How I Built This with Guy Raz - ICYMI... HIBT Lab! The Financial Diet: Chelsea Fagan

Episode Date: January 5, 2023

Chelsea Fagan got her first credit card when she was a senior in high school. She quickly maxed it out, racking up debt that would burden her through her early twenties. Then, in 2014, Chelsea started a blog as a way to keep track of her spending habits and get her financial life back on track. She called it “The Financial Diet.”This week on How I Built This Lab, Guy talks with Chelsea about how she turned that blog into the multimedia personal finance business it is today. Plus, Chelsea shares why she prioritizes employee satisfaction over growth and explains her judicious approach to brand partnerships.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

This podcast is brought to you by Squarespace. I talk to entrepreneurs all the time who are looking for a way to upgrade their digital footprint. Well, whether you're just starting out or you're scaling your business, Squarespace is the easiest way to build a great website that stands out. It's an all-in-one website platform that gives you everything you need to claim your domain, showcase your products, and get paid. Anyone can use Squarespace's cutting-edge design tools to build an online presence that truly reflects what makes your business special. There are templates, intuitive drag-and-drop editing, and even an AI-enhanced website builder. Then, Squarespace's built-in analytics tools help you make smarter business decisions. Review website traffic, learn where to focus engagement, and track revenue all in one place.

Looking to grow your business, Squarespace even offers fast, easy business financing through Squarespace capital. Go to Squarespace.com slash built for a free trial. And when you're ready to launch, use offer code built to save 10% off your first purchase of a website or domain. Loans issued by Celtic Bank and serviced by Stripe. All loans subject to credit approval. This show is in partnership with Airbnb. This past summer, I took my family to Vienna, and it was incredible. We spent our days wandering the old streets, stopping for coffee and pastries,

visiting museums, and just soaking up the history of one of the most beautiful cities in the world. And one of the things that made the trip so special was the whole. home we booked on Airbnb. It had tall windows, beautiful old details, and plenty of space for all of us. And being in that home on Airbnb, right in the middle of Vienna, walking distance from so much of the city made it feel less like a visit and more like we were actually living there. Plus, taking a trip is the perfect time to host your space on Airbnb. Your place, with all of its personal touches and its amazing location, could make someone else's vacation even better. Your home might be worth more than you think. Find out how much at

Airbnb.c.a.com slash host. Hello everybody. Happy holidays to you. This week, our production team is taking a quick break, a much-deserved break, because we produce 88 episodes of this show every year. And so they're taking a break to spend some time with their friends and families. So this week on How I Built This Lab, we're going to bring you an episode from our archives that aired back in July. And since the New Year is kind of a time for us to make, you know, resolutions. We thought, you know, why not some resolutions around money? So we decided to re-air this interview with Chelsea Fagan of the Financial Diet. Chelsea hit her financial rock bottom in her early 20s.

And so she resolved to kind of crawl out of it by tracking her personal spending and then writing a blog that eventually turned into a multi-million dollar media brand that now helps other people take control of their finances. So if you want to learn more about your finances or you want to learn about how to build a business, here's the episode for you. Hello and welcome to How I Built This Lab. I'm Guy Raz. The Financial Diet is a media company that offers up personal finance advice. It started out as a blog back in 2014 when Chelsea Fagan was trying to get her own financial life back on track after racking up credit card debt and developing bad spending habits in our late teens and early. 20s. Eventually, her blog turned into a video blog, a newsletter, a podcast, and live events. And today, the financial diet, or TFD, for short, is a multimedia business with more than 10 employees and multiple revenue streams. But unlike many of her competitors in the space, Chelsea

Fagan has some pretty firm rules. She doesn't promote crypto, and she's not obsessed with growing the company or even growing her audience. Her goal to build a sustainable and manageable business. Chelsea Fagan, welcome to the show. Thank you for having me. All right. So basically, you've written that you, quote, destroyed your financial life between the ages of 18 and 22. What happened to you during that time?

What was going on? Yeah. So just for a little background. So I lived until the age of about 11 in Charlotte, North Carolina. My family was definitely low income at that time. We lived in a pretty low income community. And I've often sort of made the observation looking back that being low income in a low income community, you actually in many ways don't really feel your kind of socioeconomic status very much. But we moved around that age to Annapolis, Maryland, which is an extremely affluent community.

and I went to school and socialized with a lot of people who were very, very wealthy. You know, it was very common for kids at my high school to get new BMWs for their 16th birthday or, you know, take lavish trips to Europe in the summer and all that kind of stuff. And we were more middle income by that time, definitely still not wealthy by any means, but we were definitely in a better financial situation by my high school years than we were when I was a kid. but because I was comparing myself and surrounded by such high levels of wealth. I mean, I also worked at a yacht club, you know, often serving in very expensive restaurants. Like, because I was in that kind of context of wealth, I actually felt much poorer than when I actually was much poorer.

But I had a huge amount of kind of insecurity and shame around money. And typically people who grow up with those kind of money issues, it usually goes one of two ways. They either become big spenders and are very compulsive with money, which was my case, or you become kind of a hoarder with money and very obsessive and often overly frugal. Yeah. But I was a very compulsive spender, especially on things that felt like they conferred status, you know, clothing, restaurants, travel, image kind of based things. Stuff, basically. Stuff, yeah, and stuff that felt very specifically tied to that ideal of what a wealthy person was. By the way, not unusual for an 18 to 22 year old.

It's not an unusual thing to do. No, it's not. I think, but unfortunately, my senior year of high school was still pre-crash of 2008. So they had, like, Bank of America and other, you know, banks had, like, booths set up. in our high school to get you a credit card. Zero percent financing, like, right? All kinds of stuff like that. Exactly.

And so I got a Hello Kitty branded Visa credit card, maxed it out basically immediately, and then threw them the garbage and never opened my mail. You were like, that's it. I don't have to pay. I maxed it out and that's it. Exactly. You know, obviously decimated my credit score, went to collections. I was constantly overdrafted, having to use check caching service.

because I owed so much money to my bank, constantly, constantly sort of running from my own financial mess for sure. And you were working at the time? Oh, yeah. I was always working full time, often more than one job. All right. So you had mold this debt and I think even like unpaid traffic tickets and. Oh, yeah.

Got my driver's license suspended. And it's important to say this because there's a lot of shame around it, right? when we're, especially when we're young, we hide these things because it feels like it's embarrassing, but I think it's extremely common, especially for young people to experience this because we don't learn financial habits when we're kids. And so oftentimes, many of us find ourselves in that position. Absolutely. Yeah, I mean, you mentioned the tickets. I mean, I got arrested because of, you know, my financial problems because it led to me driving on a suspended license and all that stuff. And,

for a long time I didn't talk about any of these things even after I had sort of cleaned up my situation because of that, you know, embarrassment that you're talking about. But I think, you know, especially as it pertains to money, so many people are raised in such an extreme level of taboo with regards to money. Yeah. Whether they have it or they don't, you know, a lot of people are raised not to talk about it. And for people for whom it was a source of stress, all the more so. But I think for me anyway, I, it's, almost sort of felt like a superpower to be so candid about money. Because you really feel like when you're able to own that stuff and to sort of be unashamed, nothing scares you, kind of.

Yeah. All right. So you find yourself with this debt, but also you're working. And you start to do some writing around this time when you're in your, I think, early 20s. What were you writing about initially? Any and everything, you know, it was also the area of the internet where people were heavily encouraged to write about their personal lives. So, you know, I wrote listicles. I wrote essays about life. I wrote some rather embarrassing things. Honestly, I wrote a book at that time that was, you know, kind of similarly positioned. But yeah, I certainly wasn't writing about money. At the time, you were doing a lot of writing for thought catalog, which is an online publication geared towards millennials. And it sounds like it was a pretty good opportunity to just kind of get your feet wet, even if, as you say, it was stuff you're not super proud of.

I mean, you were writing, right? Yes, writing for sure. And I think once I was able to write things that I felt more strongly about what it definitely gave me was, I mean, I easily write 5,000. words a day because I'm just like so used to cranking out content. And it definitely, I mean, I started out as a writer there and by the end I was the creative director for all of the branded contents. I was in charge of like all of the content that we were doing in partnership with brands to kind of pay the bills. So it did give me a really, really clear view into how to make money on media, which obviously proved useful later. Yeah. I mean, it's, I think it's instructive

because a lot of, especially young people who are starting out, they don't know how to break into journalism or media or content creation. And there are outlets. But how did you even get in? Was it relatively easy to start writing? Easy, I don't know. I think, I mean, I just cold pitched an article and it got picked up right away. In the first article I wrote went viral and I had several. But what was the article? What was the first article called? Do you remember? Now accepting boyfriend applications. And it was a list. of criteria. It was very snarky, I would say almost kind of mean. And I still, to this day, get some disgruntled men writing to me about it. And I actually met my now husband. Our first date was the day it was published. So talk about Kismet. But, wow.

Accepted that application. But so, yeah, that went viral. And I mean, I wouldn't say it was difficult, but I will say, I mean, I'm pretty candid about the fact I was writing for some pretty established outlets in the first year of writing. And for a long time, I wasn't paid for anything. I wrote for free for quite some time. Many, many, many, many articles. So in that sense, it was just, you know, a bit of a slog because, you know, I was going to school at the time in France and I had a full-time job. So that was hard. So, all right. So you eventually become, as you say, the head of branded content at Thought Catalog. And I should mention while you're there, you put out a couple of books. And I guess at a certain point, you start a Tumblr blog, and you really start to kind of think and write more about personal finance. How did you start to kind of write about it and think about it? What was the impetus? Was it your own experience?

Yeah. So when I sold my first book, I got in advance of $22,000, which at the time was lottery amounts of money. Yeah, that's great. It was life-changing for me at that time. And it was the first time not. only that I had that kind of money, but all at once. And so the first thing I wanted to do was pay off my debts because I basically couldn't use my phone anymore because of all the collection calls I was getting. And so I paid it all off. And by the time I was 25, I was living in New York. And I, you know, I had a little in savings. I was making a very low salary at that time. But I was still combined with my now husband's income, you know, I was able to pay my bills. And And I felt like I had the ingredients to be an adult financially, but I was only just sort of like making the bare minimum. So I started a Tumblr at the time, a personal blog, to hold myself accountable to kind of improving my relationship with money. And that's how I started doing it.

And when you say hold yourself accountable, it was, you essentially were putting all of your sort of spending habits out in public in order to make sure that. that you didn't do something irresponsible? Yeah, and also to kind of create a support system around it and talk to other people about it and feel less, you know, anxious. This was a Tumblr blog that was called The Financial Diet. How did it over time that blog become a blog about personal finance that anybody could relate to? So on like the third day of operating TFD is just, you know, a personal project.

My co-founder, Lauren, who was working at an ad agency as a designer at the time, emailed me and said, hey, I love your work. I really love this blog idea. I'd love to redesign it as kind of material for my portfolio. I'm trying to branch out. She wasn't in love with her job either. And so she redesigned the whole thing for free as kind of a project. And then a few months later, John and Hank Green, who are authors, YouTubers. They have a very, very large YouTube video production company, mostly in the educational space.

They reached out to us because they have a kind of like a, it's like a foundation essentially that gives grants out to things on the internet that they like and want to see more of. So they sent us $5,000, which again at the time was like, oh my gosh. And also, I mean, you know, it wasn't just the money. It was they shared us and they were kind of institutionally supporting us in that way. So we kind of took that as, okay, like, let's give this a try full time. We use that money to kind of set up the company legally and structurally. And we were both still, like I was

freelancing quite a bit through that first year. And she was also freelancing and doing some, you know, kind of catering jobs and whatnot to just kind of make the bills. But it was a pretty quick and precipitous transition. I mean, looking back, I don't know what I was thinking. I was like on my work computer in the office, like spending all day working on my personal blog. And I was like, okay, clearly this is what you want to be doing. We're going to take a quick break. But when we come back, how Chelsea Fagan turned a blog into a business. You're listening to How I Built This Lab. Hey, welcome back to How I Built This Lab. I'm Guy Raz. And my guest is Chelsea Fagan, founder and CEO of the Financial Diet. So you at this point with this grant from Jean-Raez, and I'm

on Hank Green, it's clear the financial diet will no longer just be a written blog, but it's going to be a video blog as well. Is that right? So that was about a year later. We kept in touch with Hank. I met up with him in New York for dinner. He basically was like, have you ever thought about turning this into videos? And I was not really even a watcher of YouTube at the time. I didn't know anything about it. And I was like, maybe. Why not? And he goes, well, you know, we have this production company. If you come on, we'll give you the resources, teach you how to make videos, teach you, you know, the back end of YouTube, all of that, send someone out to New York to film you guys, the side and the other. And, you know, we did a rev share. So for the first two years of

having a YouTube channel, we were a co-production with Complexly, which is their YouTube production company. And then a few years into it, we went totally independent. and took it all back in house. And to their credit, I mean, Hank is just very few people on the internet are as, like, decent a human being as he is. But they were very generous about making sure that we got all the IP and all of our rights and all, you know, keep 100% of our money and all of that. So it was, we couldn't have landed on better people in that regard. So as you kind of pivot towards video and obviously continue. to write, did you and Lauren start to map out what you wanted or what you imagined the

financial diet could be? Not really. I think so I worked at Thought Catalog with our third partner. We have a third partner. And she worked in the branded content department. So she was very responsible for getting clients and building out ad campaigns, which is how we make the majority of our money. And so she had left and was working at a nonprofit. And I had reached out to her, this is maybe a year into our existence, maybe a little less. And I said, you know, we're really looking to kind of build this out into a proper business. Do you want to join in, help us out? So she started for that first year or so nights and weekends. She got like a monthly stipend plus commission on everything she brought in. And of course some ownership in the company. But she really

was the one who came on and sort of mapped out the business end of it. And so you've got this essentially a personal finance media company that you're kind of building, but sounds like you're not quite thinking of it as a media company, at least initially. No. I don't think I was, but I also, like I said, I mean, I had enough experience in the monetization aspect of it that from day one, I had a pretty keen understanding of how to turn content into money. I think really the infrastructure of a business is what came later. So let's kind of break some of that down.

First of all, in terms of your audience, right, who was coming to the site? Do you have a sense of who your audience is? We're a very demographically narrow company, very niche. Well, I mean, listen, it is only in the world of personal finance are women considered a niche. I mean, we are the majority of the population. But our audience is almost exclusively women, which especially when we started was very unusual in the personal finance space. 18 to 40? Yes, but with the largest section of that by far being like 25 to 34 in that sort of like, you know, young,

adult really getting your S together kind of phase of life. They're also generally professional in some capacity, generally have at least a bachelor's. Huge amount of them have postgraduate degrees, tend to be clustered in urban markets. But, you know, it's a very specific type of woman. And I mean, you know, it's important to state that even a woman who is educated, has money, works, full time, etc., on average, women are still not the financial decision makers. They make day-to-day decisions in the household, generally, but they're not the long-term financial planners of heterosexual couplings. So the type of woman who is really interested in, like, building out her own investment portfolio or managing her own retirement or buying a house and kind of leading that process, even amongst women who demographically fit the bill, it's a pretty self-selecting group. You know, I'm curious how you educated yourself around personal finance. You know, I was a foreign correspondent early in my career. I covered conflicts and wars. I had no background in finance or entrepreneurship. It was only in the last 10 years that I started to learn about it and then start a show. And now, you know, thousands of interviews later, I have a pretty good, you know, grasp and understanding of how it works. But it took time for me to understand it. How did you. you teach yourself about personal finance?

Kind of by osmosis. I do take pains to say that I'm not a financial expert. I don't have certifications. I don't have my Series 7. I'm not a CFP, none of that. So we contract out to a lot of them, and we have great relationships with a lot of actual subject matter experts

that we work with quite frequently. But, I mean, I look at the model that John and Hank have with a lot of their content where they're really, they're communicators, their educators. Their job is to translate these ideas, not to be themselves, scientists, or what have you. And so I really sort of look at myself the same way in my relationship to personal finance. And so I think in some ways that relieves me of the responsibility of like, I'm not out here giving people individual advice, you know, and especially when it gets to the more

esoteric stuff, we pass that off to real experts. And I think what I want to, to stress to our audience more than anything is that this isn't hard. This isn't difficult to learn. It's not complicated. Anyone who's trying to make finance personal finance sound complicated or like if there's a lot of math in it or things like that, they're probably just trying to get money out of you. Because there's really not that much to know, honestly. Spend less than you make. I mean, there's really not, you know, there's only so many ways you can say it. Yeah. Spend less than you can make. The rest is commentary. Exactly. I love that. You mentioned that you have a niche audience, and I want to sort of mind that for a moment because the quote unquote niche audience that you have, women 24 to 35, is probably the most valuable audience from an advertiser's perspective on Earth, right? It's a highest spending audience. Media companies want women between the ages of 24 and 35 to be listening or watching their programs. It's an incredibly valuable audience.

but you make the point that you don't need to make a program with mass appeal because you can actually have a successful business by appealing to this very specific audience. Exactly. And I think something that I learned early on working in media is that, you know, if you're dealing in scale, you're in a race to the bottom. There's no two ways about it. I mean, the era of the Facebook click content farm, that kind of stuff, most of those companies are gone. But even the ones that survive, I mean, they rely on what's called programmatic advertisements. So things like the automatic ads that play before a YouTube video or the banner ads that you see on websites, things like that. And what counts there is just maximizing eyeballs. And the value per eyeball is super low. So you got to do clickbait and you got to publish scandalous stuff or really sloppy stuff or, you know, comment on trending topics you have no business speaking on.

And for us, the value of an ad that we do per person, even setting aside the demographic value, which is high, is so much higher because there is a level of quality. We're speaking about money already. So if our advertiser is in that space, you have the most direct relationship with that consumer. We want to maximize the value of each piece of our content and each person in our community. And that's never, ever going to happen by casting as wide a net as possible. I don't want to speak to everyone.

One of the things that I really like about this era of content creators is that when I started out in media, you couldn't do that, right? You had to go through a major media company to have a platform. There was no other way. And that, of course, has changed dramatically to the point where you've got, you know, people who have hugely significant, quote-unquote, media companies through YouTube channels. And one of the things that I've noticed that you've done is you kind of walk your viewers and your readers through how you can do that, how it's possible, to do it. You actually wrote an article in 2017 called How TFT Actually Makes Money, which I thought was really interesting. I read it. It might be probably a little bit outdated today,

but basically you broke down how your business is sustainable. Can you kind of give us a sense of what your revenue streams are? Yeah. And how it works? Yeah. So the largest segment of our business by sort of product or platform are our events. So that's classes, workshops, conferences, things like that. It used to be all in person. We did all digital for the pandemic. Now we're doing kind of a mix. And within that, there are about half that are ticketed.

So we're selling direct to the consumer or the other half is in partnership with a sponsor, a corporate sponsor. And usually those are free to the audience. So just in terms of scale, that's the biggest part of what we do. Second to that, pretty close second is YouTube, obviously a big, part of what we do. And that's the pre-roll ads that run before your video? Well, that and almost every video we do has a sponsor brought to you by. Right. It's baked in. You are or the person who's doing the video will say thanks to our sponsor, whatever, Squarespace for whatever, whatever, whatever.

Exactly. And we actually double-dip. We have our pre-roll ads on and we have the corporate sponsor. And our audience, we have the best audience, I have to say. They're very kind about, you know, you got to get, you got to make your money somehow, ladies, you know. Yeah. So they're really sweet. So that's a big part of it. Our grand partnerships are also distributed throughout our newsletter, which is where we publish articles and social media and all of that. Outside of that, we also, we do licensing. We do, we have a membership program for, you know, exclusive content and things like that. So we try to be as diversified as possible, but, you know, at the end of the day media companies, there's only so many ways they can make money.

How do you, you know, when it comes to things like brand partnerships, for example, or, you know, content that is made on behalf of a client, how do you make decisions about where your red lines are? Yeah, it's tough. I mean, we have this conversation all the time. It's not a perfect science. Also, I mean, I hate to say it, but like in the world of financial social, services companies, you're going to have a hard time finding any of them that have a perfectly

unblemished past in some respect or another. So, you know, part of it is kind of a gut check. There are hard lines for us. We don't do weight loss stuff. We certainly don't do crypto, even though they flooded our industry over the past year with crazy ad dollars. And I'm sure you gave up a lot of potential revenue by not doing that. For sure, but I do think even financially it's in our long-term best interest. I mean, the personal finance people who were hardcore shilling crypto to their audience, they saw serious blowback from their audience, especially now. And what about, as you say, there are a lot of financial companies and companies that are

selling financial products that really want your audience. They want young people, they want young women, whether it's Fidelity or E-Trade or Robin Hood or, you know, I mean, I'm just mentioning a few, but there are tons and tons of options out there. How do you, how do you handle that? Well, I mean, you just have to disclose that it's an ad, right? And I mean, we disclose for financial services companies that we actually use all the time. You know, we've worked with Intuit. I've used to mint forever. We used to use QuickBooks for years at the company. You know, we have, we've done ads for robo advisors that our own team uses, all that kind of stuff. So there are things, in fact, the times that it becomes

most blurry is when we're advertising for people that we have organically and unprompted endorsed in the past. But I think, you know, obviously we're only working with companies that are above board and that we would use ourselves or do. But we're, you know, we're super careful about making sure to properly. It's a huge pet peeve of mind when digital creators and influencers don't properly disclose their ads. We're going to take another quick break. I'm talking with Chelsea Fagan, the founder and CEO of the Financial Diet. Stay with us.

You're listening to How I Built This Lab. Welcome back to How I Built This Lab. I'm talking with Chelsea Fagan. She's the founder and CEO of the Financial Diet. So you, in 2019, you tweeted that every employee, salary and full-time employee makes at least $60,000 a year, probably a little bit more now because that was a few years ago. Tell me about how you think about pay structure at TFD. Yeah, well, it is more than that now. But, you know, we are not a nonprofit and we're not a co-op.

However, we do kind of have a bit of a hybrid model where almost everyone in the company has some kind of base plus some sort of rev share commission bonus, et cetera. There are certain employees who prefer to keep their base low and they like to get a higher. variable compensation or vice versa. We also recently implemented a four-day work week without a pay cut, so that's effectively a 20% bump for everyone. We try to be very, you know, as equitable as humanly possible. The range of compensation in the company is pretty narrow. I'm smack in the middle of it, so I'm not even like paid more than everyone else, not by far. Because I think for us, for myself, certainly, and I think we've cultivated a team where what is most important, most valuable is work life balance. And, you know, we all have six weeks PTO. We have a pretty aggressive maternity leave,

all of that kind of stuff. And outsized compensation for executives really flies in the face of that. So by having that more co-op-like model, it really allows us to kind of have the best of both worlds. And it also keeps our employee retention basically forever, like no one leaves, essentially. So that obviously in the long term ends up saving us a lot of money in time. as well. How many people work for TFT now? 12 total employees and partners. And then obviously a ton of contractors. So that's a really significant number of people working. And you've been very transparent by your own finances, even, you know, which pay yourself. Can you give us a sense of what

the overall revenue for TFT is per year? Yeah. Well, we took a big old hit. during COVID, but this year we're probably going to end up somewhere between $1.5 and $2 million in revenue. Wow. So you've got a really robust business that started out as a Tumblr. And, you know, give me a sense of what your sort of vision for it is. I mean, you've got the YouTube videos. You've got the newsletter. You've got the events. How do you envision growing the company even more over the next five years? I think the difference is that I really just don't view growth as the metric of success really. Interesting. You know, it's nice to grow a little bit year over a year, but we've never taken on any investments, you know, outside investors because what they want

is growth. That's the most important marker of success. And I mean, that's capitalism, right? Like, the line has to go up. Sure. You're looking for sustainability. Exactly. Like, I would be very happy with like a 20% year over year growth rate, but like everyone has an awesome life and everyone's paid really well and we're making, you know, work that we really enjoy and we get to go home at the end of the day, you know, and keep our four-day work week and all of that kind of stuff. So, you know, as far as my role within things, it's been for the past several years, the trajectory has been making myself less and less financially necessary for the company, just for sustainability purposes and also like...

You as the face of it, you mean? Correct. And because also, you know, I just don't think that's... It's not sustainable, but also, you know, demographically, we want to have people of all kinds of financial experiences talking. So, yeah, I mean, I think at the end of the day, eventually, you know, I'm going to die. So if nothing else, that'll be the end of it for me. But I genuinely don't really think in terms of a five-year plan, mostly because with COVID, with how fickle these platforms are, with how quickly these things can change. I know.

that any plan that I have today for what our digital strategy or our revenue strategy will be in five years is probably going to be totally obsolete. It's almost like your strategy or your approach, rather, it runs entirely counter to the kind of hustle culture that you see among financial bloggers and YouTubers. A lot of them are get rich quick schemes or, you know, meme stocks and I'm generalizing. Of course, there are some outstanding financial advisors on YouTube and making podcasts, but many of them are not. And it seems like your approach is like we're fine with growing slowly. We're fine with having a smaller audience. We're fine with kind of being a bit under the radar. Oh, for sure.

I mean, also media is such a disaster zone of an industry. I mean, like half the companies that were around when we started in our space are gone. Basically, every media company has gone through layoffs, restructurings, pivoting to video, pivoting away from video. I mean, I have many, you know, friends and acquaintances in the industry, and almost all of them have had an incredibly turbulent past 10 years professionally. We've never laid off a single employee. And we've never had an unpaid intern. We've never had to do any of these things. Like I, even during COVID, you know, the level of job security that we all kind of get to experience is, to me, that is way, way, way.

preferable to, you know, being big and splashy and growing really quickly, for sure. A very different approach from another New York-based financial media company, The Morning Brew. They were on our show maybe a year and a half ago. And, I mean, it's a similar kind of model. But in the end, they took on a large investment. And so, you know, are now part of insider, whatever it is. I mean, is there a world where you would ever even entertain something like that? Probably not. We've gotten into pretty protracted conversations with several different potential investors who are either looking to outright bias or to invest heavily. And, you know, we even got to well into due diligence in one instance. And I think what I learned from all of those experiences is that there's no iteration of TFD that takes on investor money that doesn't kind of nuke the editorial and labor.

practices to some extent. It would just be such a compromise, you're saying? A thousand percent. I think personally I would feel like it was a huge betrayal to my team. Like in that instance, I feel like I would have to like offer everyone some money and be like, you know, here's the money. If you guys want to leave, leave because it's not going to be the same party, you know, was before.

But I just don't see a reason to do that, especially if I'm not even myself financially necessary to the company anymore. Like, you know, there's no reason. If it's not broke, don't fix it. And the kinds of pressures for not just growing quickly, but also maximizing profit, which we intentionally don't do, those would become insurmountable. Because if someone is investing in you, they want to see a return. And they have every right to want that. But then we're obligated to put profit first. And there's no way that the way we operate today could be sustained in a growth first, profit first model. Do you think that it is possible, so much competition for eyeballs, right? And much harder today to get attention than when I started in 2011.

Do you think that it is possible for somebody completely unknown like you were, you know, 10 years ago when you started, to create a YouTube channel today and turn it into a sustainable business? Of course. Yeah, of course I do. In some ways it's harder, but in some ways social media does. does make it easier for people to find what they like and to form communities. You know, and I think there definitely is more competition. But even just from like an ad dollars perspective, you know, when we were starting out, even YouTube wasn't taken that seriously by advertisers. We were having to fight tooth and nail for the scraps of ad dollars that were left over.

And now digital ad spend is where people are going first. Chelsea, as you know, there's been a lot more discussion over the role of capitalism and justice in our society, certainly over the last four or five years. And here you are. You're running a financial blog, a personal finance sort of advice company operating in a capitalistic system. But it seems to me that you have a rather more nuanced view of capitalism. Can you kind of outline how you think about capitalism? capitalism? Wow. Yeah, I mean, at the end of the day, like, I am a capitalist quite literally, right? Like, I'm not a very good one by sort of extraction of resources metrics, but I am a business owner and I am also an investor in the market. And there are many ways in which the life I live and the things I do are definitely a product of a capitalist environment for sure. And as someone who's sort of won at capitalism, I feel maybe not the most well positioned to criticize it. But I do think that the version of capitalism that we have in America is just needlessly harsh and destructive,

you know, keeps people in a cycle of poverty. You know, there are a million and one problems with the version of it that we have today. But I don't, I've never lived under communism so I can't, you know, or more literal socialism, so I can't say whether or not I would love it. But I do think that having a much more sort of regulated and infrastructureed capitalism with much, much more limits on wealth accumulation, much higher taxation, much more support and resources for lower income folks, all of that I think is absolutely necessary. Whether or not that's realistic for our country, I mean, I really don't know. I do think I personally see a lot happening politically, especially at the state and local level that I feel heartened by for sure. Chelsea Fagan is the

founder and CEO of the Financial Diet. Chelsea, thanks so much for coming on the show. Well, thank you so, so much for having me. It's been a huge pleasure. Hey, thanks so much for listening to how I built this lab. do follow us on your podcast app so you always have the latest episode downloaded. If you want to follow us on Twitter, our account is at how I built this and mine is at Guy Raz, and on Instagram, I'm at guy.raise. If you want to contact the team, our email address is H-I-B-T and ID.wondry.com. This episode was produced by Chris Messini with editing by John Isabella. Our audio engineer was Neil Rouch. Our music was composed by Rumptine Arableuie. Our production team at How I Built This includes Alex Chung, Carla Estevez, Casey Herman, J.C. Howard, Liz Metzger, Sam Paulson, Carrie Thompson, Catherine Seifer, Josh Lash, and Elaine Coates.

Neva Grant is our supervising editor. Beth Donovan is our executive producer. I'm Guy Raz, and you've been listening to How I Built This.