Taking Big Risks and Hatching a New Kind of Stock Trading Business

Ryan Downing and Bryan Houlton aren’t the kind of guys who shy away from taking a risk.

“My philosophy is kind of like this,” explained Houlton, who just completed his sophomore year as a computer science major at the University of Maryland. “If I’m going to take a big risk and start something, now is the time.”

Last fall, Houlton and Downing went all-in on the risky business of tech entrepreneurship. They created the quantitative finance platform Quandry and got a running start thanks to the Department of Computer Science’s Mokhtarzada Hatchery incubator for student tech ventures. 

From day one, it’s been a wild ride.

“It’s just been crazy,” Houlton said. “Full calendars every day for us, lots of going back and forth, working long hours, talking to people, managing relationships, just a lot of stuff to consider.”

“It’s definitely been a rollercoaster,” added Downing, who graduated in May with bachelor’s degrees in computer science and finance.

Like any good thrill ride, there has been a surprise or two along the way, including a big one just recently. Quandry was accepted to Y Combinator, a prestigious California-based startup accelerator that has coached and launched more than 3,000 ventures—a program so selective they weren’t sure they had a chance.

“We had a 10-minute video call with some of the Y Combinator group partners,” Houlton recalled, “and we thought the interview went terribly.”

So, when a ringing telephone woke Houlton up the next morning, he was stunned by what came next.

“I answered the phone and it was the guy that interviewed us the day before,” Houlton said. “He asked a few more questions and then he was like, ‘OK, we’d like to fund you.’ It was really surreal. I was still half-asleep, trying to keep up with the conversation and not freak out because that call meant an instant half-million dollars.”

It was the best surprise imaginable: Y Combinator would make a $500,000 investment to help Downing and Houlton launch their company. For the two student entrepreneurs, it validated everything they’d believed in from day one.

“Bryan and I always knew we could build this because that’s kind of where our skill sets lie,” Downing said. “I think that’s something that was reaffirmed after we got accepted into Y Combinator. We always knew we had a good idea; we were going to work our best to build it. And that’s exactly what we’re doing.”

Growing up programming

Downing and Houlton grew up more than a hundred miles from each other—Houlton in rural Pennsylvania, Downing in the Baltimore area. Both spent their middle school and high school years dabbling in programming and looking ahead to a future in technology, even if they weren’t sure what that meant. The two also shared an interest in finance and investing.

“Ever since high school I always thought stock markets and financial trading was a really cool problem,” Downing explained. “It’s kind of like predicting the future in a way, so I was really interested in it.”

During his freshman year at UMD, Downing joined Smith Investment Fund, a student-managed club in the Robert H. Smith School of Business. When Houlton joined the group two years later, the two connected and started doing research together.
“We did a lot of quantitative financing research, and we actually did some systematic training,” Downing explained. “We wanted to take a lot of the work we’ve done in the club and take it to the next level.”

They started kicking around a few startup ideas, focusing on ways they could open up new stock trading opportunities for retail investors.

“Right now, there’s a whole industry called quantitative finance, which is really just trying to figure out how you can buy and sell stocks the best way to make the most money. However, the infrastructure required to do it is often very difficult so it’s kind of locked away where only the JPMorgan’s of the world can do it,” Houlton said. “We wanted to create something to allow anyone to participate in this field of quantitative finance and trading algorithmically.”

A unique opportunity

For Downing and Houlton, plans to build an actual business never really jelled until October 2021 when they saw a unique opportunity at UMD. The Mokhtarzada brothers, experienced entrepreneurs and Maryland alums who turned their financial app Truebill into a billion-dollar company, announced they were launching a startup incubator called the Mokhtarzada Hatchery to pay their own success forward—and student entrepreneurs were encouraged to apply. 

Downing and Houlton did just that—and were chosen as one of four teams that would be mentored in the Hatchery’s inaugural year. 

“For us, the culmination of the brothers and the university coming together to make the Hatchery happen was really a dream come true,” Houlton explained. “We knew we would do this if we got into the Hatchery, and the Mokhtarzadas told us to focus on building the product and making sure we’re delivering something that people want.”

“It was a great experience working alongside the other three Hatchery teams; seeing the updates from them was really motivating for us,” Downing said. “It just pushed us to work harder and deliver more.”

The past year in the Hatchery, working closely with the Mokhtarzadas every step of the way has made a game-changing difference for Quandry’s founders and the company itself.

“They’re our top mentors at this point, the ones we go to the most and that we have the most confidence in,” Houlton said. “It’s been really great working with them and being able to siphon off their experience and hear what they think about decisions we’ve made. We’ve learned about not just the engineering side but also the business side.”

Picking up steam

Fueled by the Mokhtarzadas’ support and guidance, Quandry continued to pick up steam. In April, Downing and Houlton won third place and received the $10,000 Tom Savransky Entrepreneurial Spirit Award in the 2022 Pitch Dingman competition. Then in May, they shared their progress with stakeholders and the local startup community at the Mokhtarzada Hatchery’s Demo Day. Acceptance into the Y Combinator was the icing on the cake.

“I’m still not sure that I’ve fully accepted that we’ve gotten into Y Combinator,” Downing admitted. “But since we got that call, it’s obviously changed things a lot. Trying to react to that event has been really stressful but also really fun.”  

It’s exactly the kind of startup success story the Mokhtarzadas hoped for.

“We started the Hatchery with the mission of incubating latent talent into viable businesses,” said Haroon Mokhtarzada (B.A. ’01, economics). “We are thrilled to see Quandry transform from hobby to a funded Y Combinator startup within six months of being in the program.”

Though it’s not yet officially open for business, the Quandry platform is up and running—in test mode for now—with a functioning website and an ambitious mission—leveraging technology to disrupt traditional trading options, one investor at a time.

“Our mission statement for the company is empowering retail investors with automated investing solutions,” Downing explained. “I really just want to close the gap between big Wall Street companies and retail investors. I think the past few decades we’ve seen the rise of algorithmic trading but there’s been no way for individual investors to really get involved and we really want to close that gap for everyone.”

With Quandry, Downing and Houlton have created a new kind of trading platform.

“You can go onto our website and build out your strategy—right now you have to program it in a language called Python, but we hope to have a drag and drop solution for people as well,” Houlton said. “Then, once you have your strategy you can back-test it against historical market conditions, so you can actually replay the market conditions from 2007 up till now and see how your strategy would perform. If it’s good and you decide to use it, we can connect it directly to your brokerage, like E-Trade, and it can start trading that strategy for you.”

The goal now is to get the word out—and make sure everything’s ready for open beta testing by the end of summer and a public launch later this year. 

Even after the craziness and hard work of the last several months, Downing and Houlton wouldn’t trade this experience for anything.

“It’s definitely been chaotic and busy for sure,” Downing admitted. “But it’s exciting and we’re just really happy to be here.” 

Written by Leslie Miller