Builders & Buyers: Hooman Radfar of Collective on Leadership, Legacy, and Lifelong Learning

Builders & Buyers is dedicated to showcasing leading figures in the fintech industry and their contributions. Through candid and in-depth conversations, Stifel Bank’s Managing Directors, Josh Dorsey and Jake Moseley, aim to connect audiences with the thought leaders driving the future of finance. The series will explore personal journeys, company building, investing strategies, and topical macroeconomic conditions.

Notes from Josh Dorsey, conversation moderator:
Hey, everyone. Thrilled to share this next installment of Builders & Buyers, where I had the chance to chat with Hooman Radfar, founder and CEO of Collective. Hooman is an incredibly deep thinker, rooted in principles and mental models, and extremely authentic. As we chatted, I found myself constantly grinning while he responded to questions. What stood out to me about Hooman is the genuine passion he has for empowering solopreneurs to thrive – he’s on a mission to help freelancers and small business owners reclaim time and energy for what matters most. You’ll notice his perspective is shaped by both personal experiences and a big-picture vision for the future of work.

Hooman’s journey is packed with depth and refreshingly candid insights. He keeps it real about the struggles, the resilience, and even the “tolerable trauma” many entrepreneurs carry. His appreciation for culture-building and people-first leadership shows in how he runs Collective, and I think it’ll resonate with anyone who’s ever built a team or faced the highs and lows of entrepreneurship.

I left this conversation with a whole new perspective on what it means to lead, learn, and, most importantly, lift others up along the way. I hope you get as much out of it as I did!

Josh: Let’s start with an easy one. What’s something you do outside of work that helps you unwind?

Hooman: I actually have two main things. The first might be a little surprising, but I’m more introverted than people expect. My job requires constant interaction, and while I enjoy it, I realized during the COVID years that when I’m away from people, my energy goes up – it was a big wake-up call. So, on weekends, I go for long runs, usually a 10K every Saturday. It’s just me, running, with music.

The other thing is playing guitar. I’ve been playing since I was 16, and if I can, I’ll play for two to three hours. I don’t practice as often as I’d like, but it always leaves me feeling great.

Love that! Now, let’s talk about your roots. You grew up in London and later moved to the U.S. How did those experiences shape your views and entrepreneurial spirit?

First and foremost, being an immigrant, you don’t have a sense of automatic belonging in a community. My family and I moved away from London to Pittsburgh, which I love, but at that time, there weren’t many Iranians there. My parents spoke with thick accents, we ate different foods, and I didn’t always feel like I fit in. And then, after my parents divorced, that feeling of isolation deepened. I think all of this gave me a bit of a chip on my shoulder, and it drove me to create a life and environment I could control – one where I belonged. I have this theory that many entrepreneurs have some form of “tolerable trauma” that fuels their drive. Think about it: Larry Ellison was adopted, Steve Jobs was adopted, Elon Musk is an immigrant. Even Bill Gates – he was isolated because of his interests, so he spent time with Paul Allen in a computer lab. And it led to a great outcome. So, I think that laid the groundwork for me.

When it comes to role models, I didn’t fully appreciate it until I started, but my parents were both physicians and entrepreneurs. They ran their own practices after the divorce, and seeing them be independent and their own bosses was second nature to me. It showed me that being in control was possible. I think that foundation drove me toward entrepreneurship.

Now, shifting to your entrepreneurial journey – your first venture was a significant step. Could you tell me what that was and some key lessons you took from the experience?

What got me into business specifically was when I went to a talk by Josh Kopelman from First Round Capital and Andy Rachleff, who funded eBay at Benchmark. They got up on stage, and I saw these young guys talking about building technology companies. That was it – I got hooked. I loved engineering but wanted to deliver impact through it. That talk was a catalytic event for me.

My first venture was actually a non-venture. I wanted to start a video-on-demand company in undergrad. This was around 2001. I hated Blockbuster with a passion because of the late fees, and I thought, “One day, this is all going to be online.” I then found a research paper about video delivery over DSL. I started researching more, and an advisor encouraged me. But then the dot-com bubble burst, and he said, “Good news: you have a great senior project. Bad news: no one will fund this.”

I ended up going to Carnegie Mellon to study networking, and then I got into social networks. My thesis was about representing human relationships in software through graph theory.

Eventually, this led to AddThis. We saw publishers and advertisers trying to engage with these new social networks, so we created simple, embeddable services to make websites social. AddThis became huge, with 15 million websites and 2 billion users, and Oracle eventually acquired it.

Looking back, that whole journey taught me a lot, especially about the difference between being a founder and a CEO. I was a great founder but only an okay CEO at first.

It’s amazing to hear how those early sparks lit the path forward. What was a particularly tough setback you faced, and what did you learn from it?

Some of the harshest lessons came from my first company. Before we raised our first venture round, we had an investor who told us, “No venture capitalists will invest in your company. You need to build something, validate it, sell it to customers, and create a business model from day one. If you’re not going to do that, we won’t give you the next installment.” But, I felt strongly that we needed to go the venture route and build something that could scale, so I chose to pursue that, even though I was broke at the time. It was a high-stakes decision, and luckily, it worked out. That experience taught me that, as a founder and CEO, you have to own your choices and be willing to stand by them, even if it means taking a big risk. You can’t just say, “Well, the investor told me to do it, so my company failed.” It was a great lesson.

Another challenge came during the 2008 downturn. The board and I agreed we had to do layoffs to keep the company going, but I was in my twenties, and I was literally Googling “how to do a layoff.” I asked my board for guidance, but they didn’t give me a step-by-step on how to handle telling my colleagues they had to be let go. It was honestly really difficult. I ended up writing down the names of everyone we had to say goodbye to, kept that list in my desk, and read it every day until we sold the company. It was my way of reminding myself that as a CEO, I have to do everything I can to try to prevent this in the future, and if I can’t prevent it, then I need to know that I did everything I could for the people in my company.

I can definitely see how those experiences influenced your approach to leadership. Were there any mentors or influential figures along the way who helped shape how you lead and view business?

So many. I’m really, really grateful. One who stands out is Ted Leonsis, co-founder of AOL and owner of the Washington Capitals. He taught me the importance of communication and thinking through the impact of what you say before, during, and after. He’s incredibly sharp when it comes to making sure things are kept simple. As an engineer, I always wanted to explain everything under the hood and get into the details, but Ted showed me that people often need the simplest, most direct explanation. I’ve carried that lesson with me ever since.

Nigel Morris, co-founder of Capital One and QED Investors, was another major influence on me. He brought a structured approach to business and opportunities. There’s this idea of “working backward” that Amazon popularized, but Nigel drilled it into me. He’d say, “If we want to build a $100 million business, what has to be true to get there?” Then, we’d break it down from first principles, building it up step-by-step. For example, if we were at $10 million, he’d say, “Now, how do you go from 10 to 20?” That kind of hypothesis-driven, data-focused framework became foundational for me in how I think about business and opportunities, and I’ve carried it into Collective.

How does that work in practice? Do you use a framework before delivering a message, considering its impact across different areas?

I encourage all my leadership to go through an exercise whenever we’re delivering a message or making a decision. For example, if we’re planning a staff reorganization, I’ll start by asking, “What are the three main points we need to convey?” From there, we drill down to the essentials: “What’s happening? Why is it happening?”

Next, we identify the different audience groups – those directly affected and those who aren’t – and tailor the message for each. Key people within the organization, like influencers, then help communicate it to ensure it resonates. And then, of course, we do a post-mortem. We ping people to check if the message landed the right way.

I view communication as an ongoing campaign, not just a one-time announcement. With over 200 employees, we need to meet people where they are. Even if the company receives just one email, there are often five touchpoints behind it. When you do this, it builds continuity, stability, and trust within the organization. Without this planning, you’ll end up cleaning up a mess later.

Can you talk a little about Collective?

Collective is the first online platform specifically designed for “businesses of one” – freelancers, consultants, and solopreneurs. It helps them manage their back-office financials, including formation services, accounting, tax, and payroll. Our main focus is tax. The whole platform is centered around helping members save on taxes. On average, we save each member $10,000 a year, primarily through tax services but also by covering all the necessary groundwork – payroll, accounting, and more.

The platform operates as a subscription service, available on a monthly or annual basis. Our vision is to enable solopreneurs to focus on what they’re passionate about, not their paperwork. That could mean spending more time on their work or with their families. Right now, these individuals spend about one out of every four hours on finance administration. That’s a massive cost in billable hours for someone like a lawyer or therapist, to put it in perspective. So, we’re here to help them reclaim that time and keep more income in their pockets.

What inspired you to start it?

True to its name, Collective is a collective effort. My co-founders and I had the same vision and values, but each of us had different reasons for pursuing it. Personally, I was excited about serving founders at scale. I had been at Expa for a few years, where we served founders, but it was on a smaller scale. I missed the scale I had with AddThis, where I was thinking in terms of millions. I also missed the team dynamics and product-building process.

I started noticing this big, underserved market. There are DIY platforms for consumers, large platforms like NetSuite and SAP for enterprises, and companies like Rippling that are just starting to cover the SMB market. But there was a gap in the middle. My co-founder was a recent immigrant and freelancer from Turkey. He was frustrated because he lost money on taxes and felt the pain of not having a platform that addressed those needs.

So, it was a mix of strategic insight and personal experiences. As we started working with more people, Collective became more personal to me. My parents were solopreneurs, too. My mom ran a sole proprietorship, and my dad ran an S-corp. I realized the challenges they went through, and Collective became a way for me to help people like them.

It sounds like Collective has a strong people-first culture. Have you developed any personal principles that shape how you lead?

I’m very principles-driven, which I got from my dad. He’s very structured in how he approaches relationships, which gave me a values-based framework for decision-making. Being fair and having equanimity is really important to me.

At Collective, “people first” is our top value. We’re all in this together as a team, lifting each other up. I look at it this way: When hiring someone or working with them, I want to ensure they have a positive experience – whether they’re joining or leaving. Do you treat people with the same dignity and respect when they’re leaving as when they’re starting? It’s easy to get lazy at the end, but I believe in taking the time to make sure it’s a respectful process.

We have a growth mindset principle here called kaizen, which is Japanese for continuous improvement. I wrote my college essay on this, and it is personal to me. It allows for failure, which is essential for learning and improvement. If we say we want people to learn, then we have to let them fail sometimes and be structured in how we handle that. It’s challenging, but it’s essential for creating the kind of culture we’re committed to building.

How do you view AI’s impact on the freelance economy, especially for creative solopreneurs?

AI’s impact really depends on the timeframe. If we look at the next 3–5 years, I think AI is going to help solopreneurs drive more value. For example, if a freelance legal consultant uses AI effectively, they should be able to handle more business. They can choose to scale up or increase their profit margin by becoming more efficient.

In a broader sense, AI could allow solopreneurs to manage their work, almost like overseeing a team of independent contractors. They’ll need to set up processes and be specific in how they manage AI tools. I gave a talk about the “one-billion-dollar business of one,” inspired by companies like Instagram, which was 13 people when it sold for over a billion dollars. With AI, we could see solopreneurs building high-value businesses without the need for a large team.

For Collective, this shift could even expand our total addressable market. Instead of hiring a team and moving up to a larger platform, many solopreneurs might stick with us because they only need a few tools. It’s an exciting space to be in.

What kind of legacy do you hope Collective leaves in the business world?

I want Collective to be an enduring company that helps people focus on their passion, not their paperwork. The goal is to make the freelance or solopreneur path as straightforward as a W-2 job, with more money in their pockets, more time with family, and greater fulfillment. It’s about empowering people to live more independent, satisfying lives.

This vision is personal because I’ve seen firsthand how much work goes into running a solo business through my mom, dad, and even my co-founder. I want future generations to have a different experience, where they can just go to Collective and have everything taken care of. They’ll have the benefits of being their own boss but feel like they’re part of a larger team. That’s the legacy I want to leave.

How do you personally define success? For yourself, and for Collective?

For me, success is about actualizing my potential in a way that allows me to provide for my family, not just financially but in a meaningful way that supports their growth and well-being. I think about it as using my creativity to make the world a bit better than when I found it – and enjoying the process along the way.

I’ve learned not to pin my success on external metrics like money or accolades because they can’t be fully controlled. When I was younger, I thought in terms of financial goals, but as I reached those, I realized that chasing a number can feel like a Sisyphean task. There will always be someone wealthier or more successful.

For Collective, I have big ambitions – it could become a $20 billion company, but so many variables are beyond my control, like market conditions, capital, or key personnel. So, I focus on the journey rather than a specific destination. If I wake up each day feeling actualized and find deep satisfaction in my actions, then I’m successful.

Do you have any routines or habits that help you maintain balance as a founder?

I think of balance in terms of “dynamic equilibrium.” It’s not about a static work-life balance but about creating boundaries around my non-negotiables like sleep, exercise, and meditation. These are my anchors. I keep a list of what I want to accomplish on a daily, weekly, monthly, quarterly, and annual basis so I can adapt as needed. If I’m sprinting for a period, I’ll define an end date and return to my usual routine afterward. This allows me to push my limits temporarily but come back to a stable point.

What advice would you give someone just starting their entrepreneurial journey?

Have the courage to start, the strength to persist, and keep a beginner’s mind. Most people fail because they’re unwilling to take risks or give up too soon. But if you reach the top, staying open to learning becomes the differentiator.

I mentioned earlier that one of my biggest lessons was realizing that being a good founder doesn’t necessarily make you a good CEO. Early on, I thought my strengths as a founder would automatically translate to being a great CEO, but that wasn’t the case. Now, I’m constantly seeking feedback and looking for ways to improve. I’ve learned that true growth requires humility and a willingness to continually ask, “What can I do better?”

Let’s end with a fun question. If you could have a conversation with any historical figure, who would it be, and what would you want to learn?

I know this sounds a bit clichéd, but probably Steve Jobs. It’s one of my regrets that I had opportunities to connect with him when he was alive and didn’t.

I’d want to separate the myth from the man and get to know him as a human being. I’d like to understand the challenges he faced, not just the successes. Seeing that someone who built such an iconic company also had human flaws and failures would be grounding. There’s this idea of the “life between press releases.” It’s not just about the highlights but also about navigating the lows, the mistakes, and the lessons learned. Talking to someone like him would reinforce that it’s okay to face setbacks and that learning is often painful but essential.