From Being Fired to Bootstrapping a BILLION Dollar Company 💸 (#36)

Tim Chen was born in 1982 in Oklahoma to two computer scientists. He grew up in Houston oscillating between math/science competitions by day and sneaking out of his house by night.

At 17, he got into Stanford where he met many friends that later went on to start successful tech companies. Tim dreamed of being an entrepreneur one day. But couldn’t resist the excitement and $ of Finance.

After a short stint at an Investment Bank, he landed a job at one of the most prestigious hedge funds.

2 years later...

It was 2008. The global financial crisis was underway. In Sept of 08, Chen watched in horror as Lehman filed for bankruptcy. In Dec of that year, right after Christmas, he got a pink slip.

FIRED.

He had no idea what to do next.

Half of my friends in finance were unemployed... We would go to Dave & Buster's in the middle of the day, what else was there to do?

His family, realizing he had all this free time, started asking for help with financial decisions. His sister wanted him to research a new credit card for her. His parents, a mutual fund.

With nothing better to do, he started googling. What he saw and found made him sick to his stomach. All that existed were a bunch of websites trying to sell him something. Everything was biased. The information was shallow.

He thought it would take 3 mins but instead it took him a whole week to gather the information and build a spreadsheet comparing various cards in a "clear and unbiased" way. His sister loved it. She forwarded it to friends who forwarded it.

One day a friend of a friend met him and said “oh yeah, you’re the credit card spreadsheet guy…”

Tim started to see an opportunity…

What if he could build an unbiased website for financial products?

Something to really serve the little guy. He built a directory of credit unions. But it got no traffic and barely any links.

He decided he would “just” write high quality articles and begin posting them to his website.

✔️ NerdWallet dot com

The first year was brutal. The company spent $800 on domain + hosting. And generated revenue of $75 in 2009.

Tim spent 16+ hour days writing articles, begging for links and convincing friends to write articles for cheap/free.

He was lived off $5 footlongs while his girlfriend paid the rent. The next year (2010) started slow but then the table turned.

Tim woke up one morning in June and traffic was up 5X! He checked his tools and realized his content was finally getting ranked by Google.

He saw 3x monthly growth as Google realized he had the best credit card content online. The company started generating real revenue.

While Tim reinvented the content model, he stuck with a classic revenue model: affiliate marketing. Credit card companies get >40% of their customers via affiliates. Many are willing to pay >$300 for a qualified customer! By 2013, business was booming.

Estimates have it in the low 8 figures of revenue that year. Tim should have been celebrating. Instead, he was going through one the toughest periods of NerdWallet’s history.

Tim had hired lots of “wall street” types and some were not adjusting well to startup life. Each leader had their own vertical "Biz Unit". But some were acting like as if they were still on Wall Street. Competitive and territorial with a zero sum mentality.

To compound the issue they had hired people like them. Finally, at the end of the year, Tim did what was necessary. He fired 20% of the staff. Tim delivered the news to those who remained. While they weren’t inspired by his words, they were inspired by his actions.

💰 Wealth Z 💰

He hired executive coaches, changed the org structure, and routinely let people go when they didn’t fit the culture.

By 2015, the company was doing >$60M in revenue. Nerdwallet was growing fast, but Tim was still barely holding on as CEO. They had inquiries from venture capitalists before, but they weren't good fits.

Eventually he found his perfect match in IVP, and raised $65 million. This new capital allowed them to start building apps, tools, and tons more content to help their customers.

In 2017, another culture shock rippled through the company after they missed revenue targets and 11% of the company was laid off.

Tim saw this as a leadership failing that started at the top

I needed to evolve from a scrappy, seed stage founder to a more professional executive, which required several seismic mindset shifts. Essentially, I needed to do the work to get out of my own way.

That work paid off when after 12 years of building Nerdwallet IPOd.

In 2021, Nerdwallet posted a $300 million+ revenue juggernaut in financial literacy, tools, and content. Tim retains full control with a net worth of over $900 million. For Tim, this is just the start of a mission to increase financial literacy worldwide. He's in for the long haul.