In 1987, James Altucher '89 -- today a successful entrepreneur, columnist and author -- started his first business, CollegeCard, with two other Cornell students. Back then, debit cards were nonexistent, and it would be nearly unthinkable for a student to have a credit card, he said. So, Altucher and his partners installed point-of-sale machines "into every restaurant in town."
Parents could send money to a local bank account, and for $21 per semester, students could use this early debit card and receive a discount at participating restaurants. About 700 students signed up, but once his partners left, Altucher went out of business. The experience, he said, was "really an abysmal failure."
Altucher, who majored in computer science at Cornell, presented "How to Make a Trillion Dollars" Nov. 4 in Sage Hall. He is managing director of Formula Capital, an alternative asset management firm, and author of four books on investing. Altucher also writes for The Wall Street Journal and AOL Finance, has founded numerous Web firms and regularly appears on CNBC, Fox News, Fox Business and CNN Radio.
After leaving his first job as a junior programmer at HBO, Altucher said he started a business called Reset that designed websites for companies from American Express to gangsta rap music labels. He sold Reset in 1999 for a profit, and raised $30 million to start a wireless Internet company.
When the company started to bust in 2000, Altucher said that the board of directors "brutally kicked me out." He described the lesson learned: Businesses that are "profitable from day one, those work. If you have to raise $30 million, there's a good chance it's not going to work." In all his experiences, Altucher noted that although "sometimes it's important to be persistent in the face of failure," one needs to give up unsuccessful or unrealistic projects.
Not only had Altucher been kicked out of his company, but he also lost money in the stock market. During the Internet bubble, he said he had been living "like a drunken rock star, it was insane." To support his lifestyle and pay the rent for his 5,000-square-foot penthouse in Tribeca, he wrote a program to model the stock market and began day trading successfully.
"Every day I would take a notebook," Altucher said, and "write down ideas for new businesses." He sent these ideas free to hedge funds and big financial companies in the hope of getting involved in the stock market. No one bit, but Altucher "built up a small business trading for hedge fund managers."
Altucher eventually created Stockpickr.com, a social networking financial website. He called the site "basically like MySpace meets finance," where users could upload portfolios and interact in an online community. In 2007, he gave 50 percent of the company to the financial news and services website TheStreet.com, and in return TheStreet would fill ad space on the site.
Stockpickr.com soon had 1 million unique users a month. Altucher said, "The big lesson I learned form Stockpickr was: Don't be a pig." Other entrepreneurs couldn't believe he gave 50 percent of his company to TheStreet, and one of his employees even quit. But, Altucher said, "if I only gave TheStreet.com 2 percent of the company, they wouldn't care at all." He added that "if you want people to do something for you, you have to do something for them."
The talk was organized by the Entrepreneurship@Cornell program.
Joseph Mansky '12 is a writer intern for the Cornell Chronicle.