Davis

@davis1

Founder Interviews: Lucas Liew of AlgoTrading101

September 28th 2018

Learn how Lucas Liew scaled his online course for algorithmic trading from 0 to 30k students.

Davis Baer: What’s your background, and what are you working on?

Lucas Liew: Hey guys. I’m Lucas Liew, founder of AlgoTrading101, an online course for algorithmic trading (i.e. trading using code).

Essentially, we teach our students how to generate, code and execute their own trading ideas.

We have almost 30k students from 160 countries at the moment.

What motivated you to get started with your company?

I was trading at a proprietary trading firm when I started AlgoTrading101 as a side project.

The first version of the idea was to sell code templates for trading robots. Customers can then build their own trading robots by editing these templates.

Bad idea.

Turns out no one wants to pay for templated code (especially when there is plenty of free code floating around).

We then pivoted to an online course for algorithmic trading.

There were (and still are) many “get rich quick” trading courses around. Our angle was to appeal to those who were not looking for a quick buck, or who had tried those “get rich quick” schemes and failed.

What went into building the initial product?

We tried to validate the idea by talking to “users”, aka my friends who were in the finance industry.

Their feedback was honest but bad. My friends were genuinely concerned for me pursuing this idea.

In hindsight, my friends weren’t my target audience. We should have spoken to those seeking a career change, or college undergraduates looking at trading as a possible career path.

We went ahead with the idea anyway. The plan was to launch fast and get feedback from the market directly.

Our initial investment was $100; it was a Blue Snowball microphone.

The launch was supposed to happen within 3 months, but self-doubt and a massive underestimation of the work required dragged that out to 7 months.

It would have been much longer had we decided to perfect the course. We launched (with much hesitation) a scrappy version of our course.

We should have launched earlier.

Coding and testing a trading robot

How have you attracted users and grown your company?

We got lucky.

We decided to launch on Udemy (an educational course marketplace) instead of our own hosted site. Moreover, we launched right before their massive Black Friday sale.

We didn’t even know that they had a Black Friday sale.

By leeching off Udemy’s user base, we had sales on our first day of launch. By the end of the first month we had over a thousand students.

Thousands of free coupons were given away in the following months for publicity, reviews, and feedback. This helped us become one of the top courses on Udemy for algorithmic trading.

What’s your business model, and how have you grown your revenue?

We managed to grow our revenue by 10% month-on-month for the first 24 months.

We got traction from content marketing and press exposure on other platforms (such as Quora and Investopedia) and SEO.

For SEO, it took us about 2 years to rank first for “Learn algorithmic trading”.

Unfortunately, revenue plateaued as we let our foot off the gas for SEO and content marketing efforts to look at new products, which didn’t contribute to growth.

In those first 24 months, our pricing strategy contributed to our growth.

We were raising prices regularly to find our optimal price point. For customers who were on the fence, this tipped them over.

Our prices started from $49 (for lifetime access) in 2015 and now it is $570, but we have also added significant amount of paid content during this period. Prices were raised yearly.

We usually see double the revenue in the month before a price increase as compared to an average month.

If your product doesn’t solve a “hair-on-fire” problem, you will get plenty of resistance at the last mile. Having some sort of urgency to purchase your product will help greatly.

What are your goals for the future?

We joined Y Combinator’s Start Up School 4 weeks ago.

With the guidance of our YC mentor Igor, revenue has been growing at 20% week-on-week. Time to keep the momentum going!

The current focus is on SEO and content marketing.

After which, we will be looking to create more courses and online tools in nearby verticals, like machine learning for finance.

What are the biggest challenges you’ve faced and obstacles you’ve overcome? If you had to start over, what would you do differently?

Changing my mentality made a big difference.

AlgoTrading101 started out as a side project. I never thought of it as a “real” business until many months after its launch.

Once we sat down and decided to focus on this business, we pushed it to grow more than we had ever thought possible.

Some things I would do differently:

  • Launch (much) earlier
  • Presale my product
  • Focus on building an email list of happy users
  • Be consistent about content marketing
  • Launch more courses in verticals close to my niche

To those of you running a side project, treat it like a real startup!

Have you found anything particularly helpful or advantageous?

Former VP of Growth at Facebook, Chamath Palihapitiya, once talked about how they thought of growth at Facebook.

The framework:

  • Get users through the door
  • Hit them with the “Aha” moment (within seconds)
  • Deliver core product value as often as possible

To stand out from other courses, our course had to deliver value as often as possible.

Most other coding courses tend to teach serially, starting from tons of nitty-gritty basics, followed by mundane coding exercises.

Our aim was for our students to feel good about their achievements within the first day.

Thus, we arranged the course in a way so that most of our students could code their first robot in one day.

This made them engaged, happy, and motivated enough to push through the harder parts that would come later.

What’s your advice for entrepreneurs who are just starting out?

1) Minimise the duration of your feedback loop.

You need a fast way to know if what you’re doing works.

Put something out there ASAP to gauge interest. Spending 7 months building an MVP without feedback is dangerous (I got lucky).

2) Money is the best validation. Not sign-ups, free trials, or press coverage.

3) When in doubt, charge now and charge more.

Where can we go to learn more?

To learn more about AlgoTrading101, check out AlgoTrading101.com.

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