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Robinhood nick pangori
- 1. Nick Pangori
- 2. Product Technology-driven brokerage Mobile App Investing at the Push of a Button
- 3. Financial Information (Very) Private Company $66 million raised Zero Physical Infrastructure
- 4. A Short History Vladimir Tenev and Baiju Bhatt
- 5. Secret Sauce Commission-Free Trades $0 Minimum Capitalize on Micro-Investor Pool
- 6. Competition Discount Online Brokerages Full Service Brokers
- 7. Prediction Microinvestors Active Traders Long Term Investors
Hinweis der Redaktion
- Many of the company presentations given in this class have dealt with larger, already established companies. I want to give you guys a look into a smaller, privately-held company, who haven’t entirely crossed the chasm quite yet. I think it is a interesting viewpoint to consider in the midst of these large corporations. I present Robinhood, a stock trading app that I toyed around with a great deal last year. Disclaimer: I have absolutely no affiliation with the company.
- Three Features: 1 )Fast Execution – low-latency system, the Robinhood system is not going to lose you 5 cents in “slippage” 2) Real Time Market Data – a truly live feed. Some brokerages delay price data by 20 minutes and make you pay as an additional feature. 3) Maximum Account Protection - Full encryption, “state of the art” security measures, Member of Financial Industry Regulatory Authority (FINRA) --- protected of up to 500,000
- This is an extremely private company with no apparent physical locations available. While researching the company I stumbled upon an address which according to Google Street View is just a house in residential Palo Alto. They don’t even have a PR team. After some sleuthing online, they are currently hiring for twelve separate and varied positions, stationed in Palo Alto as well as Australia and the UK. It seems like business is booming. They have zero physical infrastructure and seemingly have no costs. Robinhood has been funded by NEA, Index Ventures, Andreessen Horowitz, Google Ventures, Snoop Dogg, and Linkin Park to the tune of $66 million dollars. Management says that this has allowed them to focus solely on UI instead of short-term profit. They earn money by accruing interest from customers’ uninvested cash balances
- TWO So these brokers preferred way of making money is to take commission on a trade. They’d say, yeah I’ll execute the trade for you, but it’ll cost you a fraction of your requested amount. Robin Hood is totally commission free and buying twenty shares of AMZN will cost you exactly that, with zero hidden fees. MICROINVESTOR POOL This app is specifically targeted at microinvestors. To start an IRA or a fund at many places, you need a certain threshold of money: a common minimum is $10,000. Without the presence of brokers worrying about trade fees, microinvestors have a place to begin in the market. So they are capturing an area of the market that most don’t get to. Remember that they make their money by accruing interest on accounts. Robinhood is clearly targeting investors with very small starting balances. Usually, brokerages pay interest on uninvested balances, but this is how they make money.
- Discount online brokerage is one that charges significantly lower fees than full service brokerages, which typically offer financial advice, provide service, ad charge 1-2% on assets under management. There are three subclasses of market participant that I would like to acknowledge: Microinvestor (under 10k, mainly just playing around, retirement not in mind) Active Day Trader Type Long-term Investor Robinhood is clearly trying to capture the first subclass (microinvestor)
- Sense of security is great, but a more recognizable name is still desired in banking.