Earning

I dropped out of business school to start a company during the 2008 recession: Here's what I learned

LearnVest and Inspired Capital founder Alexa von Tobel shares the three lessons she learned from starting a company during the Great Recession of 2008.

Alexa von Tobel
Twenty/20

In 2008, just as Lehman Brothers collapsed, I dropped out of business school to start a company. It was a risky move but I knew that my idea for LearnVest, a platform that would deliver accessible financial planning advice to people across the country, was more critical than ever before.

Looking back, it was the core mission behind LearnVest and my obsession with it that powered me through every obstacle that came my way and taught me firsthand what it means to be a "recession entrepreneur." 

As we are in the midst of a new era of financial uncertainty, I've been leveraging all of the lessons I learned from over a decade ago, both in how I lead my team today and how I support the start-ups we invest in through my venture capital firm Inspired Capital

Don't be afraid of making the hard calls 

One of the most important lessons I learned was that you've got to make the hard calls now. I call it "leaning into the pain." Not making a decision is a decision in and of itself. Waiting five days or one month to make a tough call isn't going to lessen the pain. In fact, it often makes it worse. 

At LearnVest, I had to make tough decisions over and over again. One that stands out in particular was ensuring we were building our platform with the best possible tech platform. What LearnVest 1.0 was built on may have been ideal when we started and launched our beta product, but to scale effectively, we needed to change some of our infrastructure to better serve our quickly growing audience. 

Doing so was a major investment of technology resources and meant that a large portion of our team would be working consistently behind the scenes on improvements that wouldn't be immediately obvious to our audience.

But the quicker you can make decisions like these, the quicker you're able to get the right next steps in motion. 

Alexa von Tobel is the founder and managing partner of Inspired Capital.
Courtesy Alexa von Tobel

As a leader, you have to take down roadblocks piece by piece. You won't always have all the solutions. But tough moments give you an opportunity to build the fabric of your team's DNA and ensure that it's one of perseverance.

For many decisions, you can share your thought process with your team and invite them to find solutions alongside you. Tough times often help to create a workplace culture with the tight personal bonds you form from overcoming obstacles together as one team. 

Build a community that will help you through the tough times

It doesn't matter where you are in your career journey from intern to C-level: Surround yourself with people you can rely on and learn from. People imagine mentors to be older and often underestimate the importance of having peers who you can be candid and vulnerable with. 

This community of people with similar experiences gives you the space to talk about the ugliest and hardest parts of what you're going through while encouraging you to face your challenges head on.

When I was in my darkest days at LearnVest — whether I was working through a challenging product launch or grappling with a management question — one of my first phone calls was my friend Lucy Deland, who was building Paperless Post at the same time. There's no one more level-headed, thoughtful, and supportive to take advice from. Those are qualities that are critical when you need a sounding board and someone to help you work through a thorny problem.

Not making a decision is a decision in and of itself.
Alexa von Tobel
Author of "Financially Fearless" and "Financially Forward"

Because our companies were at similar stages, we spoke the same language and could help each other see ahead to the next hurdle. I didn't have to explain how I was feeling, because she was feeling the same things too.

She's now one of my partners at Inspired Capital, where we get to be in the trenches together every day.

Channel your conviction 

One of the biggest lessons I learned from starting LearnVest during the 2008 recession is that it is your own personal conviction, the fundamental belief that your company needs to exist, that will get you through the hardest times, not external validation from the outside world.

When I first pitched LearnVest to investors, I got tons of "nos." But I believed in my vision and kept taking meetings until I got to people who said "yes" and took a chance on me.

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Companies can fail for a number of reasons. But in my experience, two of the biggest ones are either the founder gives up or you run out of money.

Let's take giving up off the table. When you decide to start a company because it's an idea that keeps you up and night — not because you feel like it's something you should do — that gives you the drive to push through and persevere. 

My experience starting LearnVest taught me invaluable lessons about getting through turbulent economic times. Now, as we start to think about what work will look like on the other side of the pandemic, my venture firm Inspired Capital set out to explore what the future of work might look like so that we can set ourselves up to thrive in the face of our new normal.

Alexa von Tobel, CFP, is founder and managing partner of Inspired Capital and the New York Times bestselling author of "Financially Fearless" and "Financially Forward." Prior to Inspired Capital, Alexa founded LearnVest in 2008 with the goal of helping people make progress on their money. After raising nearly $75 million in venture capital, LearnVest was acquired by Northwestern Mutual in May 2015 in one of the biggest fintech acquisitions of the decade. Following the acquisition, von Tobel joined the management team of Northwestern Mutual as the company's first-ever chief digital officer, overseeing digital strategy. She later assumed the role of chief innovation officer, through which she oversaw Northwestern Mutual's venture arm.

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