The Trillionaire Mindset - 20: Confronting Billionaire CEO of Robinhood

Episode Date: February 11, 2022

Big guest alert! This week Ben and Emil ask the Robinhood CEO, Vlad Tenev, as many questions as they can before his body guards intersect. How large are Vlad's hands? Why did he sell his Robinhood stock at all time lows? Will he give Ben and Emil money?? All this, and more, on this week's Trillionaire Mindset! Listen on Apple Podcasts: http://apple.co/trillionaire Go to https://Stamps.com, click the microphone at the top of the page, and enter code TRILL.  Head to http://www.NetSuite.com/TRILL for this special one-of-a-kind financing offer on the number one Financial System for growing businesses.  Go to https://www.manscaped.com and use code TRILL for 20% off and free shipping.  Trillionaire Highlights Channel: https://www.youtube.com/channel/UC-E2wiM-Dn9TS3bPrhykpJw Trillionaire IG: https://www.instagram.com/trillionairepod/ Trillionaire Twitter: https://twitter.com/trillionairepod TMG Studios YouTube: https://www.youtube.com/tinymeatgang TMG Studios IG: https://www.instagram.com/realtmgstudios/ TMG Studios Twitter: https://twitter.com/realtmgstudios BEN https://www.instagram.com/bencahn/ https://twitter.com/Buncahn EMIL https://www.instagram.com/emilderosa/ https://twitter.com/emilderosa  *DISCLOSURE: THE OPINIONS EXPRESSED IN THIS VIDEO ARE SOLELY THOSE OF THE PARTICIPANTS INVOLVED. THESE OPINIONS DO NOT REFLECT THE OPINIONS OF ANYONE ELSE. THIS IS NOT INVESTMENT ADVICE. THE VIEWER OF THE VIDEO IS RESPONSIBLE FOR CONSIDERING ANY INFORMATION CAREFULLY AND MAKING THEIR OWN DECISIONS TO BUY OR SELL OR HOLD ANY INVESTMENT. SOME OF THE CONTENT OF THIS VIDEO IS CONSIDERED TO BE SATIRE AND MAY NOT BE CONSIDERED FACTUAL AND SHOULD BE TAKEN IN SUCH LIGHT. THE COMMENTS MADE IN THIS VIDEO ARE FOR ENTERTAINMENT PURPOSES ONLY AND ARE NOT MEANT TO BE TAKEN LITERALLY.*

I mean, Robinhood can look right into the camera too. And apologize if you'd like. Yeah, the camera, not the screen. Um, I think if we look back on it, Robinhood is all about the individual investor. We don't want anyone to feel left behind. We think January 28th was an example of what happens when millions of people can access the markets and exercise their right to democratically vote for the companies they believe in. And that's what Robinhood is all about.

It's democracy and capitalism in one. So, you know, it was a perfect day new maw of they got to show you... Yes, we're just like American democracy, where your vote doesn't really matter. AHHHHH! AHHHHH! AHHHHH! The whole sheriff's are just getting hammered this morning. Every day they're pounding it! I'm not fucking late! Just promise! Hell yeah baby. Isn't there supposed to be another person here? Yeah, it's a g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g-g I'm not sure I have a bunch in there. Do you color? No. I'm not sure I have a bunch in there. I'm not sure I have a bunch in there.

I'm not sure I have a bunch in there. I'm not sure I have a bunch in there. I'm not sure I have a bunch in there. I'm not sure I have a bunch in there. I'm not sure I have a bunch in there. I'm not sure I have a bunch in there. I'm not sure I have a bunch in there. I'm not sure I have a bunch in there.

I'm not sure I have a bunch in there. I'm not sure I have a bunch in there. I'm not sure I have a bunch in there. I'm not sure I have a bunch in there. I'm not sure I have a bunch in there. I'm not sure I have a bunch in there. I'm not sure I have a bunch in there. I'm not sure I have a bunch in there.

I'm not sure I have a bunch in there. I'm not sure I have a bunch in there. I'm not sure I have a bunch in there. I'm not sure I have a bunch in there. I'm not sure I have a bunch in there. I'm not sure I have a bunch in there. I've got grays. What's my excuse? Bad genetic set. You're not looking close enough. I'm sure I have a bunch in there. Do you color? No. Okay.

I got tons of gray. And you're younger than you. Yeah, you're what? 37? 34. 34. Damn. You're, wait, am I 34?

Yeah. Wouldn't you birthday? February 13th. Oh my god. It's 35. Wait. Yeah. We're not going to sing 13th. Oh my god. It's three five. Wait. Yeah. We're not going to sing happy birthday. We don't have to do that. Yeah, you don't have to do that. Welcome to the show. We are a bit of an unconventional show, as I'm sure you've probably been briefed.

We are a Christian podcast. So we would like to start with a prayer if you wouldn't mind. Just humorous. Thank you. Lord, we hope that you bless this podcast. Make it fucking, sorry, make it good. Make us look like professionals and not idiots. Please bless Vlad too.

Make sure that he doesn't say anything stupid. Doesn't say anything stupid doesn't say anything stupid I will take care of that part and make it funny make it funny Please help protect us from Vlad's bodyguards. Yeah, yeah, that part especially And your compliance team and our compliance team my eye should be closed Vlad anything to add No, I think let's just make it great. Yeah, I agree with that.

Okay. Okay. For having me here, I love LA. Beautiful weather. Beautiful people, including YouTube. Oh. Okay, cool. Can I get an amen?

Amen. Amen, very much. Oh. Okay, wow. Thank you, Jesus, for all of our blessings. I think you, Jesus. Yeah, so let's just get right into it. Right off the bat, we do, we are contractually obligated

to say Stanford sucks and you suck, we're going there. I'm sorry about that, but. It's a thing, it's just a thing. We're gonna get crucified if we don't tell you you suck. I'm gonna give him an explainer. When we first started the podcast, we were number one on the business charts, due to the fact that we had like unique listeners and stuff.

And we were neck and neck with the Stanford Business School for several weeks. Yeah, okay. And so it became a thing that we hated Stanford Business School. So they do suck. Do you know William Preson by the, I think he graduated in your class.

I don't know. His father created the private prison No, no, okay good guy you should you should William free zone Preson free it's spelled like prison Mark on the oh are you do you know what you're getting into here because we're Like really, but we're not gonna like you know, it's gonna be fine. It's gonna be fine. I'm more concerned for us because this is just embarrassing all around, but we do want to ask, so like, why are you here? You all reached out to us. This is, well, we like what you guys are doing. I know it's a relatively young podcast. What is this episode? 20, you'll be our 20th episode.

Yeah, okay. So for everyone, instead, we wouldn't make it 20. This one's for you. Fuck yourself. Yeah. First of all, I don't do a lot of podcasts. Maybe you've seen some of the ones that I do, but maybe two or three per year, maybe a little bit more.

And I think there's just still a lot of people out there that don't know our mission, don't know what we what we stand for and we're all about. We're all about making it so that young people who have for such a long time been left out of the market and felt like they've been left behind, you know, rich people are out there making money, taking advantage of the financial system, taking advantage of crypto, and making it so that more people figure out how this thing works, and don't get left behind and have an opportunity to make money for themselves in their families. That's what Robinhood's all about. That's what we're about, too. That's what we're about. Like, I'm the trader here, I'm a stock trader. I'm actually a professional licensed trader, which is scary to think about because.

You have a Series 7? I have a Series 57, a prop trader. That's 50 better than a 7. Yeah, it's 50 more. Damn, that's good math. He's a math major. Oh, yeah. Almost a PhD.

Yep, yep. We won't call you doctor, because you didn't make it. I didn't make it. You should go back so people have to call you doctor. Yeah, you know, for a while, my parents were asking me about that, you know, when are you gonna finish your PhD, when are you gonna go back up until very recently, surprisingly recently, but I'm too old to be a mathematician now.

Damn. And then once you hit a billion dollars, I feel like your parents can stop asking you questions. Yeah, they were like, okay, you'd be surprised. Yeah, also we have a bit of a bond to pick you clarified You made us look like assholes. You're not a billionaire anymore. We've heard that's what Forbes magazine says Yeah, I mean, we're pretty pissed because we were like we're gonna have the first billionaire on Like the first billionaire for us and now we've got A 900 millionaire,

and it feels a little shitty. And correct me if I'm wrong, I mean, I might have the math wrong, but to me, 900 of something is more than one of something. So in my mind, 900 million is more than a billion. That's just how the math works for me. Maybe this is good. We've got a 900 millionaire instead of a 1 billionaire.

Yeah, I actually, I forgot for Glenn, please. You got to click the see more button in the disclosure. Yeah, the disclaimer in the description box. Glenn is our compliance guy, my compliance guy for the firmware I trade. Okay, so that was a good answer, thank you. Cause I was gonna ask,

well, did you sell that for us buddy? Cause that would have been, I want to have million dollars. That would have been good for me. Yeah, cause it would feel like it accommodates for the taxes that we would have to pay so that it would be a nice big round number. But it wasn't for us.

And also, yeah, cause I was gonna ask, why would you sell at the bottom? Cause the stock's in the shitter. Yeah, fair enough. Again, there's gonna be a lot of that. And just so you know, you know, it ain't personal team. You got big hands, man. Oh, thank you. Look at those things. Give us give us each one. Well, no, they're a little smaller than your hands In fact a little bigger than yours. Fuck this is

Can we cut that cut that? Because you know what could help so I mean you said it wasn't accurate But just going off what the internet says that you fell below the billion dollar threshold mark. You might have heard of a guy named Elon Musk. I do. I do. There was a thing that he did on a podcast called the Joe Rogan Experience.

Which is also having a little bit of a moment right now. Yeah, yeah. Where he smoked weed on the podcast and it did hurt Tesla stock in the near term. But in the long term, one could say. One could say. Yeah. It's just man in the world.

Oh, and you can draw a straight line from. Absolutely. From doing drugs on a podcast to richest man in the world. And we know that you go ahead. Well, we just want to help you out. So if you would like to do any drugs, our production team, we've got black tar heroin, bad. Ketamine.

Ketamine, fentanyl. Whoa, buddy. Whatever he, I don't have that. Okay, you might be kind of kinky. He's winky at me. We do have it if you want to do it. Yeah, ecstasy. Okay, what about the just regular old, you know,

we got marijuana. Why I thought he wanted to go bigger than you? Yeah, it's definitely nothing personal to you guys. Yeah, I like you guys, but I've been I haven't even had a drink since 2017. Oh, okay. You as a Christian podcast. Oh, yeah, no, yeah, we totally are. Well, all right, we thought we could help with the stock.

There you go. Uh, we do want, I mean, we have some fun getting to know you questions and we will, you know, just to loosen you up a little bit, much like a glass of wine. Yep. I'm not a big drink. It's a little embarrassing. You know, when we were prepping for this, we didn't know. And all these, we have so many like, what's it feel like to be a billionaire? So I guess scratch that. Well, no, I want to, I do like, that's the fun getting to know you stuff. And then we'll get to the, we'll get to the, we'll get to the billionaire anymore. Or you're saying you're sure, I'm not saying anything.

Okay, so do people, like, do people treat you differently? Not only is like the CEO of a publicly traded company, but when you, when you start to reach, reach those upper echelons, I'm assuming that people kind of treat you differently, right? They must, I mean, just us doing the podcast, we get treated a little differently. I walk around people spit on me when I walk down the street. They say, yeah, boo! Fuck you!

Or quit! And so I imagine they must treat you a little differently. I'm not sure, you know. The thing is that I just don't have a ton of time, right? So I spend probably the vast majority of my time at work, like working in the office with other folks from Robinhood, right? So it's hard to separate everything else that's going on from, you know, my status as CEO of Robinhood and all that. Yeah.

Did your life change? I mean, I know that it did, but like, where there are ways that it changed measurably from before. Not really. I mean, go out and buy a McLaren. No, no. So that's not what I would do. I'd buy an old Porsche.

I think what I realize, and maybe this is just me, is the more stuff I have, the more stressful it is. Sure. It's like, you buy a car, now you have a car to maintain. Right? And the thing is, I'm all about simplicity. I want to optimize my life around just doing what I love, which is getting more people into investing, educating people about what the stock market is and how they can empower themselves.

If it makes my life easier, beyond the point where you don't have to worry about rent and food, I'd say it's pretty gravy. So everyone that knows me would probably be surprised at just how frugal I am. So I guess my next question, because how much money have one or not? Yeah, I do, I do. Shut up. This guy, I mean, geez Louise.

I do have an 89 Volvo, I hear what you're saying. And I've been able to afford at least in 92 for quite some time. I love old. Hey, that's a good year. I got a 2008 CRV, about 220,000 miles on it. Damn, why don't you brag about it? People have been begging me to get a new car for years. So I guess, I mean, you sort of answering my next question, which is like, how much money is enough? Is there an amount at which you'd be like, damn, okay, I can just call it a day. I mean, for me, that's like above $10 million,

or like $10 million. You park it all into index funds. Yeah. Yeah, there's a lot of these communities, right? The fire community. Sure. I don't know if you guys have been looking around at those. I mean, there's people, it just depends on your lifestyle, right?

There's people that live in RVs that can retire on much less than that. But for you, how much is enough for you? Uh, because it sounds like you live a bit like an aesthetic. You're explaining you. Yeah, I mean, I wouldn't go that extreme. I don't know. I think that, you know, obviously I wanna make sure

that we have enough to... So just throw a number out. If you don't have an answer, that's fine. Like the billionaire guy who gave away all his money. Now he's got three million less. Three million less. Or left, yeah. Okay, so do people treat you differently, but do you treat people differently now?

I'd like to think no. Yeah, for sure. You're never going to say yes to that one. Yeah. Well, I treat wait staff differently for sure. I just tried to throw it out. You're real quickly to see if I could get you to say something. It's okay.

Yeah, full disclosure. just tried to throw it out, you real quickly to see if I could get you to say something. That's okay. Yeah. Full disclosure. I mean, at this point, after, and we will get around to the thing that, you know what the thing is. You know what the thing is? Yeah. It's, you know, that whole thing with that one thing that happened last year. You know what I mean.

Yeah, that whole thing. Do you ever get yelled at by people in the street? Anybody ever say rude things? Hasn't happened. Wow. Holy shit. Good for you. Because I would think that it'd be like, Wow, holy shit, good for you. Cause I would think that it'd be like, well they can't get near him.

He's got his team. And just so you guys know, you can't see him. They're just off camera, but I've got, he's cute. He's looking at me. Every time I say something, he goes like this. And for the audio listeners, he's dragging its thumb across his neck.

It's quite scary. Signalling to you that you better watch your with the F and mouth. I'll be good, baby. It's a Christian pod. Yeah. You. Yeah.

Your questions from you. Oh, yes. I know if we do want to do you want to do you want to do? I haven't read them yet. I asked my friends. I grew up in New Jersey. So I got a lot of boys back home who were like, you're going to have the vlads, you know, Vlad from Robinhood on. And I said, let me Jersey, so I got a lot of boys back home who were like, you're gonna have the

Vlad, you know, Vlad from Robinhood on and I said, let me know if you guys got any questions. They're pretty insightful, dude. So do you mind if I, you know, kill me if I don't read them out? Let's see, I should have looked at them a little bit more closely. This one's from Fat Mike. Okay, that, less of a question. This one just says you're not better than me. So we'll just skip that one. Okay. This one's from Jeff, aka the dumpster dick. You don't want to know why. He says, oh, this is actually a question. What's it like to be a silicone Valley billionaire? Good question. Oh, is there a meeting you guys have where you discuss how to make your app make people's lives worse? Okay, sorry about that last part. I didn't know they put that one in there.

We can just skip that one, I guess. What is Matt F. Again, not a question. This one's from Matt F. This one just says each shit. Okay, I think you can skip the last one. I think you can skip that last one. Do you want to hear what Johnson's not?

I think these boys, I think these boys, you think these boys... You guys are not a good one. No, it's not nice. I think these boys held some game stuff. I think it's not nice. Before we get into the other stuff, I did want to ask, you know, you mentioned that the thing that you care about is the most is helping people understand stocks.

So were you a trader before? Did you trade? Is that how you got interested in all this? Well, I'll tell you how I got interested in it. So I was born in Bulgaria, as you guys might know, it's a small country in Eastern Europe. And it went through a very difficult time. So right around 1995, it was basically after communism fell apart in Eastern Europe. Bulgaria went through hyperinflation, which meant that the currency basically devalued by a thousand times or something like that. So I'd go to Bulgaria, a big Mac at McDonald's was two levy, right? And then the next year would be two level or something like that. And my grandparents

lived there, right? They were mostly retired at that point. So they had their pensions. And the pensions overnight just went to nothing, right? And I remember what my grandparents were doing to store their wealth was my grandfather was a captain on a ship. And so he would, he knew someone at the port of Varna, which was on the Black Sea coast, and he would take his salary or his pension as soon as he got it and put it into copper cookware. So he'd literally be buying copper plots and pans because they held their value a little bit better than the currency. So, you know, that really stood out to me.

I mean, people don't realize how lucky we are in this country to have access to a currency that's stable. I mean, you know, there's a lot of talk about inflation, and it is scary, but hyperinflation is something very, very different, and it can change people's lives overnight. And if my grandparents didn't have my parents to help them out, we were in America at the time. I mean, it would have been very, very difficult.

So giving people access to ways to invest their money, regardless of how much money they had, because rich people didn't have this problem. You could move money overseas, you could diversify your assets. There's so many things you could do. But for the everyday person who is living on a pension, these types of things can be like just crippling. So I think from a very early age, I learned to appreciate the value of investing and diversifying your assets and, you know, participating and being really savvy about the financial system that we all rely on.

So you weren't a trader. That was an investor. Yeah. That's something that I tried to preach to anyone who ever asks because they, they see my stellar returns. I'm very, very successful. And they ask, how did you do it? Tell me what stocks to buy. How do I turn a thousand dollars into 20,000 dollars?

And the common refrain I've got is just don't do that. Please don't trade, just invest. Because if I had done that, I'd be much more well off than I am today. Which is really fucking annoying. You're making it the hard way. I know, I'm making it the hard way. It's not glorious.

But my plan is that, you know, I've learned how to do this so that over time. Nice. This is the chart. This is the time. And this is my wealth. Right. It'll get to a point where you know I can take advantage of people. Good traits. Oh yeah people too. So let's dive right into the thing. So we just did a recap of in anticipation of this We did and we're about a year out from the whole game stop debacle and we did a recap episode to because it's a very complicated thing and it was you know for the first time people were learning about these concepts and still people

We're asking us if we could just do like a quick breakdown To let them know so we said it's the perfect time because we've got Vlad coming on the show and all worked out and so we said it's the perfect time because we've got Vlad coming on the show, it all worked out. And so we kind of wrapped up our last show. All is it unfolded, the stock started coming down and right before you got, there was the congressional hearing and everything,

so we didn't get any into much of the aftermath, but we'd like to hear your... Might take on it. So maybe, and you guys started this podcast shortly after, right? Yeah, I mean, the conversation started shortly after the GameStop thing and it took a while because you know, you got to work out the business end of it, but we started actually in like August or September of last year. But yeah, it was definitely inspired by a lot of people talking a lot about very complicated things

but still being very, very green as traders. And to me that was cool because it's like, hey, this is shit that only I've been talking about with just my nerdy trader friends online, but now everybody's interested and I can talk someone's zero off about things. I mean, that's a whole other story that I'll get to, not story, but just my anecdotes.

But we wanted to ask you what you're just to give us a brief timeline of what happened. We didn't talk about you too much. You normally get painted as the villain in this whole story. We wanted to hear what you are. Boy, you really do it. It's really wild. People do not. We wanted to hear what you are. Boy, you really do it. It's really wild. People do not, I'll tell you what.

We had mentioned last week that you were gonna be on to talk about it. Yeah. And you owe us like maybe a hundred audience members because there were a bunch of people who were like, unsubscribe, I don't wanna fucking support this anymore if they're gonna talk to Vlad. Only a hundred? I don't know, I don't want to fucking support this anymore if they're going to talk to Vlad. Only a hundred.

I don't know. I don't have the metrics exactly, but there was a lot of comments that were not happy with us. And, you know, here's our shot. Yeah. So, yeah, if you'd like, if you can, walk us through like a rough timeline, please. Well, I think the most important thing to say here is that, I mean, if you look at the whole game stop thing, the whole meme stock movement, it was just like a tremendous triumph

for our mission, right? I mean, think about what happened in a very short amount of time, a gigantic number of people, a lot of whom didn't know anything about investing, maybe had never invested before, had entered the market, exercised their sort of democratic right to essentially support these companies. A lot of these companies or companies that were beaten down by the pandemic. So you started seeing this happening in 2020 when the airlines just got crushed, right? And you saw Warren Buffett selling airline stocks. Right. And you know, back in in previous years, 2008, when there was a stock market crash, the government came

in and bailed out a bunch of companies. You know, they bailed out the banks. They bailed out some of the automakers, right? And nobody was coming in to bail out the airlines, right? Nobody came in to bail out the retailers, the movie chains. And what happened was individuals stepped in. Individuals came in and they said, we love these companies. We don't care about whether Warren Buffett is selling them or hedge funds or shorting them. Actually, we don't like that.

We think that it's unfair that this pandemic happened. We had these shutdowns and these companies are getting penalized. We want them to exist. They wanted these companies like GameStop and AMC to exist. They came in and put their dollars behind that using our platform. Like, a lot of that activity was made possible by our platform. And I think it's just regardless of how it ended. And I know, you know, you want to talk about us restricting stocks and things like that.

But these people basically started a financial revolution, something we haven't seen before. And I think that's actually an awesome thing. If you think about our mission, like we're all about giving individuals the power to change the financial system and to take charge of their own destiny. And that's what we saw.

Sure, I see that as a double-edged sword. I mean, you said regardless of how it ended, and I think it's, I'm shocked as a double-edged sword. Well, I mean, you said regardless of how it ended, and I think it's, I'm shocked that you called a triumph. And yeah, and we're gonna, Well, because on the one hand, you said the missions, you know, it does line up with your mission, and there were people doing exactly what you said,

they felt like getting in and investing in these companies, but undeniably, there were also people who were just like, hey, I heard from my cousin that if I buy a game stop, it's going to go to 100,000 a share. And that's where I said the double-edged sword because it's like, yeah, I got a lot of friends asking me about how to start trading, which is great. But then almost immediately thereafter, it was like, hey, I just got to prove for options trading. Like how do I, and I tell everybody who does that, like, please don't do that. I mean, it took me five years just to get educated on how they, well, not five years to learn

how they work, but to feel comfortable enough to even dip my toes into it. But so just to backtrack a little bit, I have some thoughts, by the way. Yeah. I think that's a great question. It's one that we hear a lot. And what I'd say to that is, it's really democracy.

Like you can say the same thing about, about democracy, right? Um, which not having a great time right now, just, well, you've heard a couple of, a couple of different variants of this, like some people say, uh, the greatest argument against democracy is a conversation with the average voter. You've heard that, right? There's also the statement that democracy is the worst system of government, except for every other system. So, we are gonna have a headline tomorrow of Vlad says the average voter is stupid.

I never said that to be clear. We have it and we'll clear that. That is a wreck. That's not my, not my quote, but I actually disagree with it. I disagree with that quote. And I think that basically you have to choose, right? Would you rather live in a world where everyone has access to the powerful tools that the rich people have to make money on a level playing field?

Or would you rather have a world very much like the world we we've had recently where only rich people and sophisticated people have access to these tools to make money and everyone else is shut out. So I'd say of course there's warts around it, right? Of course there's people that that make bad decisions, but we believe in democracy, right? And I think that's our baseline, that's our standard. And we wanna make sure that we provide the education, we give people tools to get educated, but we think that,

but do you think you can do that? I don't wanna live in a world where only rich people have access to options trading, it's sophisticated financial tools. And the everyday person has like an impossible time accessing them. And I know what you just said is that having access to the education, but that wasn't always the case

with Robinhood, was it? Like when you first launched, it seemed like there was more of a focus on growth and more of a focus on getting people to sign up. You famously had the confetti to celebrate certain milestones. The gamification of trading. Which again is kind of a double edged sword from my perspective because on the one hand you've got very user friendly interface and you were the first of it first of it's kind of do that because like, you know, the brokerage that I use has an app that sucks and the user interface

is not user friendly, especially for a beginner. So can you comment on how, yeah, your guys' approach from the start, how you might have kind of dropped the ball a bit with getting people to... Not gamble, but... I mean, democracy's great, but it sounds like you're offering these tools that and kind of left out some of your own responsibility with what people could use these tools for.

I don't know about that. I mean, when I think there is this beam that, and you heard it before everyone copied our business model before, you know, the legacy brokers dropped commissions, they would say things like, it's good to have a commission because it keeps the people from trading too much, right? If you have a commission, people really think about those trades and they only make trades that are well thought out. And then now you're hearing it about the user interface. You know, it's not good to have a user interface. That's too simple and too easy to use.

Well, to that, I mean, I would say, I've seen this guy trade and it's like, you know, he's putting so much thought into it. He's got, you know, three monitors up. He's watching everything he's possibly watching. And you're saying, oh, you don't need any of that, do it on your phone. Just have a simple little app to do it all. I mean, I think that different people have different access to tools. We have a lot of people that they'll use Robinhood, and maybe they'll have their trading view, or their stock screeners, or their scanners and pretty much everyone has different tools and some of those we bring into the platform right We've been adding more data more information to help people make decisions But I think there's there's also something to be said for

This just being a false narrative like the brokers weren't charging commissions to make it so that You think really hard about every trade. They're charging commissions because they wanted to make more money. Sure, and we're not saying that the brokers had it figured out. And they don't have, you know, poor user interfaces. We're not here to be like, why don't you do it like the brokers? We're curious about, and we're getting away from the GameStop thing, and that's fine. We can come back to it.

But like we're talking about, you democratizing finance, which is a noble mission, but we're wondering if you guys missed any marks along the way, right? Because, you know, and for me, it was pretty eye-opening. We were doing a little research, and what I found out was, you know, people weren't only pissed about GameStop. You've been in, you know, you've been at the center of controversy before all that. There's been a lot of SEC probes. I mean, I just found out you had the, I think the largest fine from Finra ever. Yeah, that's true. That's a pretty, you know, that's a nice little record that rather holds. Correct me if I'm wrong. Part of that was because when a broker executes a trade on behalf of a client, they're either charging commission or they're funneling it,

payment for order flow style. And when you do payment for order flow style, you've got to disclose that. And is, is that what Robin Hood neglected to do? And for which you guys got fined? Well, I'd say there, there are a lot of things in that order. I don't know if you guys have read it, but it's just like a collection of some of it right here. The fineron Wednesday, 11th, it's the largest fine ever against popular

investing app Robinhood known for letting customers trade stocks. Thorn app will pay 57 million dollars in fines in addition to 12.6 million dollars in restitution to customers. Yeah. Democritizing finance. Over the course of its investigation, Finra found that Robinhood violated regulations and showed false and misleading information to customers. That's not great.

Which, yeah, which... Some customers were allowed to place trades with borrowed money, even though they'd turned off that setting in the app, according to Finra. So, this is the kind of stuff we're trying to get at. We love democratizing finance and giving people access and stuff. So what did you guys make mistakes? Certainly we've made mistakes.

I mean, we operate software, we have a service. A lot of times there's bugs in that software and we've gotten a lot better at this over time. But what I'd say is that it's a mission that we believe in, getting people into the markets, giving them tools that only rich people have had access to in the past. And we have to work within the system. There's a lot of rules. There's a lot of legacy that we have to work around. It's true for how we make money. It's true for the things around the game stop stuff.

And it's a long-term game for us, right? If we want to change the system, it's not always going to be easy. It's not always going to be forward progress. Sometimes we'll have setbacks, but we really believe in this, and we think that we've made a ton of progress thus far, and there's a lot more to do. But we're not going to, I mean, it's not going to involve doing everything right, but we have to learn from our mistakes and improve.

Right, and I wouldn't ask you to do everything right. But I mean, I think it's a little I would get asked. I mean, honestly, I would. I have to do everything right. I think I would ask you to do everything right. You're asking people to, and that's the thing. We asked you why you're here. And you said you want to talk about the Robin Hood mission. And you know, I think I would ask you to do everything right and make sure that the, you're asking people to use your app to put their money in and to potentially lose some money, right? And so I think at the very least, that app wouldn't be buggy to the point of showing people

like massive mistakes. Yeah. I think that's very fair, but what I can. And I think we get, I think it could be very frustrating hearing someone say something like, you know, just like, oh, this is unacceptable. All you get is a blog post on Robinhood. I think that's probably really unsatisfying

to users of your app. And that lends itself to a question I have is like, what, what, what can Robinhood do in your view to make up for that kind of thing? I mean, you've implemented changes. I know that when you log on as a new user, you're, you're given a questionnaire to build a profile around who you are as an, as an investor, as a trader, measure your level of sophistication. Then it funnels you.

I mean, you have the option to opt out, opt out, but it funnels you toward low cost safer ETFs. Yeah, we built that product recently. We're very excited about it. So it actually, one of the things that's... I think that that's a good thing. Yeah, one of the things that's very hard as a broker is making investment recommendations. Maybe you know about this, but brokers historically,

stay away from that because, you know, they want to be in a position where people make their own decisions, and they just give you the information. And we asked ourselves, with this product, how can we actually embrace it? Like, let's give people recommendations. And especially for the people that want to invest, but they don't know how to start. Maybe they don't have a specific stock that they want to buy. We have a lot of those people. A lot of first timers know that they want to invest but they want a little bit of help finding the right things to take the first step on. So I think investment recommendations and giving them

a diversified portfolio of four or five ETFs is just a really powerful thing. And that's great. And I think what Emil is getting at is it almost seems... Well, here I can get to it. So, I mean, yeah, I've just, I mean, so I was reading a lot about you and I think I was most interested in the game-stop stuff. And I honestly think I became way more interested in your guys founding story and kind of these earlier controversies. Um, you know, I think it was a Huffington Post profile. You and, uh, Bayzu did, uh, am I saying that right? Bayzu Bayzu. Sorry about that. Uh, you and Bayzu did and there, you

know, you guys were saying that Occupy Wall Street was a big... A lot of people don't remember Occupy Wall Street now. I think plenty of people remember Occupy Wall Street and I'm curious what about Occupy Wall Street inspired you guys. I mean, I remember back... Because I don't remember everyone being like, we need access to financial instruments. Yeah. Well, if you look back in 2008 and the financial crisis, and I know we talked about this

a little bit earlier, but what happened was people didn't really understand the source of this. They knew that the banks were selling mortgage-backed securities. Uh, there was a lot of collateralized debt obligations and they brought the system down, rent, and the government came in and bailed out the banks and, uh, pumped a lot of money into the system. I think people remember that very clearly. Like, I think when you're talking about like people not remembering Occupy Wall Street and all this, I think people remember all of that very clearly. And I think when you're talking about like people not remembering occupied Wall Street and all this, I think people remember all of that very clearly. And I think that's some people do.

But I think that's what you have some people that were like four when, when, when I think a large portion of why we're at today is people remembering being left out in dust when, absolutely. The world economy went into a tailspin. So they were left out in the dust. Nobody really got punished.

And the bankers were not. The bankers were not. Right. And you saw the recovery from that, right? The market bottomed in 2008, 2009. And then the recovery accrued to rich people, the people that were already at the top. And why did that happen?

Well, because rich people own stocks and the recovery helped people that own stocks. And so that led to the Occupy Wall Street movement, you know, young people. And a lot of our friends at the time, we were in New York starting, we were working on another business. And I remember, you know, our apartment was in Brooklyn. We had a small co-working space in Manhattan, and we would walk through Zucati Park. We would walk through the tents, right? And it was young people. And you went one day I'm going to be one of those bankers in the campaign. No, I mean, I'm just messing with you, Brad. Yeah, definitely not. But,

you know, these were people that looked at financial services and said, like, this isn't serving me, right? Who is this serving? And there were quite literally occupying it. And that, that sort of clicked something in our heads and it made us realize, well, what is this going to actually achieve? Like the way you really occupy it is you actually get these people to start investing and to benefit just like the wealthy people and the institutions do from a rising stock market by having them participate and join the market. Now the problem was nobody trusted the financial institutions. The stock market was really meant for rich people. You're being charged $10 every time you trade.

They had account minimums of thousands of dollars at the time. And nobody was building great products. So that we set out to fix that. So you guys saw it and said, we're going to give everyone stocks. Yeah, we're going to give everyone access to stocks on a level playing field. And at first, it was baby steps, right? We started with stocks, we started with iPhone users only, but you look at the platform now

and we have real-time fractional shares. So even some stocks that are too expensive for people to buy a whole share of, you have Berkshire Hathaway shares, for example, Amazon companies that were trading at thousands or hundreds of thousands per share. And we break them apart, allow you to buy a dollar amount of that stock as easily as you would buy a whole share with great pricing and no commissions.

So it's literally never been easier or better, value wise to be an investor. And it's not just Robinhood, like lots of companies have sort of co-opted, and adopted this cause. And we saw last year, it turned into a mass movement where more young people have been investing, more diverse people have been investing than ever before. It seems like there was a, because I hear what you're saying and I agree, there have been,

again, the critics of Robin Hood would say that the gamification of something complex, like trading, like investing, is akin to giving a 12 year old the keys to a sports car. Which is like, sure, but also, I mean, that's what you're gonna say as a paid investment advisor where you don't want people to do it for themselves. But then me also as a trader, it scares the shit out of me when someone I know says like, hey, what stock should I buy? And I go, okay, well, what's your objective? Are you trying to be a trader?

Or are you trying to be an investor? Because if you're an investor, you should do blah, blah, blah. So it seems like there were perhaps certain things that you guys just didn't see that maybe you should have seen, like especially me as a trader knowing, okay, people are fucking gambler degenerates, you know, if you give them access to this stuff, they're not gonna necessarily be like, oh,

I hit my milestones, it's gonna be like, all right, I can fucking trade. Let me just like trade. But it's also like some people do that, some people don't. You might get to 12 year old who hops behind the wheel of the portion goes, baby, I'm gonna cruise 25 miles per hour down this residential street and stop fully at every stop sign. No one's doing that. That's baby shit. People, that's baby shit.

Yeah. But like, it seems like you guys really could have benefited from having way better quality control. You needed a product manager like me, honestly, to get it in time serious, to get in there, experiment, not, I'm not saying that you didn't, but I'm just the best. That's the question. I guess I don't even know what question I'm getting. I'm, whoa, hold on, hold on.

It's like you guys could have had a better compliance person. Glenn, shout out to you. You should have been the compliance guy to check the shit that they got find on. Yeah, folks, those are, we beat our fin run investigation. We didn't have a sign. We're no longer under investigation. No fines.

I don't know what this guy's doing. I don't know how you guys. We racked up like fucking 59 million. But it seems like there were plenty of cases, repeated cases where it was like, damn, where was the quality control? Not the quality control, the right thing I'm looking for. Yes, people using every possible angle in the app to catch any and all bugs that

would show improper account balances, options, errors that could be catastrophic. You know, all sorts of like, where do you guys think that you failed and how have you fixed it to ensure that that kind of shit doesn't happen going forward? Because that's like one of the biggest problems, I think, to giving the 12-year-old the keys to the Porsche. And do you guys think you failed? To be clear, 12-year-olds can't use Robinhood. You have to be 18. So the people using Robinhood are definitely adults, right? But yeah, to your question, I mean, we remember all of the issues that we've had, you know, we remember the dates.

Name them first March, March 2nd, 2020 was a big one. Bruto. You remember March 2nd, 2020? I believe that was when the market just about bottomed. So the market, actually, I think on that particular day, it was written in the papers as the largest single day point gain in the big indices. So the market actually went up, but yeah, there was so much volume on our systems. This was right at the beginning of the pandemic.

The market had crashed and was very volatile. People were, there were lockdowns. beginning of the pandemic, the market had crashed and was very volatile. People were, there were lockdowns. So we had a lot of activity. A lot of people just rushed into the platform. Sure. And we had basically a full trading day outage, which was very tough, right?

But, you know, it was hard to plan for, hard to anticipate all of these things coming together. And we responded to it. You know, we rebuilt so much of our infrastructure. We added lots and lots of people making sure to shore up the software and the tools. But I guess we're talking about more about the times where you didn't respond to it. Well, I'd like to think we've always responded to it. Right? So, I mean, we operate software. We serve a lot of people. We've had a lot of growth. So, yeah, and nothing is going to be perfect with any piece of software, but we always try

to do what's what's best for customers. Do you think you fell victim to the whole, you know, Silicon Valley growth, growth growth, and didn't pay enough attention to your own Technology and investing in your technology to make sure you didn't have these kind of problems. Well from the very beginning We've invested a lot in technology, but well cuz from the New York Times article four of your employees Said the outage like said one of these outages was rooted in issues with the company's phone app and servers They said the startup had under invested in technology and moved too quickly rather than carefully I phone app and servers, they set the startup it under invested in technology and move too quickly rather than carefully. I think it's always easy to say this stuff in hindsight, right? When you have an outage that you should have invested more. And I think there's always things that looking back we could have done better.

But what we can do is learn from them and make sure that we do what we can to to make it so that they don't happen again and you know since It's funny to talk about January 28th, right? our previous big Sort of defining moment the March March 2nd 2020 it was it was about our systems not being able to handle the volume Well January 28 about our systems not being able to handle the volume. Well, January 28, our system saw of 2021 around the GameStop events orders of magnitude more volume. Right. And, you know, we were, we were definitely all hands on deck trying to make sure the systems

were up and people could have access to their accounts, and we didn't have any system-wide outages. So we had basically fixed a lot of the problems from before, but of course, any time you run into a new situation, you get new types of problems, and you have to address those as they come up. Sure. So speaking of January 28th, we got to talk about just the timeline timeline because leading up, it was it first, a quiet kind of thing. You had the guy who oddly enough kind of looks like you. That's sure. I mean, that's a thing. And then it's a simulation, right?

The universe working in unexpected ways. Sure. And I do also have to point out there's a beautiful poetic irony in Robinhood essentially creating the very thing that led to this big backlash against it because you guys gave all these apes for lack of, they call themselves apes. Well, all these people, you gave a ton of people access to a thing that I don't think anybody fully understood. I don't think anybody could have seen coming because I mean me and my infinite wisdom and my years of experience. God provides. God provides.

I was going to say Allahu Akbar. Well, that doesn't, it's not bad. It just means, you know, ask the fucking question. Sorry. Well, that doesn't, it's not bad. It just means, you know, ask the fucking question. Sorry, I mean, I lost my train of thought, but I guess you were talking about the poetic irony in Robinhood creating the thing that would eventually kind of, it was Frankenstein's monster.

And Frankenstein's monster famously goes back and kills Dr. Frankenstein. He doesn't't I think he goes on and marries a Zombie or something right what happens in Frankenstein a Frankenstein fucks the monster. Oh, yeah That's right and then I had a baby and that baby was Robinhood was Robinhood That's right. I was gonna say was games up. Can you just walk us through? Fuckin no uncertain terms and no uncertain terms the timeline from just before it got to chaos, leading up to January 28th, the decisions that you guys made as a company,

and we'll ask you questions along the way, because that's what people wanna know, and I'm sure you've done it so many fucking times that you're in the shower pounding against the tiles. Give them something before you explain this. What do you, no, the gift? Yeah. No, no, that's going to come later.

Well, I feel like I can I tell you that it's because it's going to come as the prize. It's a prize. Yeah. Okay. Sure. Remember I feel like we're wasting a good opportunity here, but I was wait for the prize for the game.

We have a small game to play, but it's it's fine. So walk us through it. Nothing gross. It's a little gross. It's not gross. Now nervous. Let's fine. So walk us through it. Nothing gross. It's a little gross. It's not gross. Now I'm nervous. Um, let's see. So how, how, how early should I start? I guess I talked a little bit about, you know, the pandemic and the companies that have been

hit hard by it. Let's start January 2021. Yeah. It's starting to bubble up. It's starting to become increasingly more mainstream as GameStop is like, I remember for me it was when it was $19 a share, I think around January 5th. And I was like, hot diggity dog. I saw that the, I mean, I personally fucked up big time.

I had 5,000 shares at like 16 bucks. Okay. And I got fucking locked out of your app. I couldn't get in. I was trying to buy one on January 5th. No, no, no, no. On the 28th. On the 28th. On the 28th. On the 28th. On the 28th. On the 28th. On the to buy one on January 5th. No, no, no, no, no, no, no, like the 26 or 12.

They saw the this guy's idiot. We don't get to prove my stuff. I don't know if you guys looked at my data. So I have what a moron I was, but they saw through your camera. They were looking through your front facing camera. They're like, I'm one of these people who would have gladly bought it 500 and held. Yeah. So yeah, let's start. Yeah. When when the squeeze started, it was, let's just call it in the $20 range. I mean, you guys obviously were probably thrilled beyond belief because more and more people are, by the day, I'm sure, a downloading

Robinhood to participate to buy shares. Yeah, it was really exciting. I mean, people were using our platform and while we weren't, we weren't the revolutionaries, in a sense, we weren't the ones holding the spears and doing this battle. So you still very much believe that these people were revolutionaries. Because it's fun. We were talking about this.

There's a, there's a thousand different takes. Some people are like, this is a proletarian revolution. The other ones are like, this is a bunch of morons on the internet. I think it was both. Well, I'm actually going. Oh, sorry, sorry. Well, the question was geared toward me, but no, it was not at all.

Can you call the revolutionaries? No, I'm keeping. Certainly that was one of the story lines, right? That people were using our platform to take down the hedge funds. So what are you, and I think you saw that happening, right? A lot of hedge funds had really big, how do I view them?

Yes. Yeah, I would say that this was a financial revolution of sorts. Okay. A working class revolution. Yeah, and a lot of a lot of the meme stock companies, a lot of the meme stocks were companies that were sort of battered by the pandemic. You know, nobody was going to buy video games at a store. Nobody was going to movies at the time. And a lot of these companies had no control over that situation. There were government mandated lockdowns that basically put them out of business.

So I think that, I think the people believed in them and wanted to keep them around. And there was a whole element of sticking it to the man, the establishment, the hedge funds as well. whole element of sticking it to the man, the establishment, the hedge funds as well. We love to stick it to the man. Yeah. So timeline. So, you know, we saw that happening in January. I think the back in December, it was starting to pick up steam on Reddit and Discord and all the other social media sites. And we saw our traffic just increasing right around the start of the new year.

And there was a lot happening in crypto as well at the same time, so it was kind of the perfect store. And Robinhood was climbing up the App Store charts, right? It used to be, if you look at the App Store charts, you know, it was in maybe the 20th spot at the beginning of the year. And I don't know if a brokerage has ever been in the number one spot before, but you know, the number one apps on the App Store were all tick-tock and Instagram and sort of the big social media platforms that grow virally.

And pretty soon Robinhood was number one overall on the App Store, the number one free app. I mean, we were getting millions of downloads. And you might think like, this is all very exciting. You guys must have been celebrating. But it was actually, I mean, we were all hands on deck trying to make sure that what happened in March of the previous year with our service being down didn't happen again. You guys find yourselves all hands on deck a lot. Hopefully less and less now.

I think we've made a ton of progress. But, you know, I don't think a brokerage had ever been the number one free app on the App Store before. And there's good that comes with that. There's also a lot of challenges. So we were, we wanted to make sure we kept the service alive and well and that people could access their stocks,

buy them and sell them whenever they wanted. That was top priority. And you know, it was, it was definitely, yeah, it was definitely a very high octade environment. January 27th, you kind of saw a bunch of weird stuff started happening that day. And we actually weren't sure what was going on. I think Discord locked out Wall Street bets. I think the Reddit, the subreddit went down for some reason as well. And it wasn't, we weren't really sure what the reason was, but we were.

Just because they kept using the R word, though. It could have, it could have been that, but there were a lot, that was kind of the beginning of the conspiracy theories, right? Where people were like, hey, the government maybe K-Bidden and force them to shut this down. Right. But we weren't sure. We were tracking it online like everyone else. But, you know, I remember discord shutting down Wall Street bets. I remember Reddit taking it offline. And then, you know, as I've said, as I've gone through so many times, I get woken up. So I haven't been getting much sleep those days, but I tried to get a couple of hours of sleep.

Right. And, um, I get woken up at, I want to say five in the morning, sometime around five, five, 30. And my phone is just buzzing uncontrollably. Like, have you ever seen on social media when some celebrity, like the Kardashians post something on Instagram and then you just see their notifications buzzing. That was easy. Well, you had posted that sexy shirtless pic

Yeah, before and maybe that's the only one I picked it up posted asked to the timeline. He posted asked So so essentially my phone was unusable right text messages coming in random phone calls from block numbers and You know, I was trying to get in touch with my team, right? And people were calling me from work, but every two seconds, I would just get a call from an unknown number, a text. So I had to sort that out. But basically by the time I was awake, the conspiracy theory that, you know, Robin Hood sided with the hedge funds to shut down trading. You and Ken Griffin on the phone. Yeah, exactly.

That stuff. And also there was one about the White House calling me to shut it down. I don't know if you guys saw that circulating, but the conspiracy theory is that Joe Biden, Ken Griffin. All around the table talking about restricting stocks. Really? Well, so wait so we're gonna clip that.

Yeah, wow, you can't believe it, you admit it. So your phone's blown up on the morning of January 28th. Is that because people on your team have already gotten the call from the DTCC to halt trading? It was beyond that. I think we had already. This is 5 a.m. East Coast time.

Pacific Pacific time. Okay. So trading had already been open. Pre-market trading had already been open for what a couple hours? Well Robinhoods are one market. And you're snoozing on it. Started at six. So no, it was pre pre pre market. Gotcha. Yeah. And yeah, I mean, by that time, they had already made the decision to restrict. And you know, I'm, I'm not a broker. I'm not the president of the clearing firm. So I wasn't the one that made the decision, right? It was a clearing firm. Ken Griffin was. No.

But yeah, the conspiracy theory basically had taken hold while it was before, before I even got a chance to connect with the team. And so from that point on, we were sort of like trying to get the story out, but you know, it's always difficult to explain to people when you're competing against such an exciting conspiracy story. People love to believe that, right? The hedge funds somehow colluded with these people to shut down the little guy. But the real story was, I guess, much more boring and pedantic and less interesting. So, there's still people that... So we think.

...to this very day. You're telling us. There's many people to this day that believe that we were colluding with hedge funds. Even though when you look at everything that Robinhood stands for and, you know, who we are, we're all about empowering the little guy and giving them access and giving them a chance to... So do you think you failed by restricting that access? I mean, I think if we look back on it, certainly we would have liked to not have to do that,

but that's where you get into the reality of us being a disruptor, having to deal with the rules of a legacy financial system, right? We have to abide by these rules. We are working from within the system itself, and there's a lot of things that are just old and crafty and not built for what we saw in January. So, what does crafty mean? What does craftty mean? Krutty means just like it was intended for a different time. Cool. For institutions trading very normally and not piling into a handful of stocks at the

same time and large numbers. For those of, I can't remember if we touched on this before, but so my understanding of, because I admittedly, when January 28th happened, I remember sitting at home in my chat rooms with all my little nerdy trading buddies going, this is shady as hell. This is what timing like wow, they're turning off the buy button. It's literally all they could do to stop this because that day the VIX was up like 66% because the degrosing trade was the big, was the buzz of Wall Street is that someone is so fucked Some hedge fund or funds are so fucked that they've got a dump

Everything that they've got but so T plus two you trade and then two more days until you actually own the shares and in that two two day period is where Robinhood is on the hook for the amount of money. We have to put up the money for the trades. You have to put up the collateral. Out of corporate cash. Yeah. The clearing house came to not only you,

but to every other broker. We bull, Etoro, Etre, Schwab, all of them. And said, hey, you guys gotta put, there's too much risk because they will do that, especially when it's incredibly one sided, like it was with GameStop and all the other media. Well, it's, it's just a formula. It's, it's rules based, right?

They don't really have a ton of discretion. And I'll tell you where this came about, oddly enough, have you guys ever heard of a, of a law called Dodd Frank? Mm-hmm. Yes. So Dodd-Frank. In the wake of 2008, they wanted to make sure that financial institutions were robust and had plenty of capital in case, you know, things went haywire because they didn't want another Lehman Brothers situation.

So oddly enough, the rules for how much cash you have to put up to maintain the trading activity were actually created to prevent that type of situation. And of course, nobody anticipated a situation like meme stocks. And we found ourselves actually at a time when And we found ourselves actually at a time when, you know, the activity legitimately, maybe there was some risk to it. Like there was some risk of people funding their accounts, buying these meme stocks that were super high.

And then maybe the trade didn't go in the direction they wanted and they would go and reverse their deposit, right? But I think that risk was substantially lower than what Dodd-Frank was created to address. But really, you were talking about, you mentioned settlement. I think that helps solve it. If we improve the settlement structure

that the market uses, which is really, you know, it doesn't make any sense. We have all of this technology and it still takes two days for trades to settle. And there's lots of people that like for it to take two days, but we think that it should be done in real time. And I think that would alleviate a lot of these problems. Sure. So a big

question that I have, what do you think would have happened if you guys hadn't done anything? If you had not turned off the buy button, if you had just let it continue to go unchecked, what do you personally think would have happened to the to game stop to the markets? And are you talking about to Robinhood? For example, if we just didn't pay our calls, I guess if the system had been different. If the system had been different and you didn't need that collateral and if you had been better prepared,

because I understand when you say that nobody could have seen this coming, because truly nobody could have seen something like that coming. But also, it's like, how come you didn't when the stock was at 200 a share in 250 and in getting up there, wouldn't that was just like a day before, right? That's true. But weren't you guys starting to prepare to raise cash?

We did, we did end up raising a lot of $1 billion. More, I think $3.6 billion by the end of the weekend. And yeah, I mean, it's very hard to raise that type of cash in such a short time. I've been trying to donate again, trying to sound Venmo. But so, yeah, what would what do you believe would have happened? Because everybody seems to believe that GameStop would have squeezed to a million dollars a share. Everybody but who would have been rich beyond belief. And I think that if that were true, also then the degrosing trade would have taken its effect

and it very well could have crashed the markets. And that's not to say that that would have been the fault of the game stop traders, because I know people reamed me for that last time. I'm just saying that that's what the effect very well may have been. So what do you think would have happened if you guys had never turned off the buy button and if collateral weren't an issue?

It's really hard to speculate on that. I mean, sure. I would say that if you look at the SEC actually rolled a roll data report on the GameStop January 28th events a few months ago. I think it was September of last year. And, you know, there was all this talk about a short squeeze, the short covering. But then if you look at the data, very little of it was actually short covering. Most of the, of the short, most of the hedge funds that had short positions had closed them out earlier in that week, right? Melvin Capital,

for instance, I think closed their position on Monday or Tuesday. So that was the story, but really what they found was a lot of the price increase was people just buying, right? Retail investors just buying an option at that point. I don't know if the options were actually a big part of it. I mean, maybe they were. I don't, I think it was mostly just the underlying. But what would have happened? You look at Tesla, the same kind of thing happened with Tesla with options and with people

buying it. Well, I think that was actually a short squeeze. Yeah. And I haven't seen the data on that, but I wouldn't be surprised if they were quite a bit different. So what would have happened? So much of it has to do with the psychology, since the buying was due to individual investors,

just jumping on it. And, you know, I don't know know, I don't know what would have happened had no trading restrictions been made by other brokers. Like, do you think that there was a systemic risk in having it squeezed to infinity? I mean, I guess obviously there is, right? The de-grossing trade felt like a very real possibility and that's kind of what what the you know the mumblings about Wall Street were was like oh shit maybe this is the real deal

here right? Yeah well that that's why I think it's hard to to do this in hypothetical. Had there been no requirements, no restrictions, you don't know what would have happened. Right. So there are people out there who truly believe that you personally Robbed them of millions of dollars Dave Portnoy who sucks ass Lost 700,000 dollars good But like how do you respond to that when people point the finger at you because you were you were said you should be in jail Yeah, he said you should be in jail, bub Yeah

He certainly did say that didn't he yeah, but like what do you know? I remember getting much worse messages than that when I When I was awakened at five in the morning by my buzzing phone I'm sure so like how do you respond to those people who say, who have a personal hatred for you because of this, who believe that you pulled the rug on what could have changed their lives? And what you're calling a revolution, a financial revolution? Yeah.

I mean, I think that the biggest thing on our minds at the time was, first of all, making sure that customers had access to their accounts, they could close their positions. Right. And I know a lot of people ask, like, why didn't you close down both sides of the trade? Yes. I think this was, this was something that Portanoi was all about like why just you know prevent people from buying and it wasn't it wasn't really us preventing people from buying it was just us preventing people from opening new positions. So put options for example, we're also you couldn't open up a new put option position at the time on Robinhood. So we closed down both

shorts and longs even though any new position even though Robinhood doesn't support shorting But if we had supported shorting my guesses we would have we have stopped initiating that position too so the reason behind that is people could technically open accounts at other brokers and buy GameStop or AMC, right? I mean most people were using Robinhood a lot of other brokers also ended up shutting down access because they couldn't handle it either But the worst thing to do is to prevent someone from selling stock that they want to get out of because we weren't the only place that allowed people to buy all these stocks. So if people really wanted to, they could have opened a brokerage account and bought GameStop. I was able to,

yeah, trade freely on my platform. Yeah. So there were lots of places where you can buy. If you own GameStop or AMC or any of these other stocks on Robinhood You could only sell on Robinhood, right? Right. So that that's why That's why I think Preventing people from selling was not something that we wanted to do So what do I say to the person to your question? I mean, Robinhood is- You can look right into the camera too. And apologize if you'd like.

Yeah, the camera, not the screen. I think if we look back on it, Robinhood is all about the individual investor. We don't want anyone to feel left behind. We think January 28th was an example of what happens when millions of people can access the markets and exercise their right to democratically vote for the companies they believe in. That's what Robinhood is all about. It's democracy and capitalism

in one. So you know, we obviously could have done things differently. In a sense, we lost the battle. There is a perfect day new maw of they got to show you, yes, we're just like American democracy where your vote doesn't really matter. And look, I think the best thing we can do is try to improve, improve the system, make it so that it really works for retail investors to do whatever they want to do. And you know, that's why I've supported moving to T plus zero, fixing the settlement cycle. And also why we capitalize the business with a ton of money, right, Where we raised over $3 billion to make sure that if something like this were to happen again, we would just have a bulletproof balance sheet. The only type of balance sheet worth having.

All right. So we're getting, we want to play a game with you. We're getting pressured. You have a hard out. We have, we have truly a million more questions for you. We, well, should we do every so often. It's very fun. Yeah, where we have you, guess, I have to be very careful here.

Oh, no, it's okay. You're not going to be, well, look at us up there. Hey, boy, baby, I don't even drink and look at that pathetic thing. So we've got some charts here that we'll be pulling up any second now. And we're going to add a number of things. Well, look at us up there. Hey, boy, baby, I don't even drink in, look at that pathetic thing. So we've got some charts here that will be pulling up any second now. And we're gonna ask you to,

we're gonna see if you can guess the chart. Yeah, there's just a simple. There's a prize at the end of it. Yeah, I of course know what these charts are because I, I don't, I haven't cheated. I can try to. You, you've got a good idea of where this is going. I'm sure.

No, I don't. What's going on with the charts? Yeah, there we go. Oh, there's the first one. This is actually a pretty good one. I'm gonna take a guess. This is a date, these are all daily charts. Wait, I think I know what it is.

What? Am I right? I cannot say, what do you think, Vlad? I have no idea. Because we got no price. You throw out a guess. It's been in a downtrend, recent little spike. I don't even know if I can mention individual stocks.

Oh, I don't know. Oh my God. Oh my God. Oh, fun. Vincere, Vincere has already got you on the line for 60 million. Just have a little time left. It's just a guess.

Is it a fitness company? Yes it is. Yes, all right, he got it. It's Peloton. Okay, what's the next one? What have we got? Oh, another one that's going down. Woo, it certainly does.

If Peloton was any kind of, that was a good guess and it's in the similar vein. It's an optically growth stock. It is clearly a growth stock. that has recently fallen from grace. Any come to mind? This is for Vlad to guess. Well, I want to have a little fun. Yeah, you should have fun.

You know, I kind of got the first one. Well, I had already gotten it before too. Oh, yeah. You go. Come on. I mean, this one, this is really hard to say. I don't know. It just looks like Looks like there was a little downtrend there. Mm-hmm. Is it a

social media company? Oh, no, what is it? It's zoom. Oh Okay, technologies. What's the next one? What's the next one we've got here? This one's gonna be Look at this one up like a rocket. Yeah, wow holy shit. This one has to be What do you think for the audio listener? This one is having a very good. Yeah, this one looks like it's having a solid rock solid uptrend is it upside down? How did you know that huh? It It is inverted. Yeah. It is the Robin Hood stock chart, but inverted. There's the actual. Hey, we got a little bit of it. Yeah. You recognize your stock. You know, I knew what gave it away. Those two big, those two big

candles when when you guys first IPO'd, huh? You were like, I knew those candles because they were just in my dreams So the longest time and I would recognize them anywhere you've been inverted you didn't think that uh, yeah You didn't think that I would get that knows the colors. I was a little bit Confused to see the green candles fuck going down fuck me god damn. I fucked up. Yeah, but you can't even match your You're what a thought the math PhD dropout. You're people informed us you're not allowed to talk about Robin Hood stock it all. Yeah.

Well, is that because of is that a compliance thing or is that just because it's a really bad idea to invest? It's a compliance thing. Oh, you have a gift for you. It is a hat that says oops. Sorry about that because you know, you've been on an apology tour sort of and there have been mistakes and I think anytime you need to you know you could just you could just for your future I don't know like I would call it an apology tour but I do like the hat oops sorry

yeah I really need to get a subscription to lids because god almighty did they get a lot of money for me when I go and make these stupid little fucking hats Yeah, I wasn't sure how big for me. Oh, it's big for you. You'll grow into it. Oh god Just just a couple more hands-on deck event. Okay, well My my my brain will expand right push out my skull. I was gonna say you got a pretty big head on you And I mean because that's I it's okay for me to say that because I have a huge head. I don't know. I mean, you have a big head. It's seven and three quarters, but you look good on it. Thank you. In it. Oops. Sorry about that. Yeah. Oops. Sorry about that. Sorry about that. Yeah. So, uh, we wanted to get into how Robin Hood makes money. And before you even answer, we've got

a TikTok here from our friend Charlie Munger. You know Charlie Munger? I do. Big 10 years. Charlie Munger, who famously looks like a brown paper bag full of wet dog shit. He's just, he looks like what his last name is, Munger. He just looks like a pile of Munger.

I love the commitment to making so much money but getting no work done. Yeah, he's, he's 98 years years old and we've got this TikTok. This is what God damn you looks dead. But this is what he says about you guys. The volume button is currently muted on it. Here we go. Robin Hood trades are not free.

When you pay for order flow, you're probably charging your customers more and pretending to be free. It's a very dishonorable, low grade way to talk. And nobody should believe that Robinhood's trades are free. Okay, so yeah, yeah, that's got to be a frustrating thing, right? Cause I understand the payment for the flow. Yeah, that's it.

Cause that's how you guys make your money, right? Well, in some of these newer companies have been able to do it without order flow, right? Well, like E-Toro does it without, they charge you for withdrawing, they charge you for other things. They make a lot of money. One who does it without order flow too. Right, they do. They tip. Yeah, I think the important thing to sort of mention with this one, and it is one of these very technical topics like settlement. But I think at a high level, one of the things that customers love most about our product,

we talk to customers all the time, they love the order execution quality. Right, it's one of the things we rate most highly on. And we pride ourselves on giving customers a great deal. And it's not just not charging them commissions. It's also the execution quality. We publish our statistics on our website. We can tell you, you know, how you're doing. We have all the effective overquoted and and all of the stats. And I think we do very, very well. And it is something that is very important.

It's important for customers to know about their execution quality. Some customers really care about where their orders are being routed. And we try to give people as much information as possible and give them a great deal. I'm an archa boy myself. An archa boy.

Yeah, I love that rebate, baby. So I guess I mean, we're running out of fucking time We just got the week. I got to ask you. Okay, so I have a few things to wrap up here. First of all How fucking pissed are you at Bayju? Is that his name? Yeah, his hands have been He's so not only is he according to the internet have a little bit more money than you because yeah, but like he just yeah, buddy You you and to that effect, a lot of people hate you and are mad at you and whatnot. Why not just quit?

Just say, okay, fuck it, I'm outta here. And let me pitch you on this because if you were to quit, and I'm not encouraging you to, this is just my idea and I am dead serious. If you were to quit, it would be, it would probably give an immediate boost to the stock. You'd make immediate money. Everybody would make me money. New leadership were putting all the stuff behind us.

Your wife would probably be relieved because I'm sure she doesn't like, you know, destroy the AM calls. Seriously. And like, it could be a, no more all hands on deck, some hands on deck. It could be like Papa John's. Papa John's when Papa John left, and I'm not comparing you to him, but they brought in Shaq.

Everybody loves Shaq. You get Charles Barkley in there, something like that, and baby, you could watch, like own it. You can add a second B to Robin Hood with ROBB. Robin Hood, like you're... Well, that might imply that you're Robin. That's true, I think that's really what they're trying to do. But you were a dominoes.

You're doing great right up until that. Another pizza analogy, dominoes. Like when they added the M when they did double M dominoes. They know they didn't. When Robin Hood Bayer when dominoes said our pizza sucks ass and we're going to change. They're one of the best performing stocks the last decade. Yeah. Have you considered just quit?

You know, you can just quit. Why take the shellac? It's about drive. It's about shut up. Well, it's really about the mission, right? I mean, we have a goal that we think we're in the very early stages of. But could it be carried out without you?

Of getting everyone in the world to be investors. Mm-hmm. And we're only in the US. We have a relatively small set of products, a lot of ambition, a lot of things that we're working on. And I care about that just incredibly deeply. Okay. I had dinner with...

But so what if that goal was easier to achieve without you? Well, I don't know. You had dinner. Who did you have dinner with? I had dinner with, uh, with a friend last night. And he was telling me about how he started using Robinhood, right? And he walked into his bank to talk to a financial advisor. He said, listen, I'm not an expert in these things. I want you to talk to me like, I don't know anything.

And tell me how I should manage my finances. And you know, what happened was he got talked to and lots and lots of people, by the way, have this experience where their financial advisors or their people at their banks make them feel stupid. And he opened up a Robinhood account. And we made it accessible. We made him feel like he could do this. And he became an investor. And I think there's tens of millions of people that we have to reach in the US. Can I stop you for one second? Hundreds of millions outside.

And we're just nowhere close to it. I know you're here to make this pitch, but that's like a very nice anecdotal story. But I'm sorry, there's a ton of other anecdotal stories of people getting way and over the world. I'm sorry, I'm sorry. I know you're here to make this pitch, but and that's like a very nice anecdotal story, but I'm sorry, there's a ton of other anecdotal stories of people getting way and over their head on these things. And it sucks because we're out of time and I would love to talk so much more about, come

back anytime soon. Yeah. And so I would just say it's back to my point. We believe in democracy. So yes, we need more education, we need more tools. But I want to, I want to build a world where everyone has access. Nobody's left behind. And it's not just the rich people that can invest their money and access all these. You sound like a politician a little bit when they're talking about access to healthcare. It's

like, buddy, sure, but like you got to give me the fucking shit so I can go to the doctor. Sure. I mean, I hate the word access for some reason. It's like buddy, you sure, but like you got to give me the fucking shit so I can go to the doctor Sure, I mean, I hate the word access for some reason. It just is triggering. Well, I have one final question. It's a bit more fun famously in the Bible God presented himself To Moses in the form of a burning bush and ingrained at him three wishes If God were to present himself in the form of Jared Leto right here and we're to grant you one wish. Well, because he is the second coming to a lot of people. We've seen him in person. He's beautiful. You are a beautiful guy.

Beautiful guy. Beautiful guy. I mean, his eyes are so deep set. Unreal. Yeah, but if he were to appear here and grant you one wish, what would that wish be? Everyone being an investor. That's it. That's you one wish. What would that wish be? Everyone being an investor. That's it. That's your one wish. Jesus Christ. Funny, that's the wrong answer. We would have accepted peace in the Middle East.

You could have said, for all redistributed wealth, so they don't need to do these. Or how about one million dollars? Cut out the main stuff. What a selfish answer, Vlad. I don't think it's a selfish answer at all. I think actually the more people own the economy

and the world around them, the better and more stable the world will be. That's a very socialist point of view. Vlad is a socialist. He thinks the average voter is stupid and he colluded with Joe Biden and Ken Griffin to fuck you over. You heard it here, man. You heard it here. You heard it here. I guess that's it.

Well, yeah, they're gonna kick our ass. This is really, this is hard. I mean, how do you think we did? Would you, how would you rate us? If this were, yeah, give us 10 stars. I think you guys have a really good chemistry about you. Yeah, there's a lot of unexpected things. I mean hard for me to to think about what to change I don't know you guys know. It's the most important thing is

That you have good chemistry, so I would just double down on that Thank you, and don't forget don't leave too quick you said you were gonna take that selfie with me So I could send to my ex girlfriend, okay, and also We do want to ask people to comment and like and subscribe and shit. And our slogan here, on the show. Oh yeah, you need to give the trillionaire slogan. And this is a hundred, we're not fucking with you here.

It is, kill your parents, quit your job, shoot your pants. So if you could just, I can't say kill your parents. You literally just did. Okay, we'll do kill your parents and then you can come in with, shoot your, kill your parents. You literally just did. Okay, we'll do kill your parents and then you can come in with shit. Kill your parents. Quit your job. Can you say shit your pants? I'm not going to tell people to do these things.

Nice try. Okay. We really do want to have you on. That's not a joke. We don't have to have you on again. So many more questions for you. Have it a bit more structured. We really do want to have you on. That's not a joke. We don't have to have you on again. So many more questions for you. I have it a bit more structured. And yeah, I'd really like to talk to you about some of this stuff and I really appreciate you coming on

to talk about. Yeah, it was cool. Thanks guys. And maybe the next time we can get you on with William Presell, maybe you're, maybe you'll, oh my God, that'd be too much chaos. Maybe you'll see him at some kind of reunion or something. Maybe we can get a little $100 kickback too.

Yeah. Okay, so long everybody. Thank you. Thank you. Thanks, guys.