How Robinhood Accidentally Became a $100 Billion Company | Vlad Tenev

When Robinhood started, I don't know if you guys know this, but we launched in 2013 as a social network. So, the name before we changed it to Robinhood was Analyst. And the idea was that we have all these retail investors on social media and the internet, and they should have the ability to share their point of view of stocks. So, we took the idea of an institutional analyst—you know, the folks that rate stocks buy, sell, or hold, set price targets—and the attempt was to like democratize that so anyone can be an analyst. We created the social network where people could rate stocks and write comments. Our initial vision was that once we got approved to be a broker, we would sort of layer on trading so you can not only analyze a stock, but you can also buy it and see your real portfolio. And sometimes I think about we ended up making the decision that these are two very complicated businesses independently to put together. And the demand for commission-free trading was so high that we just abandoned all of that for the time being and just focused on making the trade button as simple and streamlined and easy as possible. But sometimes I think about that because it's very much in our DNA to build those types of products. And who knows? Maybe at some point we'll revisit.

And would you sign up for that network and be willing to opt in and share your trades with followers?

...and then you do the opposite.

I think most people would probably want to be known and they could build a following, but yeah, I think I could see the use case for wishing to remain anonymous, too. But I think there that raises a question of like who is this person and why would I follow them, you know?

There was definitely a little bit of a quality of life slip, but I don't know if it was the IPO itself or the timing of it. We went public in July of 2021 at sort of like the peak of the secular bull market before things went really south. And we were actually one of the last IPOs before the window got shut. I think Rivian went after us by a couple of months. But I think the IPO window shut for many, many years shortly after us. And you could tell the vibe was shifting right around the time we were going public. Like we didn't have a particularly hot road show. It wasn't, you know, like some IPOs where it was 60X oversubscribed. So you could tell there was a little bit of a vibe shift. Like everyone was kind of understanding government's printing a lot of money, inflation is creeping up, so something's going to have to change. And so pretty soon after our IPO, our stock took a pretty big hit. You know, we went public at $38 per share. We traded—I was actually looking recently when was the exact day we hit the bottom—mid-2022 we closed at like $6.80-something. So huge drop, right?