Howard Lindzon
Co-founder of StockTwits and managing partner of Social Leverage
Built an open platform for market conversation and introduced the cashtag, the dollar-sign ticker convention now used across social networks.
Biography
Howard Lindzon is a Canadian-born investor and entrepreneur who built the infrastructure a great deal of online market conversation now runs on. He took a commerce degree at the University of Western Ontario and later studied at Arizona State University and the Thunderbird School of Global Management, and began managing a small hedge fund in 1998.
In 2006 he started Wallstrip, a short daily video show about a stock that had reached a new high, made in a register closer to comedy than to financial television. It ran for two years and was acquired by CBS in 2007. The show mattered less for what it covered than for demonstrating that market commentary could be made cheaply, published directly, and still find an audience, which was not obvious at the time.
StockTwits followed in 2009, co-founded with Soren Macbeth. Its central design decision was the cashtag: prefixing a ticker with a dollar sign so that every mention of a company becomes machine-readable and every stream of conversation becomes filterable by the thing it is about. Twitter adopted the same convention in 2012, which spread it well beyond the platform that invented it and turned a formatting choice into a piece of market plumbing.
He also runs Social Leverage, an early-stage venture firm investing in software and financial technology, and has written for many years about what he sees happening in markets. He wrote The Wallstrip Edge in 2009 and co-wrote The StockTwits Edge in 2011.
Career timeline
- 1991Completes a master's degree at the Thunderbird School of Global Management.
- 1998Begins managing a small hedge fund.
- 2006Launches Wallstrip, a short daily video show about stocks hitting new highs.
- 2007Wallstrip is acquired by CBS.
- 2009Co-founds StockTwits with Soren Macbeth and introduces the cashtag.
- 2009Publishes The Wallstrip Edge.
- 2011Co-writes The StockTwits Edge with Philip Pearlman and Ivaylo Ivanhoff.
- 2012Twitter adopts the cashtag convention, spreading it beyond StockTwits.
How he approaches markets
He treats what people are saying about a market as information in its own right rather than as noise surrounding the real data. Prices tell you what was agreed; conversation tells you what is being argued about, and who is early, and where attention is moving. Structuring that conversation so it can be filtered and measured is the practical form of that belief, and it is essentially what the cashtag does.
His investing leans toward strength rather than cheapness. Wallstrip covered companies making new highs, on the reasoning that a share reaching territory it has never seen is telling you something, and that the instinct to avoid it because it has already risen is usually the wrong one. That puts him closer to trend-following than to any valuation discipline, and he is direct about the trade-off involved.
The third strand is that being early matters more than being certain. His venture work backs small companies long before the case is provable, and his market writing is about noticing a shift while it is still contested rather than waiting for it to be established. The corresponding discipline is accepting that most early positions are wrong, and sizing them so that being wrong repeatedly is survivable.
Key ideas
Tap any idea to expand a plain-English explanation, why it matters, and where to learn more.
The cashtag
Prefixing a ticker symbol with a dollar sign so that a mention of a company becomes structured, searchable data rather than plain text.
It turns an unfiltered stream of posts into something that can be filtered by subject, which is what makes market conversation usable at all.
A single convention lets every mention of a company across a whole network be collected into one view without anyone tagging it deliberately.
Conversation as market data
The idea that what people are discussing, and how the discussion is shifting, carries information that prices alone do not.
A price records a conclusion. The argument that produced it, and the argument now forming, are earlier signals about where attention is going.
A sharp change in how much a company is being discussed often precedes the move that makes everyone notice it.
New highs are information
The trend-following view that a share reaching territory it has never traded in before is telling you something rather than warning you off.
The instinct to avoid something because it has already gone up treats the past price as a fair value, which it usually is not.
An investor waiting for a pullback that never comes can miss the whole of a move while holding out for a better entry.
Being early costs money until it does not
The venture approach of taking small positions in unproven things long before the case can be demonstrated.
By the time an idea is provable it is priced, so the only way to be early is to accept being wrong most of the time.
A portfolio of small early positions can work even when the majority fail, provided no single one is large enough to matter on its own.
Publish directly and cheaply
The practice of building an audience by publishing straight to it rather than going through an established financial media outlet.
It removes the gatekeeper from between a view and its readers, which changes both who can be heard and how quickly.
A short daily video made for very little money reached an audience that a television slot would have cost a great deal to buy.
Major contributions
- Co-founded StockTwits, one of the first platforms built specifically for real-time conversation about individual securities.
- Introduced the cashtag, a formatting convention that became standard across social networks after Twitter adopted it in 2012.
- Demonstrated with Wallstrip that market commentary could be produced cheaply and published directly to an audience.
- Built an early-stage venture firm focused on software and financial technology, backing companies in the retail investing space.
- Made the case, well before it was obvious, that structured conversation about markets is a dataset rather than background chatter.
Major successes
- Launched Wallstrip in 2006 and sold it to CBS the following year, an unusually quick outcome for an independent video project.
- Co-founded StockTwits in 2009, which became a widely used venue for real-time discussion of individual companies.
- Created the cashtag convention, which Twitter adopted in 2012 and which is now used across multiple platforms.
- Founded and runs Social Leverage, an early-stage venture firm investing in software and financial technology.
- Wrote The Wallstrip Edge in 2009 and co-wrote The StockTwits Edge in 2011.
Important books
- The Wallstrip Edge2009
On finding companies in long uptrends and on building an audience by publishing directly. As much about the media experiment as about the method.
- The StockTwits Edge2011
Co-written with Philip Pearlman and Ivaylo Ivanhoff. A collection of trade setups contributed by users of the platform, with the reasoning behind each.
Influence on investors
The cashtag is his most durable contribution and the one fewest people can name. Every filtered feed of company mentions, every sentiment dataset built from social posts, and every retail platform that shows a discussion stream next to a chart depends on there being an agreed way to say which company is being talked about. That convention came from StockTwits.
He was also early to the argument that retail investors would organise themselves online rather than through brokers and financial media, which looked eccentric in 2009 and looks obvious now. Much of the infrastructure of retail investing conversation was built by people who used his platforms first.
Criticisms and debates
A balanced view includes the main criticisms and open debates, presented neutrally.
- A real-time stream of opinion about individual companies is an environment where confident strangers are rewarded with attention, and the format does very little to separate a well-reasoned view from a loud one.
- Structuring conversation makes it easier to measure and also easier to manipulate, since coordinated promotion of a small company works better on a platform where every mention is collected in one place.
- Sentiment drawn from social posts has a poor record as a predictor. It reflects who is posting rather than who is trading, and the two populations are not the same.
- The trend-following instinct behind his market writing is the one most likely to hurt an inexperienced investor, because it reads as permission to buy whatever has already risen the most.
- His public track record is a stream of commentary rather than an audited return series, which makes it easy to remember the calls that worked and hard to weigh them against the ones that did not.
Lessons for investors
Plain-English takeaways. Context for learning, not advice to buy or sell anything.
- 1A price records a conclusion, while the argument forming around it is the earlier and messier signal.
- 2Avoiding something because it has already risen treats an old price as though it were a fair value.
- 3An audience can now be reached directly, which changes who gets heard but not who is worth listening to.
- 4If you intend to be early you will be wrong often, so no single early position can be big enough to matter alone.
Frequently asked questions
Who is Howard Lindzon?
Howard Lindzon is a Canadian-born investor and entrepreneur. He founded the video show Wallstrip, co-founded StockTwits in 2009, created the cashtag convention, and runs the early-stage venture firm Social Leverage.
What is a cashtag?
It is a ticker symbol prefixed with a dollar sign, so that a mention of a company in a post becomes structured data. It lets every reference to a company be collected and filtered, and Twitter adopted the convention in 2012.
What is StockTwits?
A platform built for short, real-time posts about individual securities, co-founded in 2009. Its design assumption is that conversation about a market is worth structuring rather than leaving as unfiltered text.
What was Wallstrip?
A short daily video show launched in 2006 covering a stock that had reached a new high, made in a comic register rather than a financial-news one. CBS acquired it in 2007 and it ran until the end of 2008.
Is social media sentiment useful for investing?
Its record as a predictor is poor. It measures who is posting rather than who is trading, it is straightforward to manipulate on a small company, and the loudest view in a stream is not usually the best reasoned one.
Why does he pay attention to shares at new highs?
Because a share in territory it has never traded in is not being held back by anyone waiting to break even, and the instinct to avoid something for having already risen treats an old price as if it were a fair value.
What does Social Leverage do?
It is his early-stage venture firm, investing small amounts in software and financial technology companies well before their prospects can be demonstrated, on the basis that anything provable is already priced.
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