I recently went one on one Scott Sheridan, CEO of tastytrade.

Adam: Thanks again for taking the time to share your advice. First things first, though, I am sure readers would love to learn more about you. How did you get here? 

Scott: After I graduated college, I started a mail-order business with my mom and my aunt, selling sunglasses and CDs. I learned a lot while doing it, even though I didn’t make any money. 

I started getting interested in options trading - I was an economics and finance major in college, and I had learned about options from something like two pages in one of my textbooks. But my dad was friendly with two guys who had a firm trading at what’s now Cboe (formerly the Chicago Board Options Exchange). I started as a runner – back in the day of the trading pits, this was a junior position that ran orders down to the trading floor. I started actually trading options in 1986, to just after the market crash of 1987, when I moved to the OEX (the S&P 100 Index pit) which is where I met Tom Sosnoff, who has been my business partner for nearly 40 years now. We’ve built two online retail brokerages from the ground up and sold both, but I’m still involved in the business day-to-day. I still answer customer service calls because I’m passionate about giving our clients the best service. 

Adam: What experiences, failures, setbacks, or challenges have been most instrumental to your growth? 

Scott: I’m a firm believer that you learn way more from failures than you do from successes. Tom and I have had a few other businesses that didn’t do so well – we don’t talk about the gold mine in Mali! We had a money management business that didn’t grow like we thought it would, but we came up with thinkorswim as an offshoot from that, which we sold to TD Ameritrade. 

One of the scariest moments in my life was a mistake that one of our clearing firms made. One of our clearing firms had selected a price for closing that was totally out of the usual range, and we had a customer that held a huge long position that our clearing firm allowed to go through even though the position should have been worthless. It was the equivalent of something like $120 million in stock, and he had about $700,000 in his account. Unfortunately, our clearing firm didn’t pick up on the issue and allowed his trade to go through, and it could have put thinkorswim completely out of business. We had to scramble to adjust but we still lost a couple of million dollars on the trade. It was 5 or 6 “once-in-a-lifetime events” that all had to happen at the same time, and they did. I believe that luck factors out over time – so in general, I’d rather be good than lucky. We got lucky.

Adam: In your experience, what are the key steps to growing and scaling your business? 

Scott: Having a good idea is obviously the most critical, but being flexible is equally as important. Working really hard is important – everyone needs to work as hard as possible to build a business – but the flexibility part is where most people fail. People have a good idea, and they try to force it to work rather than letting the marketplace tell them how they need to adapt. If the marketplace isn’t buying into your idea, you need to modify. Most people get stuck and it becomes like one of those toy finger traps: the harder you pull, the tougher it gets. I think managers can make the same mistake, they might have the right people in the wrong roles and instead of listening to them, they try to force a square into a circle and that never works well. 

Adam: What do you believe are the defining qualities of an effective leader?

Scott: Leading by example. There’s a big difference between a leader and a manager. I think of myself as a leader – managers manage, but they don’t actually lead, they tell people what to do. I try to lead from the front and show people I’m willing to do what it takes and hope they come along for the ride. In my view, really good leaders find a way to appropriately challenge the team, and get people to produce in ways that they might not have thought they were capable of producing. I might ask you do something that you don’t think you’re capable of, but I see something in you that makes me think you can. I like to empower my people and one way to do that is by challenging them. 

Adam: How can leaders and aspiring leaders take their leadership skills to the next level? 

Scott: For everybody, success is defined differently – some people think it’s monetary, some people think otherwise. It depends on where the person is coming from – the way I manage is by challenging people and expecting them to get it done, not micromanaging. I think that’s how you get someone to the next level. I don’t want people to become complacent. I want our team to always be learning, be pushed, and be challenged. I believe you can’t rest on your success because someone’s always right behind you, ready to overtake you and it’s the same for leaders. You need to constantly grow, and challenge yourself and your team. 

Adam: What are your three best tips applicable to entrepreneurs, executives, and civic leaders? 

Scott: I like to say that the most important thing is to stay true to yourself and be genuine – it’s ok to think differently. People take too much outside input rather than trusting themselves. Tom, myself, and our team have been disruptors for 20+ years and I love that role, I love being an underdog. 

Second, as an entrepreneur or a leader you have to be willing to bust your ass all the time, to wear multiple hats, and to be prepared to take on multiple roles, especially when building a business.

Finally, be willing to listen and adopt, but don’t deviate from your values. If you’re approached by private equity or venture capital, it can be very flattering and it’s easy to fall in love with someone telling you how great your business is. The problem is when you lose directorial control. Make sure if you take money - whatever you want your business to look like after signing, make sure it’s all spelled out. Only take money if the terms are what you’re looking for. I prefer to take money when I don’t need it. 

Adam: What is your best advice on building, leading, and managing teams?

Scott: In terms of building teams, when hiring, we try to be very clear about what we’re hiring for – what kind of personality, what qualities and skills, what types of experience. We also work to draw that out in interviews by asking questions that will show us what type of person you are, whether you’ll be flexible to new opportunities within the company, what you’ve learned from your experiences. 

In terms of leading and managing, as I mentioned before, I like to give our people new challenges and watch them rise to the occasion. Let me give you an example – our Chief Compliance Officer for a new market we’ll be operating in, joined our company several years ago as a former yoga teacher with no options trading experience. Now she helps lead our Trade Desk for customer service and will be CCO in this new market, all because we saw potential within her. If I had just looked at her as a resume, we never would have found this incredible person, and this leader, for our business.

Adam: What are your best tips on the topics of sales, marketing, and branding?

Scott: My team and I have built two huge businesses in this space organically, and we’ve never really had a big marketing operation. We’ve just launched our first-ever major marketing campaign and ramped up in this area especially, so I’m learning a lot. I would say first, spend the time required to really understand the customer and how to best meet their needs. “Customer obsession” is a very real thing and you have to know your customer inside and out – where they come from, what motivates them, how to capture their attention, and what they want your product or company to do for them. 

Second, make sure you have a competitive point of difference. And finally, deliver above expectations. One of the ways we do this is through customer service. I personally still answer customer service calls because I really believe in what we’re trying to do as a company and I want our customers to walk away saying, “I can’t believe how helpful they were, they went above and beyond” every time they call. 

Adam: What is the single best piece of advice you have ever received? 

Scott: Be true to yourself. If you’re true and honest, it comes through, and it’s so easy for people to see. I give this advice to younger people: take a lot of risk – in a balanced “risk-reward” fashion. Don’t take reckless risk. Too many people are taught that risk is bad, they should just go to their job, do their 9-to-5 and keep their head down. Especially when you’re young, you have time to recover from taking risks. There’s too many people in this financial space that tell customers that they aren’t sophisticated enough to manage their money and they should let “the pros” do everything for them. However, there’s a lot of people that have an appetite for it and if you’re willing to take the time to learn, from a wealth of information out there, and take the time to control your financial future, you’re going to be a happier person in your life.


Adam Mendler is an entrepreneur, writer, speaker, educator, and nationally-recognized authority on leadership. Adam is the creator and host of the business and leadership podcast Thirty Minute Mentors, where he goes one on one with America's most successful people - Fortune 500 CEOs, founders of household name companies, Hall of Fame and Olympic gold medal-winning athletes, political and military leaders - for intimate half-hour conversations each week. A top leadership speaker, Adam draws upon his insights building and leading businesses and interviewing hundreds of America's top leaders as a top keynote speaker to businesses, universities, and non-profit organizations. Adam has written extensively on leadership and related topics, having authored over 70 articles published in major media outlets including Forbes, Inc. and HuffPost, and has conducted more than 500 one on one interviews with America’s top leaders through his collective media projects. Adam teaches graduate-level courses on leadership at UCLA and is an advisor to numerous companies and leaders. A Los Angeles native, Adam is a lifelong Angels fan and an avid backgammon player.

Follow Adam on Instagram and Twitter at @adammendler and on LinkedIn and listen and subscribe to Thirty Minute Mentors on your favorite podcasting app.