Brendan Wood
Appearances
Code Story
S10 E4: Brendan Wood, SnapTrade
Both sides are moderately well satisfied in that sense. It's up really well for growth.
Code Story
S10 E4: Brendan Wood, SnapTrade
This probably goes back to the hiring. So we used to hire based on code tests. They weren't like the pithy, not like Google style CS problems or anything. We're going to throw something out of left field at you and just see how you figure it out. So that was the only way that we filtered previously. And we didn't have a strong filter for culture.
Code Story
S10 E4: Brendan Wood, SnapTrade
And we ended up making a few terrible hires and then having to deal with the fallout from that. That was a huge learning moment for me. Effectively, the way that we do things now is we don't give people coding tests. Essentially, what we do is we'll meet somebody, interview them, ask them questions, get to know them a bit.
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S10 E4: Brendan Wood, SnapTrade
And if it sounds like they're competent at whatever the role is that we want them to do, we hire them on contract.
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S10 E4: Brendan Wood, SnapTrade
that doesn't work for everybody and it's a huge ask for a perspective employee go take a week off with your other job and work for us in the meantime but we pay people quite well for doing those one week trials with us and we've actually found that most people are like excited about the idea you're pitching somebody on quit your job and join us
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S10 E4: Brendan Wood, SnapTrade
that's a big unknown they don't really know us so we give them the opportunity come work with us for a week you can work on practical problems you'll have a dedicated person on our team who's going to be your handler while you're here and helping you get on board and so on and you can see if you like it and we can see if we like you
Code Story
S10 E4: Brendan Wood, SnapTrade
going to keep doing the same thing like we have to keep doing what we're doing we're not planning on adding vastly new features it's really more about adding more integrations as we go improving the integrations we have legitimizing a lot of the integrations with official partnerships with financial institutions that kind of stuff the future is exciting so we have really strong traction on both sides of the market both on the financial institution side and on the demand side with with applications we're approaching a tipping point in the market where
Code Story
S10 E4: Brendan Wood, SnapTrade
Brokers are actually coming to us and we have large potential customers coming to us and saying, hey, we've heard about you guys and we have an idea for how an integration or how we might be able to use your functionality. And so it feels like the boulder is just tipping over the top of the hill and it's starting to pick up steam on its own. And it's really an amazing feeling.
Code Story
S10 E4: Brendan Wood, SnapTrade
really look up to people who have a vision and who have grit like those are the things that i admire the most people who strongly believe something should exist and they're just going to go make that happen regardless of what the naysayers say and there are a lot of naysayers when you try to do something new especially when you ask people for their support and one of the metrics that i've come across to help identify something truly new is if you pitch something and the answer you get is oh yeah i understand what you're doing but it doesn't look like a market exists for that
Code Story
S10 E4: Brendan Wood, SnapTrade
If I get that answer, I'm like, that's because it's probably generally new. It may be that it doesn't exist for a reason because it's a terrible idea. But if the market doesn't exist and nobody really understands what the application is, but the person has a bit of vision and they think there's something there and they're going to go explore that, that is the epitome of entrepreneurship.
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S10 E4: Brendan Wood, SnapTrade
And I just love it. I can admire and respect some aspects of people's personality while not appreciating others. Steve Jobs is a great example of that.
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S10 E4: Brendan Wood, SnapTrade
his initial vision along with was of creating graphical user interfaces and computers and defining that entire market and then the eventual comeback with the reinvention of apple and the creation of the ipod like just incredible just creating things left and right that nobody thought were doable
Code Story
S10 E4: Brendan Wood, SnapTrade
One of the things I like about that was like the story of the iPod and how it was created and how Apple knew exactly what was needed to make a successful product with the iPod before the technology was even there. Like they knew the core problem was storage density at a reasonable price. And as soon as they found that, it was like, it's go time.
Code Story
S10 E4: Brendan Wood, SnapTrade
They bought the entire world supply of mini hard drives because they knew exactly what to do with it. Another example would be Tolkien. I only found this out recently, but he worked on Lord of the Rings for 14 years. before he finished it. And he did like a whole three books in one go. It was intended to be one large volume. Even after he got that done, his publisher wouldn't publish it.
Code Story
S10 E4: Brendan Wood, SnapTrade
He spent years trying to get this thing published. And I guess fantasy genre didn't really exist, but the publisher didn't think it would sell. And as evidence of this, like the reason why there's three books for it was like risk mitigation on part of the publishers. They were like, we're not sure we can sell 2000 pages of this. We're going to sell a third of that
Code Story
S10 E4: Brendan Wood, SnapTrade
14 years of work only to have people tell you that, what, probably there's no market for this, no one's going to buy it. But then powering through it anyway, like, ton of respect for that. I mean, I mentioned Plaid earlier. I have a ton of respect for the founders of Plaid, Zach Paré, Will Hockey. I actually had lunch with Will back in 2013, shortly after they raised their round.
Code Story
S10 E4: Brendan Wood, SnapTrade
Will was telling me what they're doing, and I'm like, I don't get it. He even suggested that I join the team at one point because I was involved in, like, web scraping and a bunch of stuff that would have been relevant for them. And I was like, nah, I don't really understand who could possibly have use for a bank account integration.
Code Story
S10 E4: Brendan Wood, SnapTrade
And there's interviews with Zach out there, same sort of thing, where that was one of the big early problems they had was how do you convince people to fund something where the market doesn't exist? They laugh. I'm like, oh, I really understand what they saw now.
Code Story
S10 E4: Brendan Wood, SnapTrade
Overall, I'd encourage them to have confidence in their vision and lean into it. If the entrepreneur is not confident, they say, I'm having a hard time really like buying in and jumping in. Okay. Probably have questions. You probably have some concerns and you should answer those concerns first and foremost.
Code Story
S10 E4: Brendan Wood, SnapTrade
And I think that's hard for a lot of new entrepreneurs because there's a strong risk of you go to measure this thing and you realize the answer is not what you hoped. It's getting punched in the mouth repeatedly, right? Like it's hard to say, yeah, I'm going to go take another one of those.
Code Story
S10 E4: Brendan Wood, SnapTrade
If the answer you find is based in reality, then it's better to find that sooner rather than later in almost every case. One of our closely held beliefs at SnapTrade is that our product is this unified trading API. It won't work without the support of stockbrokers in the long run. Right. Like we're not a broker dealer ourselves. We had no plans on being one.
Code Story
S10 E4: Brendan Wood, SnapTrade
We essentially partner with stockbrokers around the world and we see them as like hardware that we're running on. Right. Like they provide custody, compliance and execution. And we're never going to do that because that's just not our jam. So they are the regulated bag holders for all of this stuff.
Code Story
S10 E4: Brendan Wood, SnapTrade
And so if they're not on side with what we're doing, eventually the shoe is going to drop and it's going to be a problem. As a result of that, we make a point of talking to these brokers as soon as it makes sense to have a conversation and we have something we can share with them. We go and do it. And that's super risky.
Code Story
S10 E4: Brendan Wood, SnapTrade
You go to a billion dollar company and say, listen, we're scraping your API and pushing trades through your API, through these other applications. What do you think of that? And a lot of the time the reaction is just like shock and horror, right? You're doing what? We're radically candid with financial institutions about what we do.
Code Story
S10 E4: Brendan Wood, SnapTrade
And yeah, we can fly under the radar for now, but like in the long run, we need them to be on side. And so we make a point of telling them what we're doing. And so sometimes that sucks. Sometimes you do get punched in the mouth and they say, shut down your integrations or they'll threaten you. But we actually find that the overwhelming majority are very supportive of what we're doing.
Code Story
S10 E4: Brendan Wood, SnapTrade
Even if they have some concerns about it, they'll say, that's interesting. Let's tell you what, we're not going to tell you to shut it down right away. Let's explore this a little bit. And even if they choose not to go with it in that conversation, we're building trust with them. And that's the single most important thing in this industry is trust. It's financial services.
Code Story
S10 E4: Brendan Wood, SnapTrade
We're constantly doing the same thing of challenging our assumptions, trying to answer the hairiest questions around, is this going to work? Is this broker going to be supportive? Even if they're not, and the answer sucks, it's better to find that out now instead of two years from now when we have customers depending on this and it becomes a much bigger problem.
Code Story
S10 E4: Brendan Wood, SnapTrade
SnapTrade is a unified trading API. If you're familiar with a service like Plaid, we think of ourselves like Plaid, but for trading specifically. So from like a user's perspective, you might not even be aware you're using SnapTrade for the most part. It's not like a direct consumer facing brand.
Code Story
S10 E4: Brendan Wood, SnapTrade
But essentially what we do is we make it easy for you to connect your stock trading account into third party applications that you use to help you make decisions about the market or analyze your portfolio or do tax planning or whatever it is you need to do. Investors are relying more and more on third-party tools. They're not necessarily making all of their trading decisions at their stockbroker.
Code Story
S10 E4: Brendan Wood, SnapTrade
And there's usually a bunch of additional tooling that's helpful for them to manage their accounts outside. So the lack of integration has been a problem that we've seen in the market for a long time. It's something that I faced personally at Passive, which was the previous iteration of this business.
Code Story
S10 E4: Brendan Wood, SnapTrade
The integrations were the biggest problem to our growth at Passive because nobody offered off-the-shelf solutions. And so essentially we're trying to tackle that. It's a larger problem. And we think if we do a really good job at it, it's going to fundamentally change the industry.
Code Story
S10 E4: Brendan Wood, SnapTrade
We went into it thinking, oh my goodness, this is gonna be a huge lift for us. We're gonna have to build 100 integrations very quickly. But talking to customers, we realized, oh, it turns out that coverage isn't the single most important thing. It's more important to have reliability and feature depth first.
Code Story
S10 E4: Brendan Wood, SnapTrade
The longest part of bringing SnapTrade to life was deciding we were going to do it. We were building the passive app before that, sort of like a build-your-own-robo-advisor tool, run it in your own brokerage account, that sort of thing. And that depended on high-quality trading integrations to a brokerage account. In order to be able to place trades through a third-party app, you need an API.
Code Story
S10 E4: Brendan Wood, SnapTrade
Like I said, we were running into these integrations problems. We were spending probably 80% of our engineering budget on integrations. It was hard to even focus on our own product quality at that point. In the summer of 2021, we were kicking around the idea of maybe we should consider selling our integrations.
Code Story
S10 E4: Brendan Wood, SnapTrade
Wouldn't it be easier for us to justify the engineering effort on integrations if we could make money off them in some other way? So we had some friends who were running other B2C fintech applications. And occasionally these people would reach out and say, listen, you guys got these integrations to a few brokers that we like. Can we use that?
Code Story
S10 E4: Brendan Wood, SnapTrade
And our answer was always, no, that's like our proprietary technology. That's our competitive advantage. We're not just going to license that to anybody else. But it started happening more and more frequently in 2021. And we started really thinking about it.
Code Story
S10 E4: Brendan Wood, SnapTrade
If the integrations are our biggest problem, wouldn't this be so much better if we had 100 applications that we could power with these integrations or 1,000 applications? It snowballed from there. We said, let's have a few conversations with people. And we, in, let me see, early fall 2021, we started like cold calling a few other companies just to test the water.
Code Story
S10 E4: Brendan Wood, SnapTrade
And I remember the first call that we cold called, it was on a whim. We'd never spoken to this guy before. We found his phone number randomly. He was running essentially a third-party tool for self-directed traders. We called the guy up and said, here's what we're thinking about doing. We see you guys have built one of your own integrations to this stock broker. How would you like to have more?
Code Story
S10 E4: Brendan Wood, SnapTrade
We have eight of those that are currently functioning in our own product. We're thinking about commercializing this. Does that sound interesting? And his quote was, shut up and take my money. Sounds like this could be useful. So we looked into it a bit more. We kept having responses like that of people saying, this is a huge need. If you build this, I will buy it.
Code Story
S10 E4: Brendan Wood, SnapTrade
That's when we realized, okay, we really need to take this seriously. So we actually decided to pivot the focus of the company in November, 2021 or October, 2021, one or the other. And it wasn't a hard pivot. Not like we're shutting down the passive app, but let's just not put a ton of effort into this app at the moment.
Code Story
S10 E4: Brendan Wood, SnapTrade
And let's instead focus on the integrations and see if we can get a few other applications on there. But in order for that to work, you need an MVP. That's where we said, all right, what's the quickest way we can smoke test this? Yeah, we're talking to people. We're cold calling them. We're cold emailing them. We're getting a really strong signal.
Code Story
S10 E4: Brendan Wood, SnapTrade
If you don't have the ability to do an on-demand account sync, that's not very useful for most of the applications who are interested in our API. If you don't have the ability to place orders, that's another thing that's a deal breaker. It's like, why would you even integrate with a trading API if it doesn't trade, right?
Code Story
S10 E4: Brendan Wood, SnapTrade
If we build an API, build an MVP, will people actually launch with it and use it? So one of the things that we had in our favor was that we already had a lot of the integrations in-house for the path of that. It was roughly three to four months between that initial focus period and when we actually launched the MVP.
Code Story
S10 E4: Brendan Wood, SnapTrade
And we were able to do it quickly because essentially what we were doing is using our existing API and adding a new authentication front end to it to allow other applications to use our same backend. So it wasn't like a fundamental technology change for us. And so that's what we did.
Code Story
S10 E4: Brendan Wood, SnapTrade
We realized pretty quickly that we don't need to support every broker in the world. We can pick a few of the big ones in the US market and a few other markets that are important to us and just do a really good job at those. My name is Brendan Wood, and I'm the co-founder and CEO at SnapTrade.
Code Story
S10 E4: Brendan Wood, SnapTrade
So we got a few early customers on there. And one of the things we quickly realized is that coverage is not the most important thing. We went into it thinking, oh, my goodness, this is going to be a huge lift for us. We're going to have to build 100 integrations very quickly. But talking to customers, we realized, oh, it turns out that coverage isn't the single most important thing.
Code Story
S10 E4: Brendan Wood, SnapTrade
Obviously, it's important to have coverage because that's like kind of your serviceable market, right? It's more important to have reliability and feature depth first. If you don't have the ability to do an on-demand account sync, that's not very useful for most of the applications who are registered in our API.
Code Story
S10 E4: Brendan Wood, SnapTrade
If you don't have the ability to place orders, that's another thing that's a deal breaker. It's like, why would you even integrate with a trading API if it doesn't trade, right? We realized pretty quickly that we don't need to support every broker in the world.
Code Story
S10 E4: Brendan Wood, SnapTrade
We can pick a few of the big ones in the US market and a few other markets that are important to us and just do a really good job at those. Just build a reliable product that has the features that our customers need and we can get to the rest of the market eventually.
Code Story
S10 E4: Brendan Wood, SnapTrade
But we can only do that if we do a good job at keeping the scope minimal and having a high quality product, even though it's limited in terms of coverage. And that really has been the focus for a long time because of the way that we built the MVP.
Code Story
S10 E4: Brendan Wood, SnapTrade
From a pure engineering perspective, it may have been better to go back and redesign the API from the ground up and rebuild the back end from the ground up with some of the assumptions that we're changing now that we're allowing third parties to access the API. Would have reduced the technical debt that we're still dealing with today.
Code Story
S10 E4: Brendan Wood, SnapTrade
But we wouldn't have been able to validate demand quickly enough. Probably wouldn't have taken us a better part of a year to actually go launch something like that. And we were able to do it in a couple months and launch with our first few customers. Yeah, in terms of like how we look at the roadmap going forward, it's driven by customer feedback.
Code Story
S10 E4: Brendan Wood, SnapTrade
Usually customers will tell us if there's a broker that's very important to them, or if they'll say, you have trading at these institutions, but you don't have it on this one yet. What do we do to get that? So then we can focus on those things. But it's largely a question of which effort we put in is going to drive the needle the most for our customers.
Code Story
S10 E4: Brendan Wood, SnapTrade
A lot of the core people are the same. We've expanded the team. We've doubled in size. Some people have left. Some people have joined. In terms of what we look for, we essentially have a positive filter on intelligence and grit. That's what we really look for, first of all. Like, how quickly can you solve novel problems that you face with you've never come across before?
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S10 E4: Brendan Wood, SnapTrade
And really, that's about having people who have the capability to be generalists on the team. It's nice to have a few really sharp employees who have specialties, but early stage startup, you really need people that can wear a lot of different hats and be able to pivot quickly into something a little bit different from what they were doing.
Code Story
S10 E4: Brendan Wood, SnapTrade
Most of the problems that we encounter are fairly hairy and you can't give up at the first sign of trouble. You have to really just find a way to grind through it and bust through the wall. So those are like the two things we look for in terms of a positive filter. And then we have a negative filter on attitude. Excuse my language, but it's no assholes rule, right? It's a culture fit thing.
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S10 E4: Brendan Wood, SnapTrade
And we want to make sure that everybody's working together constructively and collaboratively. We've come across like absolutely brilliant potential employees who could potentially be game changers for the company. But we found maybe there's a little bit of arrogance or maybe they're a little bristly to work with. And that's enough for us to say that. No, sorry.
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S10 E4: Brendan Wood, SnapTrade
Like the team has to jive if this is going to work in the long run.
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S10 E4: Brendan Wood, SnapTrade
It's hard to know where the scaling problems are going to be until you run headfirst into them. So really what we did is like on day one, we built it to work. Like it's just going to work and we'll address the scaling problems as they come up. We even moved cloud providers in the last couple of years because like the cloud provider we were with, it just wasn't scaling to meet our needs.
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S10 E4: Brendan Wood, SnapTrade
So we had to migrate. That's not something I think we would have easily foreseen. And so it's probably good that we didn't do it in advance and we did it when it was important to do it. And that way we can use our resources most effectively as we need them.
Code Story
S10 E4: Brendan Wood, SnapTrade
I think it's that we're building something that's really hard. It's a two-sided market. You've got, well, it's even more than that. Like you've got stockbrokers or huge billion-dollar financial institutions on one side, and you've got scrappy startup apps and founders and entrepreneurs on the other side.
Code Story
S10 E4: Brendan Wood, SnapTrade
And then you've got users who are customers of both the app and the broker, and then we have to facilitate the data access. There's a lot of moving pieces. Starting from like ground zero, like how do you even get started? It's a network effect driven thing where on day one, say we were pitching this API to apps and we had nothing built already. And we said, yeah, unified broker API.
Code Story
S10 E4: Brendan Wood, SnapTrade
And they'd say, what brokers do you support? And we say, none. It's not very useful, right? And it works the other way around as well. You go to a billion dollar financial institution. Listen, we're building a unified API to have an ecosystem of apps. And they say, what apps do you have? It's a chicken and egg problem. So getting over that is very difficult.
Code Story
S10 E4: Brendan Wood, SnapTrade
And we were able to do it because we had the passive app. So we effectively built customer number one and used that to justify the early integrations with a lot of these brokers and build relationships with them over a few years. And then once we had that, we went and just opened it up to a bunch of apps.
Code Story
S10 E4: Brendan Wood, SnapTrade
And once we started getting some big logos on the platform, then we go back to the brokers and we get even bigger names and so on, right? So laddering out of that bootstrapping problem is probably the hardest thing that we've done. And I'm super proud that we've been able to make it this far. I It feels like we're at a point where the network is fairly stable.