Robinhood rockets to a $5.6B valuation with a massive new funding round
techcrunch.com
techcrunch.com
A legal gambling app is definitely hugely valuable.
I truly mean to say this in the most positive angle possible. I think they are providing a valuable service and a great app, but it is a very nice business as well due to the above.
Kudos to the team.
Besides, they have day-trading limits built into the app. It’s really just a mobile-first brokerage with extremely low net fees. And I’m grateful for it.
Anecdotally, it definitely feels like it has broadened the base of the retail investor audience (which I think is a great thing) and if you have seen the options and crypto currency UIs it strikes similarities with fantasy football and makes those objects shinier.
However, IB is decidedly not meant for the young, millennial, small amount of investment principal, getting started with investing/trading segment that Robinhood has carved out for itself.
So Robinhood's angle isn't just mobile first, it's mobile first for the segment of the population that expects such a product experience, who are going to grow their portfolios and trading activity in the coming decades.
Etrade made 614 million in profit in 2017. 19% of revenue was from order commissions, or roughly 449 million. So Etrade could eliminate commissions and still remain profitable. https://en.wikipedia.org/wiki/E-Trade
UX. Try out a few other brokerage experiences, and then try Robinhood, and you’ll see that the market was ripe for the taking for a team with design sensibilities.
Their advantage is an ineffable quality.
The closest I can come to describing that feeling of using the service is it's like someone in your family made it for you.
This may sound strange, but there's a lot of love there. That level of attention to detail and quality is rare and apple-like.