How Amanda Steinberg Turned Her Idea for DailyWorth Into a Successful Business
BY David Ronick
David Ronick started coaching Amanda Steinberg three years ago. Earlier this year she raised $850,000 from a group including Google executive chairman Eric Schmidt's TomorrowVentures.
Amanda Steinberg is the Founder & CEO of DailyWorth
When I met Amanda Steinberg through a mutual friend in July of 2008, DailyWorth was just an idea: A daily e-mail newsletter with advice on personal finance for women. I began coaching Amanda shortly after that, and in January of 2009, she launched DailyWorth. Today, her e-mail newsletter has more than 100,000 subscriptions—and is growing 10 percent each month. And since she started, Amanda has raised nearly $1 million, from savvy investors like Google executive chairman Eric Schmidt's TomorrowVentures and Dave McClure's 500 Startups.
These days Amanda speaks frequently to large audiences about women and personal finance—as well as how to launch and build a successful business. Afterwards, women often rush to the podium, seeking inspiration and advice. I recently caught up with Amanda, to identify the most important lessons she has learned along the way (and usually shares with curious entrepreneurs-to-be). Here’s a quick list.
1. Start with an authentic idea. As a mother of two and de-facto CFO of her family, Amanda had wrestled with budgeting, saving, and investment challenges. She knew from her own experience that there wasn’t already a publication that "spoke" directly to women about finance. That insider’s perspective also helped her win over readers, advertisers, and investors.
2. Follow a proven model. When I started working with Amanda, we matched her idea to the daily email newsletter model—including formats, frequency, unit economics, and critical mass—that had already been proven by DailyCandy and others. That gave Amanda a strategic roadmap, the confidence that it could be done, and insights into the secrets to pulling it off—like making sure she could attract readers for just a few dollars, and sell advertisers access to them for several times more over the lifetime of a subscription. "The first time we spoke, the email newsletter 'business model' was totally new to me," says Amanda. "Now I explain it to other newsletter founders and watch them have 'aha' moments."
3. Find advisers and employees who have done it before. Since a few email newsletter businesses had already been built and sold before DailyWorth got started, it was possible to track down people who knew the email newsletter model inside and out. We found that these people were very open to taking meetings and calls because they wanted to share and capitalize on their expertise. Amanda brought several of these experts on board as advisors, consultants, and employees. For instance, Jen Boulden, who is now a DailyWorth director, co-founded Ideal Bite, an email newsletter for eco-friendly consumers that the Walt Disney Company bought in 2008 for a reported $20 million.
4. Get results, then raise outside money. To make the capital-raising process more efficient, Amanda got results before seeking capital from big name investors. She bootstrapped until she had a few thousand subscribers and felt comfortable that she was on the right track. Armed with that early progress, she raised a round of financing from "friends and family" and used it until she had a solid base of advertisers and a formula for acquiring customers. At that point, DailyWorth had a winning business plan, and Amanda was able to raise even more money in a series A round than she had targeted.
5. Don’t be fooled into thinking it’s easy. Along the way, Amanda landed a term sheet from an investor for several hundred thousand dollars, and pushed to have the check written right away. The investor backed out. "I cried like a baby that night," Amanda admits. "But by the morning, I was right back at it, chasing down more investors."
David Ronick and Jenn Houser are serial entrepreneurs and start-up advisers. They partnered with Inc. to create Upstart Bootcamp@Inc., a program that guides entrepreneurs to start up smarter. To learn more about business planning, take UpStart's on-demand course. Or get a free reality check to find out if your plan is ready for action.