The biggest mistake this CEO ever made with his own money illustrates the danger of following a hot investing tip

Soon after he graduated college, Eric Dunn, now the CEO of personal finance software company Quicken, committed the "most blatant financial mistake" of his life when he invested blindly in an oil company.

"I had my first job, I had a little bit of money to invest and my grandfather had been in the oil business in Oklahoma in the 1920s or something and sort of earned a living successfully doing that..." Dunn told Farnoosh Torabi on a recent episode of her "So Money" podcast.

"[I] had this romantic vision of the oil business being good," he added.

Despite preconceived notions of an industry or company, anyone looking to invest - especially first timers - would be wise to complete their due diligence, evaluating whether the business has vigilant leadership or a clear long-term prospect.

But for Dunn, a dose of optimism coupled with a push from his broker, who convinced him that the timing was right, was enough to get him to pour $5,000 into a dubious oil concern.

"I wouldn't say it was a scam, but it was a structure built to take advantage of uninformed investors like me," Dunn said. Though his money didn't evaporate immediately, "it withered away and it was a completely failed investment."

Looking back, Dunn calls the experience "good learning for me" and says he now sticks to investing in the businesses he knows best in the technology, software, and payment startup spaces.