life. From every asset class from every part of the world. So you have a guy or a girl managing your money in real estate managing your money in public equities managing your crypto portfolio. Maybe they have you invested in a portfolio of Nfts as controversial as that may sound a portfolio of fixed income and so on and so forth. Um, you can also go into art wine collectibles and so forth so many many assets across the world are going to be investable. Some of them I’m a big believer in others I think are more speculative or more collectible or more of novelty in nature. But I think what the world needs is more people being able to access the authorities. In those investing asset classes and the goal of tighten in 5 years as you wake up, you have the easiest way to connect and build relationships with those authorities.
Alejandro: Very cool now. Imagine I put you into a time machine and I bring you back in time back to 2017 when you are thinking like what are we gonna be launching here. Imagine you had the opportunity of sitting down with your younger self and perhaps you know with with your founders too. Cofounders and you had the opportunity of giving yourself one piece of advice before launching a business. What would that be and why given what you know now.
Clayton Gardner: Um.
Clayton Gardner: I’ll say something that’s it’s very it’s very Yc. It’s it’s the core essence of their motto. But I’ve never heard better advice in my life which is make something people want the amount of times that that core piece of advice and I’ll extend that maybe more broadly. Ah, focus on make something stakeholders want so whether that’s employees like what culture what compensation structure what career growth and ladder whether it’s to our customers. What features what products do they want ah was to our investors understanding the narrative. How this company could should look how to present that how to pitch that how to communicate that the world and just focusing on asking the stakeholder. How do you view the world internalizing that and then iterating and acting on it is like by far the most useful advice I mean that’s how he found product market fit it was Clayton Gardner: joe max you know stopped sitting in a room. Trying to think of smart startup ideas go out in the world. Ask people about their problems jot them down hack something together ship it iterate learn a test and that also applied to the investing or the the fundraising Journeyer here’s Clayton Gardner: Joe Max don’t sit in a room and create a really nice Mckinsey you know I give Joe. You know, Mckinsey’s amazing firm I give joe you crowd about this all the time because you know we were sitting here thinking this perfectly beautifully designed deck is gonna we’re gonna raise so much money. It’s going to be amazing crickets right? and it’s because you’re not focusing on what investors want to see and not what what they want to see about how to speak their language. Um, so just getting out in the world. And experimenting iterating is um, you know frankly I think that’s where a lot of public larger companies. Go wrong. Is you kind of lose that ability to innovate and iterate and ship and that’s why I love you know Bezos is saying of you know, kind of time to invent and wander I think like you want time to invent and wander but you need. To be able to fail and experiment and so I’d say making something people want or making you know, understanding. Ah you know stakeholders and investors customers employees and and just listening and I think ah, there’s a lot of impetus especially from the world I come from and finance to control to like do to act. And think a lot of time. The best inaction is the best action is in action. It’s just kind of sitting back and absorbing and listening to others and letting that inform what you do.
Alejandro: Wow I Love that the best action is inaction very profound I Love that Clayton Gardner:. So for the people that are listening. What is the best way for them to reach out and say hi.
Clayton Gardner: Well I’ll do a shameless plug. Everyone should check out. Http://titantitan.com you can reach our investor relations team myself any of our of our team through the app I’m on Twitter I I don’t post a lot I consume it daily I think it’s an amazing source of information. But. You’ll see titan it and myself do occasionally post so you can find me on Twitter my my handle is at virtual Clayton Gardner:. Um, and yeah, it’s been an absolute pleasure to chat with you Andre.
Alejandro: Amazing. Thank you so much fake Clayton Gardner: for being on the dealmakerr show today. What an honor.
Clayton Gardner: Thank you very much and a pleasure.
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