Speaker 1: Robin was a very controversial name, and I think that's
Speaker 1: what made it powerful, because you either love it or
Speaker 1: you're kind of like repulsed by it to some degree.
Speaker 1: But it doesn't sound like a finance company. The name
Speaker 1: itself tells you a lot about what the company stands
Speaker 1: for and what the products help you achieve. The number
Speaker 1: one health and Well.
Speaker 2: In the podcast, Jay Sendi, Jay Shendy, Jez Only, j Sheet, Hey, everyone,
Speaker 2: welcome back to On Purpose, the place you come to listen,
Speaker 2: learn and grow about how you can become happier, healthier,
Speaker 2: and more healed. We talk about everything from personal growth
Speaker 2: to finance, relationships to business and today's guest is someone
Speaker 2: who's built something truly culturally phenomenon. And I think a
Speaker 2: lot of you may be using the product already, a
Speaker 2: lot of you definitely have heard about it, and a
Speaker 2: lot of you may have a lot of questions like
Speaker 2: I do, and so I'm so excited to have on
Speaker 2: on Purpose. Vlad Tenev the CEO and co founder of Robinhood.
Speaker 2: Vlad is a FIR generation immigrant from Bulgaria. In twenty thirteen,
Speaker 2: Vlad co founded Robinhood and pioneered commission free investing with
Speaker 2: an intuitive mobile first interface, and today Robinhood has more
Speaker 2: than twenty three million funded customers and over one hundred
Speaker 2: and nineteen billion assets under custody. Please welcome to on
Speaker 2: Purpose Flood kind of Flood. It's great to have you here.
Speaker 1: Thanks for having me Jay.
Speaker 2: Yeah, really really fascinating journey you've been on personal and professional,
Speaker 2: and I think our audience and community are going to
Speaker 2: get a lot of value to understand more about the
Speaker 2: investing world from you. But I wanted to start off
Speaker 2: with a question because your pre founder life is actually
Speaker 2: fascinating in terms of how you even got involved, and
Speaker 2: I wanted to ask you, what's a childhood memory that
Speaker 2: you have that you feel has impacted the work you
Speaker 2: do today.
Speaker 1: If I think about the childhood memories that I have
Speaker 1: that stick out, they're all kind of like somewhat from
Speaker 1: I would say, but I think I had a very
Speaker 1: happy childhood by and large, like I wouldn't trade anything,
Speaker 1: but my childhood was full of significant change. So a
Speaker 1: couple of the memories that stick out was going to
Speaker 1: the airport for the first time. You know, I grew
Speaker 1: up in Bulgaria, very small country in eastern Europe. I
Speaker 1: was born in the eighties, which was a time of communism,
Speaker 1: so it was sort of like there was the West
Speaker 1: and then the Iron Curtain and not a lot of
Speaker 1: back and forth travel. My first time to the airport
Speaker 1: was actually after the Berlin Wall fell. Communism in Bulgaria
Speaker 1: had kind of collapsed, or was on the verge of collapsing.
Speaker 1: My father was given an opportunity to go to the
Speaker 1: US to study, which was you know, the events that
Speaker 1: kind of conspired to allow that to happen could not
Speaker 1: have conspired an earlier time, right, But you know, he
Speaker 1: had to go by himself because we just didn't have
Speaker 1: the money to like send even my mom with him,
Speaker 1: much less my mom and me, So he kind of
Speaker 1: went off by himself to see if he could make
Speaker 1: it and make a new life for us and kind
Speaker 1: of this new land. And I think I they were
Speaker 1: trying to prepare me for this because I was an
Speaker 1: only child, and you know, the weeks leading up to it,
Speaker 1: and my parents were like, you know, your dad's going
Speaker 1: to America. You're not going to see him for a
Speaker 1: long time, you know, And it ended up being I
Speaker 1: think about two years before before I saw him again.
Speaker 1: I'm not a very emotional person. I've kind of been
Speaker 1: described as stoic. I wasn't a very emotional child, and
Speaker 1: I just remember like when we got to the gate
Speaker 1: and I and my dad kind of like went to
Speaker 1: the other side. I didn't I wasn't like allowed to
Speaker 1: cross because of course I didn't have a ticket. I
Speaker 1: just like cried and baled my guts out because it
Speaker 1: kind of sank in that I wasn't going to see
Speaker 1: him for a very long time. That's probably one of
Speaker 1: the one of the biggest memories. Another memory, you know,
Speaker 1: perhaps a little bit more relevant to robinhood, was after
Speaker 1: I had moved from Bulgaria to the US and we
Speaker 1: had gotten enough money to have a vacation, and of
Speaker 1: course the only place to go back on vacation was
Speaker 1: to see my grandparents back in the home country. So
Speaker 1: we'd gone back, and I remember the exchange rate of
Speaker 1: the currency, right, It used to be sort of like
Speaker 1: two Bulgarian leva for one dollar. But I came back
Speaker 1: and it was two thousand. So Bulgaria had gone through
Speaker 1: this incredible period of hyperinflation where the inflation of the
Speaker 1: Bulgarian lev was the highest in the world. This was
Speaker 1: nineteen ninety six, and I think nineteen ninety seven as well.
Speaker 1: I think there were two years and so, you know,
Speaker 1: my grandparents' pensions were just worthless. Everyone in the country
Speaker 1: was struggling, and I think those early moments were when
Speaker 1: I developed this like visceral understanding of how important money was,
Speaker 1: because I think to a kid, money's maybe not so important,
Speaker 1: but to me, you know, my parents were new in
Speaker 1: the country. They were just like getting started from scratch,
Speaker 1: basically starting from zero, and I always felt like every decision,
Speaker 1: every family decision, had this like layer of like how
Speaker 1: much money is going to be spent on this, how
Speaker 1: important is it we have to like choose like the
Speaker 1: the budget potato chips, or shop at Shopper's food warehouse
Speaker 1: rather than Safe Way because they have like the dented
Speaker 1: cans and stuff like that. So I think from very
Speaker 1: early on, I got this understanding of like the importance
Speaker 1: of money and saving it and protecting it, and that
Speaker 1: that was just like driving so many of the decisions
Speaker 1: that my parents were making on a daily basis.
Speaker 2: Yeah, thanks for sharing both of those, Actually, they're such
Speaker 2: unique perspectives. With the first one, what was it like
Speaker 2: when you reunited with your dad after two years and
Speaker 2: you saw him, you're absolutely in tears.
Speaker 1: I remember that very vividly too. Actually, yeah, because I
Speaker 1: landed in JFK Airport. I was five years old and
Speaker 1: it was my first airplane flight, and I remember I
Speaker 1: was just like puking my guts out that entire flight
Speaker 1: because you know, they had some they were serving some
Speaker 1: food on the plane, and I was traveling with my aunt,
Speaker 1: who was like fifteen years old at the time, and
Speaker 1: she was like a punk rock teenager, like she loved
Speaker 1: American music. She had her Walkman on. She liked you know,
Speaker 1: Nirvana and grunge. She later settled in Seattle, which which
Speaker 1: I think made a lot of sense. But anyway, they
Speaker 1: brought us the food in the plane, and you know,
Speaker 1: it's funny. You think plain food was like just this
Speaker 1: trash you don't want to eat it, but I thought
Speaker 1: it was It looked amazing, So I just kind of
Speaker 1: like engulfed all of it, and then of course that
Speaker 1: led to uh me puking my guts out, and so
Speaker 1: I didn't have a very fun plane ride. So I
Speaker 1: felt a little off coming coming out on JFK, and
Speaker 1: I hadn't seen my parents in a long time. It
Speaker 1: was like I spent the majority of the past year
Speaker 1: living with my grandparents. My dad first went and my
Speaker 1: mom joined him later, and then I joined with my aunt,
Speaker 1: and so I was very shy. It was it was
Speaker 1: almost like meeting strangers, you know. Of course I knew
Speaker 1: they were my parents, but after not having seen them
Speaker 1: for a while, I was like kind of hiding behind
Speaker 1: my aunt's leg and it would stick one eye out
Speaker 1: get a look at them. And there's this picture of
Speaker 1: me in the parking lot of JFK Airport when they
Speaker 1: kind of like showed me the family car for the
Speaker 1: first time, and it was this like Plymouth Duster from
Speaker 1: the eighties. I don't know if you know the car,
Speaker 1: but it had a mask. So back in the eighties
Speaker 1: cars would have masks out front, and that was kind
Speaker 1: of the style. And I could tell you could tell
Speaker 1: by looking at me that I was like this shy kid,
Speaker 1: very very nervous, didn't really know what was going on,
Speaker 1: you know, landed in a new place, skyscrapers everywhere, you know,
Speaker 1: there was just I remember the skyscrapers, you know, just
Speaker 1: nothing prepares you for that when you're coming from a
Speaker 1: very very small country it took me a little bit
Speaker 1: of time to like get reacquainted with my parents. You
Speaker 1: would think I would just like jump into their arms
Speaker 1: and it would be like we we didn't miss a moment,
Speaker 1: But there there was definitely a little bit of hesitancy
Speaker 1: and shyness before I kind of warmed up and realized
Speaker 1: who they were.
Speaker 2: Yeah, I mean it makes sense because you had separate
Speaker 2: so young that it's almost like you maybe haven't even
Speaker 2: had an opportunity to even build a relationship at that age. Yeah.
Speaker 1: I mean when my dad left, I must have been three.
Speaker 2: Years, That's what I mean. It's yeah, I can't even
Speaker 2: remember being three.
Speaker 1: Yeah, I mean I have very few memories from before then.
Speaker 1: Who was basically saying bye to my dad at the airport.
Speaker 1: Maybe my third birthday party. I vaguely remember through pictures.
Speaker 1: Maybe yeah, the first snowfall. But yeah, it's like three
Speaker 1: or four memories and that's basically it.
Speaker 2: Yeah. And with the second short story you shared about
Speaker 2: the financial situation and seeing the inflation in Bulgaria and
Speaker 2: coming back to that world you when you went back,
Speaker 2: how did someone like that, how did a kid like
Speaker 2: you shy separate from parents seeing that in Bulgaria get
Speaker 2: to Stanford, Like, what does that journey look like? Because
Speaker 2: I can imagine that that was an a simple or
Speaker 2: easy journey. That doesn't seem like a natural, natural progression.
Speaker 1: So when I got to the US, I didn't know
Speaker 1: how to speak English.
Speaker 2: That's what I was going to ask. That was it
Speaker 2: your first language? Right?
Speaker 1: Yeah? And Bulgarian was my first language. I think it
Speaker 1: kind of became clear, you know, once my dad went
Speaker 1: to the US. Then my mom tried to teach me English.
Speaker 1: But you know, it doesn't really work unless you're kind
Speaker 1: of talking to kids and doing it on a daily basis.
Speaker 1: And I was three anyway, so it would have been
Speaker 1: tough going. So when I first got to the US,
Speaker 1: and I went to school in Bulgaria, and I never
Speaker 1: really like found a good group of friends in school either.
Speaker 1: I was kind of a lonely kid. I mean it
Speaker 1: was preschool in kindergarten, so I don't have too many
Speaker 1: memories of it. But I would always switch schools too.
Speaker 1: Like I moved in with my grandparents, they obviously lived
Speaker 1: in a different part of town, so I would go
Speaker 1: in a different school. So I never really liked I
Speaker 1: didn't like the idea of school, and I remember kind
Speaker 1: of dreading having to go in this new country, and
Speaker 1: even more so I didn't speak the language. I remember
Speaker 1: just like kindergarten was was really hard. They were all
Speaker 1: all kinds of different types of kids. I couldn't really
Speaker 1: like navigate my way around. I didn't know who was who.
Speaker 1: I couldn't even tell the teacher that I needed to
Speaker 1: go to the bathroom. So it kind of hold it
Speaker 1: in all day. And then I remember first grade. I
Speaker 1: have this like one memory from first grade, which was
Speaker 1: I was in a little reading circle and you know,
Speaker 1: you know, like the kids do these reading circles and
Speaker 1: you're reading like these basic books. And I still remember
Speaker 1: this first grade reading circle and I was like, man,
Speaker 1: I can read, And not only can I read, but
Speaker 1: I'm reading better than all these American kids. So I
Speaker 1: think that's when I kind of had the realization that
Speaker 1: maybe I was like intelligent or I identified as a
Speaker 1: smart person. And I think my parents did this like
Speaker 1: really valuable thing in hindsight, which was they kind of
Speaker 1: like advocated for me. So they never got into like
Speaker 1: the PTA or school activities or volunteering. They just didn't
Speaker 1: have time because my dad was in grad school and working.
Speaker 1: My mom was working as well, just to try to supplement,
Speaker 1: and they're like, you know, our kid is smart. He
Speaker 1: should be in the accelerated like math. Can he skip grades?
Speaker 1: They were always trying to like push the teachers to
Speaker 1: put me in another grade, and the teachers were like, well, well,
Speaker 1: he's small and he doesn't really have that many friends.
Speaker 1: We don't really think it's a great idea for to
Speaker 1: have him skip a whole bunch of grades. But you know,
Speaker 1: they kept pushing, and eventually, you know, I was given
Speaker 1: an opportunity to skip a grade. And I did like
Speaker 1: very very well at school. But I kind of had
Speaker 1: this fairly early realization that I was smart and kind
Speaker 1: of good at math and sciences. And then my parents
Speaker 1: also had this way of like applying pressure, which I
Speaker 1: think was like kind of honest from their perspective, but
Speaker 1: also might have been a little bit strategic, which was
Speaker 1: we're new to this country. We're immigrants, like we're not citizens.
Speaker 1: We could sort of like get kicked out at any time.
Speaker 1: There was this like fear of deportation always, and so
Speaker 1: it was kind of like you got to do well
Speaker 1: in school because otherwise we might get deported, and for
Speaker 1: sure you're gonna have to get a scholarship because we're
Speaker 1: not making any money in this family, so you're gonna
Speaker 1: have to, like if you want to go to college
Speaker 1: and make it in this country and get education, it's
Speaker 1: kind of on you. I would kind of hear this
Speaker 1: and really internalize it at an early age, but it
Speaker 1: was quite intense. I was like, all right, well, I
Speaker 1: better just like always a saw my exams and do
Speaker 1: well because there was like all this pressure of the
Speaker 1: family making it in this country that I felt a
Speaker 1: big part. Yeah, that I felt a big part of.
Speaker 2: Did it ever feel like too much or it felt
Speaker 2: like it just got you to perform and you locked in,
Speaker 2: Like did you find pressure to be your friend or
Speaker 2: did you find pressure overwhelming? Yeah?
Speaker 1: I don't think that it ever felt like too much.
Speaker 1: I think school felt School, at least kind of in
Speaker 1: the early days, was relatively easy for me. Yeah, I
Speaker 1: mean I kind of like sailed through elementary school. By
Speaker 1: the time I got to middle school, I was probably
Speaker 1: like four years ahead of my classmates, three or four
Speaker 1: years ahead in mathematics, for example. My dad always emphasized
Speaker 1: mathematics too, you know, he was he was an economist
Speaker 1: in Bulgaria, and he was always like, well, you know,
Speaker 1: if you're good at math, you can kind of do anything.
Speaker 1: So all this other stuff, like you know, language, arts,
Speaker 1: you know, you'll you'll figure that out. Math is like
Speaker 1: the thing. And there was also a little bit of
Speaker 1: a competitive element because I would be like, oh, Dad,
Speaker 1: you know, how old were you when you figured out
Speaker 1: like this type of math, Like when did you learn calculus?
Speaker 1: And he was like, oh, I learned calculus when I
Speaker 1: was in graduate school. I was like, all right, I'm
Speaker 1: gonna do it in seventh grade. No, maybe it was
Speaker 1: like eleventh grade or something pre calculus maybe. Then I
Speaker 1: you know, started doing it outside of school. I started
Speaker 1: doing all of these camps, like there was this one.
Speaker 1: There was this one camp called CTY. I don't know
Speaker 1: if you've heard of it. I did that in middle school.
Speaker 1: And basically the way it worked was you take the SAT.
Speaker 1: So the SAT is the for any listener who was
Speaker 1: not an American college entrance exam here. I think it's
Speaker 1: required again now for a while it wasn't required, but
Speaker 1: basically you have to take it to get into a
Speaker 1: good college. And for this camp ct Y, you basically
Speaker 1: took it as a middle schooler, and then you know,
Speaker 1: depending on how well you did on this test, you
Speaker 1: could like qualify for certain classes. In eighth grade, I
Speaker 1: got a pretty good score. I think I got a
Speaker 1: thirteen seventy and I'd skipped a grade, so I was
Speaker 1: like a younger eighth grade or two. And at that point,
Speaker 1: you know, I had this math teacher in my middle
Speaker 1: school and he had to like sign some stuff to
Speaker 1: have me go to this camp. He's like seven seventy
Speaker 1: on the on the math and the SAT like that's
Speaker 1: higher than I ever got, you know, when I was
Speaker 1: in college. So I think at that point, I just
Speaker 1: I kept getting this reinforcement that you know, I was
Speaker 1: really great at math. I should I should keep doing it.
Speaker 1: And I guess Stanford. How I came to Stanford was
Speaker 1: an interesting story. The second vacation that my family took
Speaker 1: after we moved to America, they took me to California
Speaker 1: and my dad was like reading all these travel books
Speaker 1: and he had this book like the thousand and one
Speaker 1: Places to See Before you Die, and a lot of
Speaker 1: them were on the West Coast, so like the Grand
Speaker 1: Canyon and Sequoia National Park, where you could drive your
Speaker 1: car through this like big tree. I don't know if
Speaker 1: you've seen pictures of that. We drove through the tree,
Speaker 1: and we kind of did this road trip through California,
Speaker 1: and there was this one day where we drove through
Speaker 1: San Francisco and we spent the night there and it
Speaker 1: was the middle of summer and it was raining. It
Speaker 1: was like close to zero degree celsius. So I had
Speaker 1: to actually buy a jacket because I was just unprepared
Speaker 1: for this. So kind of kind of this miserable day,
Speaker 1: and then we drove down. We drove down to Stanford,
Speaker 1: which was in Palo Alto, about forty five minutes south
Speaker 1: of the city, and everything cleared up. The sky was blue,
Speaker 1: not a single cloud in the sky. It was sunny.
Speaker 1: They were like I think summer school was in session,
Speaker 1: so kids were like throwing frisbee at the oval and
Speaker 1: they were like kids picnicking in the main quad, and
Speaker 1: I just remember it felt so idyllic, particularly juxtaposed against
Speaker 1: how horrible San Francisco was that day that I was like,
Speaker 1: this is where I want to go, Like my parents
Speaker 1: have been spending all this time talking about college. This
Speaker 1: seems like a fantastic college. So back then I wanted
Speaker 1: to be a lawyer. So there's this photo of me
Speaker 1: on that road trip in front of the law school
Speaker 1: at Stanford, and I'm like, yeah, this is where I'm
Speaker 1: gonna I'm gonna go and be a lawyer. I had
Speaker 1: seen a few good men, you know, the Tom Cruise movie.
Speaker 1: I thought being a lawyer was so cool because you
Speaker 1: get to like really get the people, like these intense arguments.
Speaker 1: I think I always remembered that even when I applied
Speaker 1: for college. I applied early to Stanford as a result,
Speaker 1: but the lawyer thing I kind of grew out of.
Speaker 2: Let's take a short break to hear from our sponsors.
Speaker 2: All right, thank you to our sponsors. Now let's dive
Speaker 2: back in. Was robin Hood the story ever a part
Speaker 2: of your early life or was that just a name
Speaker 2: that stuck out as a name in and of itself? Yeah?
Speaker 2: Did you ask the cartoon when you grew up? Or
Speaker 2: did you read the book? I did?
Speaker 1: Yeah, No, I watched the cartoon. I was a big
Speaker 1: fan of that. And of course Men in Tights was
Speaker 1: another great one. The origin of Robinhood the name was
Speaker 1: you know, the finance industry had a bad rap in
Speaker 1: the early part of the last decade. Still does, really
Speaker 1: still does. So you know, my girlfriend Selena my wife now,
Speaker 1: but my girlfriend at the time, she was kind of
Speaker 1: like she started dating me. I was this entrepreneur, I
Speaker 1: had this idea, and she had to kind of explain
Speaker 1: to her friends what I was doing. And she was
Speaker 1: like a doctor and medical researcher at the time, so
Speaker 1: that's a very concrete thing. You know, her friends were
Speaker 1: mostly researchers and doctors. So she was like, well, Vlad,
Speaker 1: you know, he's in finance. But then there'd be like
Speaker 1: this groan, like, oh, you know, they thought I was
Speaker 1: some kind of investment banker or something. She's like, no, no, no,
Speaker 1: but not that kind of finance. They're like the Robinhood
Speaker 1: of finance. They're trying to help the little guy, giving
Speaker 1: them tools to invest and manage their money. And so
Speaker 1: when we were kind of coming up with the name,
Speaker 1: that was a name that that we got excited by.
Speaker 1: And there were a couple of other names too, Like
Speaker 1: we thought about naming the company Omaha actually, and we
Speaker 1: got pretty close to that one. And in hindsight, you know,
Speaker 1: Warren Buffett and Charlie Munger were never big fans of Robinhood.
Speaker 1: They were kind of like crapping on us from time
Speaker 1: to time publicly. So sometimes I think if we had
Speaker 1: named the company Omaha, maybe we wouldn't have had that element.
Speaker 1: I'd also never been to Omaha, so that kind of
Speaker 1: like that sealed it for me. So Robin was a
Speaker 1: very controversial name, and I think that's what made it powerful,
Speaker 1: because you either love it or you're kind of like
Speaker 1: repulsed by it to some degree. But it's not boring.
Speaker 2: It doesn't sound like a normal finance company.
Speaker 1: It doesn't sound like a finance company. And I think
Speaker 1: in hindsight that was a really good thing because it's
Speaker 1: just memorable and it's like emotionally gripping, and the name
Speaker 1: itself kind of tells you a lot about what the
Speaker 1: company stands for and what the products should like help
Speaker 1: you achieve.
Speaker 2: Yeah, how old were you when you first died in that?
Speaker 1: Yeah, you know, it ties into what we were talking
Speaker 1: about earlier. I was at home during the summer because
Speaker 1: you know, my parents were working, and I spent a
Speaker 1: lot of time with computers, and one of the early
Speaker 1: things I discovered was like building a portfolio on Yahoo
Speaker 1: Finance actually, and this was nineteen ninety seven, late nineties. Wow,
Speaker 1: So during the dot com boom, when somehow, I don't
Speaker 1: even know how I came across this, but I was
Speaker 1: building a portfolio of companies that I recognized, like Yahoo
Speaker 1: three Com, which made the Palm Pilot one of the
Speaker 1: first consumer PDAs at the time PDAs. I'm like, yeah, yeah, yeah,
Speaker 1: I remember, well ahead of their time, right, yeah, very
Speaker 1: I did decently well. In hindsight, everyone was doing well
Speaker 1: on all those stocks for quite a long time because
Speaker 1: it was the dot com bubble. But my parents basically
Speaker 1: saw an opportunity to motivate me to do well on
Speaker 1: the SAT to qualify for this camp that we were
Speaker 1: talking about earlier. So basically they were like, if you
Speaker 1: get above I think it was like thirteen hundred on
Speaker 1: the SAT, we will let you invest with like the
Speaker 1: dollar amount of your score. It was something like that.
Speaker 1: And so you know, I was like very motivated by this.
Speaker 1: And so when I got my thirteen seventy and my
Speaker 1: dad and I kind of he funded an e trade
Speaker 1: account for me and I started investing.
Speaker 2: No way, do you remember your vest investment? Yep?
Speaker 1: Yeah, I bought three Com, the company that made the
Speaker 1: palm Pilot. My feeling was that this device was so interesting,
Speaker 1: and they had started giving them out to my parents,
Speaker 1: who by that point were working at the World Bank,
Speaker 1: and I was like, all right, well, if the World
Speaker 1: Bank is using them, this must be a company that
Speaker 1: you know, is growing and they'll probably be around for
Speaker 1: a while. And plus the device was just super cool.
Speaker 1: You know. Pretty soon after my dad brought it home,
Speaker 1: he didn't know how to use it, so I just
Speaker 1: took it and started playing with it. So and actually
Speaker 1: through that I learned a lot about investing, because what
Speaker 1: happened was there was a spinoff. So first that started
Speaker 1: at as three Com, but then this palm Pilot business
Speaker 1: was growing and they spun it off, so then I
Speaker 1: had two stocks. And then I started getting the prospectuses
Speaker 1: in the mail and voting documents, and I learned all
Speaker 1: about like shareholder proxy voting and all the stuff that
Speaker 1: a normal twelve year old probably wouldn't wouldn't have occasion
Speaker 1: to learn about. But because I was invested, I actually
Speaker 1: like felt compelled to learn more. So yeah, I think
Speaker 1: that really set me off on a lifetime of learning
Speaker 1: about investing in finance.
Speaker 2: Yeah, how much How did did you make or lose?
Speaker 1: At first? I was I was up quite a bit.
Speaker 1: Then in two thousand, I think my portfolio dropped to
Speaker 1: maybe like twenty thirty percent of what I started with,
Speaker 1: and then I think it probably took another ten years
Speaker 1: beyond that for that portfolio to be in the green again.
Speaker 2: Oh wow.
Speaker 1: But I mean, I would say it's the great thing
Speaker 1: about getting started young in general, not just for me.
Speaker 1: You have plenty of time to actually like make up
Speaker 1: for the mistakes, and you know, compounding over a long
Speaker 1: period of time corrects a lot of mistakes. So I think,
Speaker 1: generally speaking, the earlier you can get started the investing,
Speaker 1: the better.
Speaker 2: Yeah, it's fascinating hearing about your own investing journey and
Speaker 2: starting at twelve is is pretty young. I mean, that's
Speaker 2: pretty impressive that you were able to compute and factor
Speaker 2: that in. Have you ever taken an IQ test? Like,
Speaker 2: do you know your argue? I have not. Yeah. Yeah,
Speaker 2: I'm just say I was intrigued. Yeah, it just based
Speaker 2: on everything you've been saying. I'm just like, it's rare
Speaker 2: that I've met someone who's felt that they've always excelled
Speaker 2: since an early age, like that's not as common an
Speaker 2: experience anymore. Yeah, I don't know if you meet people
Speaker 2: like that.
Speaker 1: I mean, I do think that Stanford in particular is
Speaker 1: kind of an interesting amalgamation of people. So you have
Speaker 1: a lot of people from like diverse, modest backgrounds that
Speaker 1: come to Stanford, and usually those people have like excelled academically,
Speaker 1: which is pretty amazing. And then you also have people
Speaker 1: that come from like wealthy families from all over the world.
Speaker 2: Yeah.
Speaker 1: I think some people consider that to be not ideal,
Speaker 1: like maybe it should all be merit based and everything,
Speaker 1: but I think it actually has worked fairly well because
Speaker 1: what happens is the folks from modest means that have
Speaker 1: like really high horsepower get to make connections, and you
Speaker 1: make connections with all of these people and it kind
Speaker 1: of unlocks business opportunities for you. So, you know, a
Speaker 1: lot of the folks that I met in my undergrad
Speaker 1: and the different types of people, I think at the
Speaker 1: time I kind of didn't recognize this, but they ended
Speaker 1: up helping me in my business career, either because they
Speaker 1: became journalists that like helped tell the story of Robinhood,
Speaker 1: or they joined venture capital firms and they became indirectly
Speaker 1: or directly investors in Robinhood, or they advised us with
Speaker 1: certain things. I think everyone is so diffuse in general
Speaker 1: because people grow up in different places. But like, college
Speaker 1: is one of those moments that people get brought together,
Speaker 1: and you do in a place like Stanford in particular,
Speaker 1: get to encounter a lot of a lot of really
Speaker 1: special people. And you know, when I came to Stanford,
Speaker 1: I actually had no conception of going into business, you
Speaker 1: know that I kind of stumbled into that later. By
Speaker 1: the time I got to college, I was interested in
Speaker 1: theoretical physics. That was like my passion because I was
Speaker 1: consumed by this question of, like why are the laws
Speaker 1: of the universe the way they are? I had read
Speaker 1: about relativity when I was in high school, and I
Speaker 1: was just like the first time I read like the
Speaker 1: you know, Einstein's Book of Special Relativity, it just blew
Speaker 1: my mind. And I had to read it like six
Speaker 1: or seven times to figure out what was going on,
Speaker 1: you know, and then I you know, you try to
Speaker 1: understand more and deeper. And the question that really motivated
Speaker 1: me was like why do the laws of gravity look
Speaker 1: like this, but like all the sub atomic particles like
Speaker 1: all the laws around article physics look different, and is
Speaker 1: there one theory that is basic that unifies both of them.
Speaker 1: This sort of like unification of quantum gravity was this
Speaker 1: topic that really interested me. So I came to Stanford
Speaker 1: to study that, and that's kind of what what pushed
Speaker 1: me into into eventually doing math and going to UCLA
Speaker 1: to study math with a professor named Terry Tao. But like,
Speaker 1: if you think about that group of people, the folks
Speaker 1: at Stanford who come to study theoretical physics, and you
Speaker 1: don't do that because there's very little money in it,
Speaker 1: particularly back then, right, this was like pre data science
Speaker 1: and applied machine learning. So yeah, Actually, by by the
Speaker 1: time I got to that point, I was looking around
Speaker 1: and I'm like, wow, I'm the dumbest person here. These
Speaker 1: are just I'm surrounded by like some of the smartest
Speaker 1: people I've ever met.
Speaker 2: Well, and how did you get distracted from that?
Speaker 1: I was here at UCLA studying math, and two things happened.
Speaker 1: The number one thing was when I decided to go
Speaker 1: to graduate school and kind I think my bubble of
Speaker 1: the academic world kind of burst a little bit because
Speaker 1: I had this romantic notion that you would kind of
Speaker 1: spend all of your time thinking about difficult problems and
Speaker 1: just like being creative. It's almost like being an artist,
Speaker 1: like maybe there's not much money in it, but you
Speaker 1: spend a lot of your time just like practicing your craft. Right.
Speaker 1: But then I was given this book. It was called
Speaker 1: like the Mathematicians Survival Guide, and it was like chapters
Speaker 1: about how to deal with the administration and the bureaucracy
Speaker 1: of the graduate department, how to advocate yourself for yourself
Speaker 1: with the department chair, how to make sure that you
Speaker 1: get like a good research fellowship so you don't have
Speaker 1: to spend all of your time teaching undergraduate classes. And
Speaker 1: I think at that point I was like, oh, man,
Speaker 1: like this is a career and it's not like the
Speaker 1: career that I wanted. Another thing happened at the same time.
Speaker 1: So my first month in grad school was September of
Speaker 1: two thousand and eight, and Lehman Brothers went under that month.
Speaker 1: It was it was the start of the global financial crisis.
Speaker 1: You and I are basically at the same age, I think,
Speaker 1: born in eighty seven. This was kind of like maybe
Speaker 1: for you, for me certainly, like the folks that graduated
Speaker 1: my year of college, some of them went to finance
Speaker 1: and some of them even went to work at Lehman Brothers.
Speaker 1: And it was sort of like one month after they joined,
Speaker 1: you know, there was like photographs of them carrying their
Speaker 1: stuff out of the offices and boxes. Right, So, yeah,
Speaker 1: that was a tough time for a lot of people.
Speaker 1: A lot of my friend's parents lost their jobs that year,
Speaker 1: so it was the global financial crisis. And yes, somewhat oddly,
Speaker 1: my good friend from college, whose name was Beiju Bod
Speaker 1: who I ended up starting Robinwood with, he had gotten
Speaker 1: a job in finance kind of on a whim, and
Speaker 1: he managed to convince me that this time was the
Speaker 1: best time to start a finance company. And of course
Speaker 1: I wasn't like super committed to my PhD path because
Speaker 1: of all the other stuff I mentioned. So I was like,
Speaker 1: you know what, this sounds like an interesting problem. Let's
Speaker 1: see if we can do something here. So we rented
Speaker 1: a little house in South San Francisco in the South
Speaker 1: Mission where we were paying like three hundred dollars a
Speaker 1: month in rent. We're all living together. I had to
Speaker 1: take care of this lady's cats, which was why the
Speaker 1: rent was so cheap. That was kind of my first
Speaker 1: experience with entrepreneurship. What attracted me to it was kind
Speaker 1: of the same thing that attracted me about math and physics.
Speaker 1: It was the act of creating something with you didn't
Speaker 1: really have to listen to anyone telling you what to do.
Speaker 1: You could use your entire mental faculties and your creativity
Speaker 1: to like determine your own success and your outcomes. You know,
Speaker 1: just like a couple of people who were really passionate
Speaker 1: and committed could build something and you know, actually use
Speaker 1: it as a vehicle to sustain themselves economically. So that
Speaker 1: idea when I kind of discovered it, and I never
Speaker 1: really like thought of myself as an entrepreneur before. I mean,
Speaker 1: it wasn't really something that was common in the East Coast,
Speaker 1: to be honest, or in Bulgaria. I mean you had
Speaker 1: some but not technology entrepreneurship really. And then when and
Speaker 1: I kind of started doing it and I started like
Speaker 1: programming and writing code, then I just like found the
Speaker 1: whole thing really intoxicating. So even though we didn't have
Speaker 1: success it basically our first idea failed within a year,
Speaker 1: I just kind of knew that that I wanted to
Speaker 1: do it. So that that gave me the confidence to
Speaker 1: drop out of UCLA start something a little bit different,
Speaker 1: and it was it was the third idea that we
Speaker 1: had that led to Robinhood, and that was kind of
Speaker 1: the one that really worked. I think that the actual
Speaker 1: experience and the mindset of an entrepreneur just like resonated
Speaker 1: with me very very deeply, and I was having so
Speaker 1: much fun, like unlike anything else that I had done,
Speaker 1: that I just knew I had to keep doing it.
Speaker 2: Yeah, I mean, democratizing investing is such a at least
Speaker 2: at the time as well, with such an ambitious goal
Speaker 2: to think about trying to get the average person to
Speaker 2: be able to have access to something that wasn't accessible
Speaker 2: to them just a few years before, especially in a
Speaker 2: place that seemed volatile, you needed a lot of capital
Speaker 2: to get started. I want to do a bit of
Speaker 2: investing basics for people who are listening, who may or
Speaker 2: may not be using your platform already and want to
Speaker 2: understand a bit more about it. If someone's sitting there,
Speaker 2: going and I remember being this person, So I remember
Speaker 2: twenty thirteen, I just left the monastery that I lived
Speaker 2: in for three years, and I'd gone back into the
Speaker 2: world of work, and I had a mentor who told
Speaker 2: me exactly which crypto to invest in in twenty thirteen.
Speaker 1: Which one did he say? Well, at the time he
Speaker 1: was like dogecoin.
Speaker 2: No, no, definitely wasn't. At the time it was like
Speaker 2: ethereum lithium, like oh yeah, like coin yeah yeah. And
Speaker 2: so he was mentioning all these places. And I remember
Speaker 2: in twenty thirteen, with very little capital, very little investment knowledge.
Speaker 1: See now, if someone said my mentor and what did
Speaker 1: you call him?
Speaker 2: Your yeah, mentor yeah, yeah, mentor. Yeah.
Speaker 1: If now someone's like, oh, my guru told me the
Speaker 1: which cryptocurrency to invest in, I would be like, hey,
Speaker 1: you should be a little skeptical of this mentor. But
Speaker 1: in twenty thirteen that was actually like.
Speaker 2: I should have listened.
Speaker 1: That was before the space got a little a little corrupted,
Speaker 1: before the pretenders came in.
Speaker 2: Yeah. No, he'd been successful in tech, investing in things
Speaker 2: for years. And yeah, i'd met him. He was I
Speaker 2: was what twenty six at the time, he was fifty five.
Speaker 2: Oh wow, and so he you know, he'd been around.
Speaker 2: He was a very smart, thoughtful, thoughtful person. I didn't
Speaker 2: really understand anything of my investing and I grew up
Speaker 2: in a family where we didn't have a lot. Growing up,
Speaker 2: there wasn't I didn't see my parents invest. I didn't
Speaker 2: see them have that, And so I remember being like,
Speaker 2: he was just like, just put one thousand dollars, put
Speaker 2: one hundred dollars into each of one hundred pounds. I
Speaker 2: was in London, So he goes, just put one thousand
Speaker 2: pounds into one hundred pounds into each and just see
Speaker 2: how it goes. And I remember being so risk averse
Speaker 2: that I didn't even want to put one thousand pounds
Speaker 2: into it. And that's probably all I had at that time.
Speaker 2: I was working a job where I made thirty one
Speaker 2: five hundred pounds a year at Eccentria, and.
Speaker 1: I we're in the UK.
Speaker 2: As in the UK, Yeah, I could have put one
Speaker 2: thousand pounds in and I didn't. If I did, it
Speaker 2: would have been a great investment. But the question I'm
Speaker 2: asking is a lot of people don't invest because they
Speaker 2: don't have enough knowledge, but they also feel they don't
Speaker 2: have enough money. At what point should you feel confident
Speaker 2: and comfortable to start investing what amount? And yeah, let's
Speaker 2: start that.
Speaker 1: Yeah, I mean a lot of Robinhood customers start with
Speaker 1: as little as ten dollars, and I think that was
Speaker 1: actually the innovation that Robinhood unlocked. So before we came
Speaker 1: into the mix, you used to have to pay a
Speaker 1: trading fee, and if you started in the UK, you
Speaker 1: probably paid a trading fee at twenty thirteen as well.
Speaker 1: I mean still do that market hasn't gone zero commission yet.
Speaker 1: Let's say you have to pay ten dollars per trade, Well,
Speaker 1: that's you know, if you make one hundred dollars investment,
Speaker 1: that's ten percent of the of the actual value in
Speaker 1: the investment, and if you want to sell it, you know,
Speaker 1: then that gets to twenty percent for the round trip.
Speaker 1: And so it doesn't really make sense to start with
Speaker 1: one hundred dollars in that sense because you have to
Speaker 1: count on many years of appreciation to just pay for
Speaker 1: your transaction fee. But if you lower the fees to zero,
Speaker 1: you could start with any amount, which is what you
Speaker 1: did exactly, And that was kind of our big that
Speaker 1: was that was sort of one of the three big
Speaker 1: innovations that I think made Robinhood possible and really made
Speaker 1: it take off. It's eliminating the commissions and lowering the
Speaker 1: account minimums to zero because a lot of brokers also
Speaker 1: had account minimums. You couldn't even open account unless you
Speaker 1: had two thousand dollars or sometimes more in there. And
Speaker 1: we said, you know what we really wanted. And the reason,
Speaker 1: by the way that they had these accounts minimums was
Speaker 1: these companies were not automated enough to service small accounts.
Speaker 1: They just lose money on them. And so we said
Speaker 1: to ourselves, well, it would be it would not really
Speaker 1: uphold the mission of a company named Robinhood to have
Speaker 1: an arbitrary account minimum. We should make it zero. We
Speaker 1: should hold ourselves to that standard, and we just should
Speaker 1: like incent ourselves to make the business as efficient as possible,
Speaker 1: because I think that would be the long term correct
Speaker 1: way to build the business. Like, let's point everything towards
Speaker 1: creating a forcing function for us to be more efficient
Speaker 1: and more automated and adopt technology more aggressively and be
Speaker 1: the first to do it relative to the market. And
Speaker 1: a company where everything is pointed towards using technology to
Speaker 1: lower the cost of things, make things as usable as possible,
Speaker 1: and as automated as possible, that seems like a long
Speaker 1: term robust structure for a company. So we kind of
Speaker 1: like that, But yeah, a lot of customers start with
Speaker 1: just ten dollars or even less.
Speaker 2: And what would you say the three biggest mistakes new
Speaker 2: investors make when they don't know what they're doing.
Speaker 1: I think this is a little bit strange, given like
Speaker 1: so much of Robinhood, at least in the public realm
Speaker 1: is you know, meme stocks and meme trading. But I
Speaker 1: think probably the biggest mistake one can make is buying
Speaker 1: something just because someone on the internet like thinks that
Speaker 1: you should buy it and is posting it. I'm personally
Speaker 1: a big believer in thinking for yourself, and like buying
Speaker 1: something because people on social media are saying it's a
Speaker 1: good idea, It's just like kind of anathema to me, Like, sure,
Speaker 1: use it as a signal, but like make your own
Speaker 1: decision and kind of think through it yourself and don't
Speaker 1: just rely on the opinions and commentary of others any others.
Speaker 2: Big mistakes that people may.
Speaker 1: I think just like waiting to get started, you know, now,
Speaker 1: particularly with the tools there's you know, with Robinhood kind
Speaker 1: of entering the market, not just Robinhood, but most of
Speaker 1: the competitors that at least survive in the space. There's
Speaker 1: no maintenance fees, no kind of onboarding fees, keeping money
Speaker 1: in the savings account where in particular now with high rates,
Speaker 1: you know a lot of the banks are offering you
Speaker 1: zero percent, so your money is just losing money sitting
Speaker 1: in savings, not doing the simple things to optimize I
Speaker 1: think our mistakes. And there is so much free content
Speaker 1: out there on the internet, on YouTube, and you know
Speaker 1: that just spending even thirty minutes to get educated and
Speaker 1: actually just like getting started and opening an account and
Speaker 1: creating the habit of investing even if you don't think
Speaker 1: you have much money. The technology is there so that
Speaker 1: you could actually do the exact same things with one
Speaker 1: dollar as you can with thousands of dollars. And you know,
Speaker 1: through another thing, Robinhood pioneered fractional shares. You can invest
Speaker 1: any dollar amount in pretty much any stock. You don't
Speaker 1: need a whole share. So one of the first things
Speaker 1: that we did, which we thought was very cool, was
Speaker 1: you have, for example, companies whose share prices are hundreds
Speaker 1: of thousands of dollars per share, like Berkshire hathaway A
Speaker 1: Shares for example, and you know they would almost pride
Speaker 1: themselves on having this share price that's inaccessible to normal people,
Speaker 1: and not everyone could be invited to this club of
Speaker 1: like shareholders and they have the annual shareholder meeting. But
Speaker 1: you know, Robinhood figured out how to break up these
Speaker 1: stocks into pieces and you can buy a dollar of it,
Speaker 1: and you know, then you had all these retail investors
Speaker 1: showing up at the shareholder meetings, and I think that
Speaker 1: made those guys very angry actually in hindsight. But how
Speaker 1: did you vary?
Speaker 2: How did you even pull that off? How's that even possible?
Speaker 1: Yeah, it was a big technical challenge, Yeah, big technical challenge. Basically,
Speaker 1: what happens is the company has to keep inventory in
Speaker 1: all of these names, and you imagine, like let's say,
Speaker 1: I mean the way that this works is probably a
Speaker 1: little bit more complicated, but to simplify it, let's say
Speaker 1: you want to buy a dollar of Berkshire Hathaway. Well,
Speaker 1: then we would essentially have to keep inventory of a
Speaker 1: whole share and then allocate internally different pieces of it,
Speaker 1: and then you know, when the total sum exceeds one share,
Speaker 1: then we go out and buy another one. So we're
Speaker 1: kind of like managing this portfolio of you know, right
Speaker 1: around one share in every instrument.
Speaker 2: Yeah.
Speaker 1: Yeah, and then we can just do that through technology.
Speaker 1: I mean, we have great engineers and data scientists and
Speaker 1: brokerage experts that can manage the system.
Speaker 2: If you had to say that for a new investor,
Speaker 2: there's certain factors they should understand about a stock before investing.
Speaker 2: What would you say the three key things that they
Speaker 2: should know? An amount of information they should have before
Speaker 2: they go in and put any amount in.
Speaker 1: I guess without giving people two specific investment advice because yeah,
Speaker 1: I'm kind of not really allowed to do that. I'm
Speaker 1: a big proponent in investing in companies that create products
Speaker 1: that you like and use. You know, if you use
Speaker 1: the product, if you think that the company that's making
Speaker 1: those products is improving the products, and if you're bullish
Speaker 1: on continuing to be useful and you think it's trending
Speaker 1: in the right direction. That's been sort of my philosophy.
Speaker 1: It's how I got started to and I think that's
Speaker 1: why if you look at the Robinhood customer base and
Speaker 1: we're now publishing the stocks that our customers are investing in.
Speaker 1: Most we call it the Robinhood Investors Index, it tends
Speaker 1: to be consumer companies that make products. They're sort of
Speaker 1: like heavy in innovation, So for example, in Nvidia, Tesla, Apple,
Speaker 1: these are some of the most commonly invested stocks, and
Speaker 1: it's because our customers are younger, they believe in the future.
Speaker 1: They tend to be early adopters of technology and innovation.
Speaker 1: They believe in artificial intelligence, clean energy, electric vehicles. So yeah,
Speaker 1: those tend to be like both sort of like some
Speaker 1: of the most held instruments and some of the first
Speaker 1: instruments that people kind of buy into. We also have
Speaker 1: a product first trade recommendations, and it's difficult for the
Speaker 1: service to recommend individual stocks, but for someone that actually
Speaker 1: comes in and they say, you know, I just want
Speaker 1: to invest, I don't really know, I don't want to
Speaker 1: pick my own stocks. Over time, we're increasingly getting better
Speaker 1: and better equipped to serve that customer. So now you know,
Speaker 1: you can just answer a couple of questions and we'll
Speaker 1: recommend a diversified portfolio of ETFs, explain to you what
Speaker 1: all the pieces are, and then you'll kind of see
Speaker 1: how it all works mechanically. And I think sometimes just
Speaker 1: like going through the process of making a trade, it's
Speaker 1: much simpler than like reading a book on it I
Speaker 1: like to say that it's like playing a violin. You're
Speaker 1: not going to learn to play a violin really well
Speaker 1: by like reading a book on how to play the violin.
Speaker 1: Maybe if you're already really really good and you're trying
Speaker 1: to get a little bit better understanding the behind, it
Speaker 1: is going to help. But otherwise it's just sort of
Speaker 1: like pick up the thing and start practicing, and you'll
Speaker 1: get better the more you do it. One of the
Speaker 1: things I became interested in when I was an undergrad
Speaker 1: is options trading. A lot of my students my year
Speaker 1: were applying to be options traders. That was like a
Speaker 1: before went fully electronic. That was a job that people had,
Speaker 1: right And there was this book like Options, Futures and Derivatives.
Speaker 1: It was called something like that by Hull, and it
Speaker 1: was like this thick dictionary explaining how all these option
Speaker 1: strategies work. And I just kind of imagine, you know,
Speaker 1: if someone had to understand that book before kind of
Speaker 1: like going into options trading or discovering it for the
Speaker 1: first time, I think that would be just like an
Speaker 1: incomprehensible barrier. But like, you build up some intuition for
Speaker 1: these things by doing it, and it sort of like
Speaker 1: makes you more motivated to read the literature, and it
Speaker 1: also sort of like gives you more real world knowledge
Speaker 1: than you could ever get from just reading. So I
Speaker 1: think just like getting started and doing it is the
Speaker 1: most important things. It's a skill like playing a sport
Speaker 1: or playing a music instrument, more than just like an
Speaker 1: academic pursuit.
Speaker 2: Yeah, how many of you uses do you find going
Speaker 2: beyond just that first trade? Do you have a percentage
Speaker 2: of users that you know, go beyond their first or
Speaker 2: second trade and kind of continue on and build and
Speaker 2: grow versus like they tried something out and kind of
Speaker 2: just said, oh, it's not for me. I don't know
Speaker 2: what I'm doing.
Speaker 1: With consumer technology, there's sort of a funnel for everything.
Speaker 1: You know, there's people downloading the app, not everyone who
Speaker 1: downloads the app actually ends up creating an account. Not
Speaker 1: everyone that creates an account funds it. And you know,
Speaker 1: we're definitely focused on making sure that we have a
Speaker 1: really good funnel, that it's clean, that people who you know,
Speaker 1: enter are getting exactly what they want. I adventure to
Speaker 1: say that our funnel is probably much more efficient than
Speaker 1: those of our competitors. That said, there are things that
Speaker 1: certain customers want that. We're not like ideal at offering now.
Speaker 1: So for example, if you want an advisor. A lot
Speaker 1: of people want a financial advisor. They want someone to
Speaker 1: manage their money for them, tell them exactly what to do.
Speaker 1: We don't have a great comprehensive solution for that yet,
Speaker 1: although we're working on it. I think we will get
Speaker 1: there eventually one of the advisors, I think AI certainly
Speaker 1: will be involved, if not you know, replacing the advisors,
Speaker 1: certainly augmenting and giving them kind of superhuman capabilities and
Speaker 1: the ability to service more customers. But yeah, I think
Speaker 1: that's certainly one of the most interesting applications of AI
Speaker 1: and financial services. But yeah, right now, the platform is
Speaker 1: like very self directed. It's for folks that want to
Speaker 1: be in control of their money, and like, you know,
Speaker 1: like the the most hardcore Robinhood users are the ones
Speaker 1: that really are just kind of like optimizing everything, you know,
Speaker 1: they're optimizing their taxes, they're optimizing all of their fees
Speaker 1: and commissions. And we do attract some of those people
Speaker 1: that really want to be hands on with everything because
Speaker 1: it's a very easy to use tool we have. We
Speaker 1: tend to have the lowest pricing across all services that
Speaker 1: we offer. We sort of like from the very beginning,
Speaker 1: have built with like the self directed retail customer in mind.
Speaker 1: So I think for that customer, there's probably no better fit.
Speaker 1: If you want to be in control over every aspect
Speaker 1: of your finances and you actually in some cases are
Speaker 1: openly distrustful of other people telling you what to do,
Speaker 1: and they're there's a lot of people like that. They're like,
Speaker 1: I don't even want to listen to a financial advisor
Speaker 1: because I feel like they're just gonna talk down on
Speaker 1: me in a good scenario or rip me off in
Speaker 1: like a bad scenario. And those people are like, yeah,
Speaker 1: like they tend to gravitate toward robin Hood.
Speaker 2: Before we dive into the next moment, let's hear from
Speaker 2: our sponsors, and now let's get back to the episode.
Speaker 2: At a time when investing is becoming more talked about,
Speaker 2: more diverse, there's more options. I want to get your
Speaker 2: personal opinion on people think about stocks versus people think
Speaker 2: about property, for example, which of course is far more expensive.
Speaker 2: But I feel like we've seen a generational shift from
Speaker 2: people wanting to own their homes, purchase their homes, get
Speaker 2: a mortgage versus now people moving towards renting more. Are
Speaker 2: you seeing that trend? And are you seeing people move
Speaker 2: towards stocks? So you still what's your personal take on
Speaker 2: people choosing between buying and renting versus using that capital elsewhere.
Speaker 1: For a while, the American dream involved home ownership, yes, right,
Speaker 1: and I have mixed feelings about it, to be honest,
Speaker 1: because there's a lot of like corporate interests that are
Speaker 1: pushing for more homeownership. I mean, if you're a bank
Speaker 1: and you're giving people mortgages. You know a lot of
Speaker 1: people criticize leverage in the stock market, but if you
Speaker 1: think about the amount of leverage in a thirty year
Speaker 1: fixed mortgage, right, it's like ungodly right, you end up
Speaker 1: paying much more in interest than you know, even the
Speaker 1: principle sometimes yeah, I mean again, without getting into investing advice,
Speaker 1: real estate I think has been tempting for people because like,
Speaker 1: you can see it, you can touch it. It's sort
Speaker 1: of like this thing that you can use and it
Speaker 1: feels like an investment, even though it really isn't, especially
Speaker 1: when you give when you take into account all the fees,
Speaker 1: like the brokering fees on either side of the transaction, property, taxes, maintenance. Meanwhile,
Speaker 1: you know in the stock market, you have it on
Speaker 1: your phone now, commission free, some of the lowest fees,
Speaker 1: access to like the widest variety of companies that are
Speaker 1: really even though it's the US market, by and large,
Speaker 1: the US markets increasingly global. I think, and I wrote
Speaker 1: this article back in twenty twenty one, investing in the
Speaker 1: global markets is really the new American dream. And actually,
Speaker 1: during the hyperinflation episode in Bulgarian the nineties, my grandparents
Speaker 1: didn't have access to any tools that allowed them to
Speaker 1: invest in equities. So my grandfather, who was a medical
Speaker 1: doctor on navy vessels in Bulgaria, he had like a
Speaker 1: contact on the port side who would basic give them
Speaker 1: access to copper cookware. So he would take his Bulgarian
Speaker 1: leves from his pension and get copper cookware. We had
Speaker 1: this closet. They had this closet in their apartment that
Speaker 1: was just full of copper cookware, and that was like
Speaker 1: that was their robinhood app like that's where they would
Speaker 1: self custody their wealth. I mean, right now you can
Speaker 1: buy any stock, you can buy crypto. We started offering
Speaker 1: crypto in twenty eighteen for the lowest fees in the industry,
Speaker 1: and you can get you know, you can get access
Speaker 1: to ETFs, you can have gold ETFs, so really in
Speaker 1: your pocket you can diversify and hold pretty much any
Speaker 1: asset and you can even do real estate through the
Speaker 1: form of reats and other publicly traded ETFs. Yeah, you
Speaker 1: can get exposure to that asset class. But like real
Speaker 1: estate investing in terms of buying a primary home yet,
Speaker 1: it's I think the story behind that is is difficult.
Speaker 1: It's like very liquid, high transaction fees. You're kind of
Speaker 1: like picking a particular neighborhood. So even if the global
Speaker 1: real estate market does well, something could happen to that neighborhood.
Speaker 1: You know, you build a power plant next door, and
Speaker 1: you're kind of in big trouble. So even though I'm
Speaker 1: not making any investment recommendations, I think it's yeah, it's
Speaker 1: hard to kind of like equate those two. I think
Speaker 1: really the future is going much more toward investing in
Speaker 1: publicly traded stocks and cryptocurrencies.
Speaker 2: Yeah, yeah, that's what I want to ask your opinion,
Speaker 2: So yeah, definitely not official advice. I've read an amazing
Speaker 2: stat that said the next generation is set to inherit
Speaker 2: an estimated seventy two trillion dollars over the next twenty years,
Speaker 2: with twenty seven trillion going to millennials alone. Yes, and
Speaker 2: that blows my mind because first of all, I'm like,
Speaker 2: who are those millennials'.
Speaker 1: Big wealth transfer, big wealth trends?
Speaker 2: When someone like you hear is that, what goes through
Speaker 2: your mind.
Speaker 1: What goes through my mind is there's a big opportunity
Speaker 1: for Robinhood. There's a big opportunity for us because we've
Speaker 1: got more millennial app users than basically all the incumbent
Speaker 1: brokerage competitors put together, even more so gen Z. I
Speaker 1: think if you look at gen Z, over sixty percent
Speaker 1: of our competitive set just uses Robinhood. And so we
Speaker 1: already have relationships with these folks and we're offering more,
Speaker 1: Like we don't just offer stocks. We have an awesome
Speaker 1: credit card, we have among the best retirement products, an
Speaker 1: amazing retirement product with a first built in match in
Speaker 1: an IRA. We have a high yield product, and we're
Speaker 1: adding just more and more over time, and we're making
Speaker 1: it really easy to transfer your account. If you're you know,
Speaker 1: a customer of a legacy brokerage to Robinhood so you
Speaker 1: can take advantage of all these amazing and rates and
Speaker 1: the user experience. So yeah, I think that we'd like
Speaker 1: to put ourselves in the position where Robinhood is like
Speaker 1: the home for all of these assets, and I think
Speaker 1: I think we're rapidly getting there.
Speaker 2: What do you think you've done differently to attract those
Speaker 2: groups and those communities into your space, Like, what what's
Speaker 2: been the big difference.
Speaker 1: I'd like to say that the way we communicate and
Speaker 1: the marketing is a big part of it, But I
Speaker 1: think the biggest thing is like the the economics, getting
Speaker 1: rid of account minimums and trading commissions, removing the friction.
Speaker 1: These are all barriers that prevented people. Yeah, I think
Speaker 1: I mentioned to you earlier that you know, before Robinhood,
Speaker 1: if you had one hundred dollars, it would have just
Speaker 1: been nonsensical to invest. The fees would have just ripped
Speaker 1: the part of your portfolio. And you know a lot
Speaker 1: of times there were barriers that prevented you from getting
Speaker 1: started in the form of minimum account balance requirements as well.
Speaker 1: So we got rid of all of those and basically
Speaker 1: that allowed a whole bunch of customers that were previously
Speaker 1: under served to be able to open accounts, and you know,
Speaker 1: unfortunately a lot of those customers were from disadvantage historical demographics.
Speaker 1: And you know, I think it's a great thing that
Speaker 1: we've now kind of opened the doors to basically everyone
Speaker 1: to open up an account and become an investor.
Speaker 2: Yeah, similar to the to the property question, I wanted
Speaker 2: to know your take on traditional retirement accounts like the
Speaker 2: four oh one K, like in comparison to the more
Speaker 2: aggress aggressive growth strategies in stocks, like what's your what's
Speaker 2: your take there? Again from an opinion base.
Speaker 1: Yeah, so four one k's are fantastic, Uh, for those
Speaker 1: that you know are privileged to have an employer that
Speaker 1: offers one. In particular, if an employer offers a four
Speaker 1: oh one K with a built in match and they're
Speaker 1: matching your contributions, you know, that's free money. So that
Speaker 1: value prop is very very strong. But you know, not
Speaker 1: everyone has access to that, And so what we've done
Speaker 1: is and actually I think over time, users and kind
Speaker 1: of end consumers can be less reliant on individual employers.
Speaker 1: I mean, it used to be that you would have
Speaker 1: a job and you could like count on that employer's
Speaker 1: pension to take care of you. You know, maybe you'd
Speaker 1: work at the same employer for twenty thirty years, then
Speaker 1: you'd retire and you would kind of subsist on the
Speaker 1: pension plan, and then of course social Security kind of
Speaker 1: filled in some of the gaps. But I'd say the
Speaker 1: future of Social Security is very much shrouded and a
Speaker 1: cloud of uncertainty, right, So I think the upshot is
Speaker 1: people have to take it upon themselves to be responsible
Speaker 1: for their own finances and their own retirement. I don't
Speaker 1: think that you can rely on the government. I don't
Speaker 1: think you can rely on any one employer. Many people
Speaker 1: aren't sticking around at a single employer for very long now,
Speaker 1: And so what's important is having these investment accounts not
Speaker 1: tied to the employer and actually tied to the user.
Speaker 1: You're kind of carrying around your retirement with you. And
Speaker 1: that's why we launched our IRA products, your individual retirement accounts.
Speaker 1: So we offer roths and individual retirement accounts. If you're
Speaker 1: a Robinhood Gold subscriber, you get a three percent match
Speaker 1: on contributions. So basically you might not have an employer
Speaker 1: matching you, but Robinhood will match out of our own
Speaker 1: economics in a world where you can't rely on a
Speaker 1: single employer and you have these accounts that should travel
Speaker 1: with you. I think that it's much more future proof
Speaker 1: and the product's really been resonating. You know. We had
Speaker 1: end of twenty twenty three, which was the first year
Speaker 1: that we launched our retirement products, we had about one
Speaker 1: point seven billion in assets under custody and that's gone
Speaker 1: up more than six x since the beginning of the year,
Speaker 1: so now we have close to ten billion in assets
Speaker 1: in retirement accounts at Robinhood.
Speaker 2: Was that more recent development or was that something that
Speaker 2: was always part of the plan.
Speaker 1: We had always talked about offering retirement products. There's just
Speaker 1: I mean, the financial space is so big and there's
Speaker 1: so much that we want to do that the order
Speaker 1: of things becomes important and which what's first, And you know,
Speaker 1: there's sort of like always a balancing act between innovative
Speaker 1: new features that you don't find anywhere else but Robinhood.
Speaker 1: And those are things like twenty four hour market offering,
Speaker 1: which allows you to trade stocks twenty four hours a day,
Speaker 1: and we're the first to market with that for individual
Speaker 1: stocks like Tesla and Nvidia and Apple, things like retirement
Speaker 1: accounts that others offer, but you know, we'd have to
Speaker 1: kind of like catch up and add them, and of
Speaker 1: course we try to put our innovative twist, like the
Speaker 1: matches onto them. And then there's just like scaling the infrastructure,
Speaker 1: and that includes things like customer support and just making
Speaker 1: sure that the infrastructure gets more reliable and sophisticated to
Speaker 1: handle more, which you know, as we're expanding globally and
Speaker 1: servicing other customers in different countries is also a giant
Speaker 1: area of investment for us.
Speaker 2: It's so interesting, isn't it, Because I feel like you're
Speaker 2: seeing all these new disruptive platforms. Technologies give people so
Speaker 2: much opportunity that wasn't accessible before, but often they come
Speaker 2: under even more scrutiny and challenged then banks or anything
Speaker 2: anything else did in the in previous years. I was
Speaker 2: wondering what your take on the GameStop movie was. I
Speaker 2: don't know if you saw it.
Speaker 1: Did you get to see it or I saw some
Speaker 1: clips of it?
Speaker 2: Okay, yeah, what was the full thing? No?
Speaker 1: I mean I saw the clips that I was in.
Speaker 1: Of course I wanted to I wanted to see how
Speaker 1: I was portrayed certainly not out of vanity or anything
Speaker 1: like that.
Speaker 2: Did they have to ask permission for that? No?
Speaker 1: It was kind of the weirdest thing. You know, your
Speaker 1: likeness and name can just be kind of taken and monetized.
Speaker 1: And I don't think the movie made very much money,
Speaker 1: But yeah, they certainly didn't ask for permission, right.
Speaker 2: And then when you saw the clips of you and
Speaker 2: how did you feel? Like? How did that?
Speaker 1: I thought they kind of got my mannerisms right. It
Speaker 1: made sense because I think they probably looked at interviews
Speaker 1: that I'd done, and you know, they they basically had
Speaker 1: figured out sort of like my way of speaking. And uh,
Speaker 1: you know, the actor that played me was very good
Speaker 1: looking guy, you know, the Winter Soldier. I think they
Speaker 1: had to kind of make him look a little uglier
Speaker 1: so he could he could more accurately portray me. But hey,
Speaker 1: I'm not complaining. The plot was obviously like complete fabrication.
Speaker 1: I think people really liked this whole conspiracy theory thing,
Speaker 1: and you know, there was this like conspiracy theory of
Speaker 1: collusion floating floating around particularly at that time, So I
Speaker 1: don't think they could actually like explicitly say the conspiracy theory,
Speaker 1: but they were just evoking it in all sorts of ways,
Speaker 1: So those parts were fictional, but I think they got
Speaker 1: my mannerisms right.
Speaker 2: And then I mean I saw you do at the time.
Speaker 2: You did tons of interviews. I think you did a
Speaker 2: clubhouse with Elon and yeah, there are a bunch of
Speaker 2: different things that I saw that you did at the time.
Speaker 2: What does it feel now reflecting back on that time,
Speaker 2: because I imagine that there was so much scrutiny, there
Speaker 2: was so much conspiracy, there was How have you felt
Speaker 2: about it since then? Like now you can look backwards
Speaker 2: eye on it, I guess as supposed to at that time,
Speaker 2: where you're looking right at it. What's changed over the
Speaker 2: last three years.
Speaker 1: Yeah, you know, from time to time I do look
Speaker 1: at like some old clips of my interviews back then,
Speaker 1: and you know, I kind of feel bad for myself
Speaker 1: because I was like a little kid, you know. It
Speaker 1: just the company was private. I was always particularly at
Speaker 1: that time, I was just very focused on getting the
Speaker 1: technology to work, and I didn't really want to be
Speaker 1: in the public eye. And I certainly didn't see myself
Speaker 1: as you know, some kind of political figure wrapped up
Speaker 1: in some kind of political quarrel over investing or regulation.
Speaker 1: I think what happened was, you know, GameStop for better
Speaker 1: or worse put robin Hood sort of like firmly into
Speaker 1: the zeitgeist right before it was a little fringe. I mean,
Speaker 1: we still had a lot of customers, but we weren't
Speaker 1: we weren't like a politicized brand. And I think at
Speaker 1: that point I really had to learn really quickly not
Speaker 1: just how to like build technology and lead teams to
Speaker 1: do it, but also how to represent the company. And
Speaker 1: you know, it's like you can see in those interviews,
Speaker 1: I'm kind of like reading a script and that was
Speaker 1: my approach to interviews for a while. It was like
Speaker 1: reading my points and trying to communicate the facts of
Speaker 1: the message. But you know now now, I know now
Speaker 1: that I'm much more wise and mature and still not
Speaker 1: nearly as as experienced as you. You've probably done thousands
Speaker 1: of these, right, but it doesn't really resonate with our audience.
Speaker 1: To just like read the facts, you have to give
Speaker 1: some emotion and some feeling and have some empathy, and
Speaker 1: you know, there has to be a little bit more.
Speaker 1: So I've had to kind of learn all that stuff.
Speaker 1: And now they just look incredibly inauthentic and robotic. And
Speaker 1: I think the the more time has passed, the more
Speaker 1: I'm kind of trying to be as authentic as possible
Speaker 1: in my appearances. And I think that had to be
Speaker 1: had to be something that I learned and doing so,
Speaker 1: especially in that time where the stakes were super high
Speaker 1: and we were about to go public, and you know,
Speaker 1: you have like all sorts of advisors and lawyers and
Speaker 1: you know, professionals that are trying to protect me and
Speaker 1: the firm, say, don't say this, be careful not to
Speaker 1: say this. Be careful when you're kind of making this
Speaker 1: point that you don't make people think that you're actually
Speaker 1: meaning this. So and if you're kind of running the
Speaker 1: algorithm through your head of like what you can't say
Speaker 1: and what you what you should say, and how what
Speaker 1: you're saying could be kind of like interpret.
Speaker 2: Did it's exhausting hearing exactly. Yeah.
Speaker 1: Eventually, to some degree, like you practice enough and it
Speaker 1: becomes second nature and you can kind of rip up
Speaker 1: all the guidelines and be pretty confident that you're doing
Speaker 1: the right thing. But I think it has to be authentic.
Speaker 1: And back then I was just like very inexperienced at
Speaker 1: all this stuff. I sort of undervalued it, and I
Speaker 1: think it took a while for me to get to
Speaker 1: like a basic level of competency.
Speaker 2: Yeah. No, I mean I think it's fair. I think
Speaker 2: that every founder goes through that journey of like you've
Speaker 2: been building something in private in a room or an
Speaker 2: office for so many years, and all of a sudden
Speaker 2: your company gets notoriety in mainstream culture, and then all
Speaker 2: of a sudden you're having to do things that you
Speaker 2: don't necessarily set out to do as a founder. I
Speaker 2: feel like even actors go through that way. You're just
Speaker 2: working on a movie on a set and then you
Speaker 2: have to go promote the movie, but or you're seen
Speaker 2: in public and something impacts the movie, and that wasn't
Speaker 2: necessarily what you signed up for. What were the actual
Speaker 2: ramifications or consequences of all of that, Like, what actually,
Speaker 2: how did that actually affect Robinie apart from the cultural propelling.
Speaker 1: Well, I think a lot of a lot of people
Speaker 1: who were just like looking at me at the time,
Speaker 1: and maybe we're not Robinhood users themselves. Maybe some of
Speaker 1: them were Robinhood users, but others were kind of thinking
Speaker 1: about it and were aware of it. I think some
Speaker 1: people got the impression that I just like maybe didn't
Speaker 1: care about our customers, and I think that was the
Speaker 1: part that actually like pained me and kind of stayed
Speaker 1: with me over time. They're like, oh, look at him,
Speaker 1: he doesn't have any emotions and he's just like talking
Speaker 1: about these clearing house regulatory requirements, but he doesn't understand
Speaker 1: the pain that kind of customers went through who wanted
Speaker 1: to you know, buy game stop or AMC or all
Speaker 1: these other things. I mean, like, I definitely understood the
Speaker 1: pain that those were some of the most painful sleepless
Speaker 1: nights for me going through that whole uh ordeal. But yeah,
Speaker 1: my approach was always just I'm I don't I don't
Speaker 1: want to like talk about doing stuff. I like to
Speaker 1: do stuff, so uh, I'm not gonna like, maybe maybe
Speaker 1: I'm not going to be like super emotive with my customers,
Speaker 1: but I'm just gonna build them great products that save
Speaker 1: them tons of money and give them a great experience
Speaker 1: so that they could learn to invest and manage their money.
Speaker 1: I think that was painful. Obviously, the collusion narrative was
Speaker 1: painful because.
Speaker 2: It was like proven there's no there's no.
Speaker 1: It was disproven. I mean, learning how to communicate and
Speaker 1: actually like to some degree, like going through a crisis
Speaker 1: and then surviving and then sort of like learning from
Speaker 1: it and building building back better so that you don't
Speaker 1: actually repeat the same thing again. I mean, Robin Hood's
Speaker 1: had our share of issues over the years. Like we
Speaker 1: definitely haven't been perfect. But I mean one thing I'm
Speaker 1: proud of is they're all like we've made mistakes, but
Speaker 1: they're a series of original mistakes, so we tend not
Speaker 1: to make the you know, same mistake twice, and so
Speaker 1: like throughout all of these we've just like built up
Speaker 1: a ton of scar tissue and learnings and have been
Speaker 1: a much stronger company. And I think all of this,
Speaker 1: all of the crises, you know, I remember the dates.
Speaker 1: You know, It's like, you know, it's like January twenty eight,
Speaker 1: twenty twenty one, or December twelfth, twenty eighteen, or March second,
Speaker 1: twenty twenty right at the beginning of COVID when we
Speaker 1: had a day long trading outage. So you kind of
Speaker 1: remember all of these events and kind of take different
Speaker 1: things away from them. But I mean, at the end
Speaker 1: of the day, we've been a company for ten years
Speaker 1: and you're gonna if you're in a disruptive space where
Speaker 1: you're kind of challenging the status quo and trying to
Speaker 1: change things, some people are if some people are going
Speaker 1: to be unhappy, right, and you have to have thick
Speaker 1: skin to kind of get through that.
Speaker 2: Yeah, it's an interesting dynamic, isn't it. When when companies
Speaker 2: are doing something for the first times, it's inevitable that
Speaker 2: there's going to be mistakes and mismanagement and challenges.
Speaker 1: And I think and it's almost like, you know, if
Speaker 1: you're being too careful, if you actually make zero mistakes,
Speaker 1: you might not be successful. You're probably aren't going to
Speaker 1: be successful because you're just like not pushing hard enough.
Speaker 1: Like it's like he at some point, not taking any
Speaker 1: risk is like the biggest risk of all, particularly in
Speaker 1: like a hot competitive market. So you just you have
Speaker 1: to know the right amount. I think it's a it's
Speaker 1: somewhat of a fine dance, but it's it's certainly not
Speaker 1: acceptable to like play everything super safe in the world
Speaker 1: world of business.
Speaker 2: And I guess the challenge is because it's dealing with
Speaker 2: people's money, it's even a more heightened.
Speaker 1: There's a heightened sense of safety. Yeah, absolutely, yeah, and
Speaker 1: people can be very emotional about their money.
Speaker 2: But first, here's a quick word from the brands that
Speaker 2: support the show. All right, thank you to our sponsors.
Speaker 2: Now let's dive back in. What were some of the
Speaker 2: biggest mistakes that you felt and the lessons you learned
Speaker 2: from them that were so pivotal that you think would
Speaker 2: be useful for other founders, for customers to hear, for
Speaker 2: other people to just be aware of, Like this is
Speaker 2: how you now look at it versus at the time
Speaker 2: when you're like, well, we need to be risk pro
Speaker 2: risk try things out.
Speaker 1: Designing our infrastructure with scalability in mind from day one
Speaker 1: probably would have saved us quite a bit of grief
Speaker 1: because we've had to like rewrite and like redo multiple times.
Speaker 1: The conventional wisdom is you don't want to prematurely optimize anything.
Speaker 1: The Silicon Valley sort of like tombs are littered with
Speaker 1: corpses of startups that had perfect infrastructure and no users,
Speaker 1: you know. Yeah, yeah, So it's always hard to do
Speaker 1: the counterfactual on these things, because like you know, if
Speaker 1: we had if we had overinvested in those things, maybe
Speaker 1: we like wouldn't have customers and then no problems but
Speaker 1: no customers, right. I think we can end up being
Speaker 1: like tormented by our pass too much. So I don't
Speaker 1: even I don't know how helpful it is.
Speaker 2: Yeah, that's that's an interesting take. I can see why.
Speaker 2: I can definitely see why. I mean, the only thing
Speaker 2: that stood out to me was you saying that your
Speaker 2: most difficult period was in twenty twenty two, when Robin
Speaker 2: Hude's business took a hit amid the market downturn. Yeah,
Speaker 2: that's true, and I feel like what was so what
Speaker 2: was what was so tough for you personally about that?
Speaker 1: I mean you've Yeah, some people might hear that and
Speaker 1: be like that's crazy, Like how can that compare to
Speaker 1: Game Stop?
Speaker 2: Right?
Speaker 1: I think the thing about Game Stop was like very
Speaker 1: acute difficulty, you know, and it was like almost like
Speaker 1: a roller coaster ride. You know, it's like intense, but
Speaker 1: it's over in three minutes, and it's kind of clear
Speaker 1: what you have to do to get out of that
Speaker 1: difficult situation. You know, we navigated it, we became stronger company.
Speaker 1: Twenty twenty two was like a slower burn, right, and
Speaker 1: we had just gone public in middle of twenty twenty
Speaker 1: one kind of at the end of the window. The
Speaker 1: window has kind of been basically shut since then for IPOs, right,
Speaker 1: and we kind of squeezed in right before things got
Speaker 1: really bad. And so what happened was you had this
Speaker 1: period where it became clear that inflation was getting completely
Speaker 1: out of hand, and that freaked everyone out. And then
Speaker 1: it became clear that the FED was going to hike rates,
Speaker 1: and we had kind of like everyone was prepared for
Speaker 1: a multi year period of like zero rates, and you know,
Speaker 1: to tame inflation, the FED, who hadn't really dealt with
Speaker 1: inflation for thirty years, had to hike rates up at
Speaker 1: the fastest pace in the past several decades. And what
Speaker 1: happens was when rates go up, people typically invest less
Speaker 1: because you imagine, if you can get five percent on
Speaker 1: your cash just sitting there and the stock market appreciates,
Speaker 1: you know, seven to ten percent each year pre tax,
Speaker 1: and you can get that five percent rate without taking
Speaker 1: on market risk, that becomes much more much more compelling relatively,
Speaker 1: so you'll have less investing. And then that's what we saw.
Speaker 1: Less people were interested in opening up brokerage accounts and
Speaker 1: investing for the first time, and that was like our
Speaker 1: whole business. You know, that was the core of our business,
Speaker 1: and we didn't really have anything for a high rate
Speaker 1: environ at that time. And you know, there was some
Speaker 1: criticism of this when we went public and some questions,
Speaker 1: you know, the analysts and investors would be like, well, Robinhood,
Speaker 1: you've done really well during COVID and during this extended
Speaker 1: period of zero rates. The company has gone to twenty
Speaker 1: million users in that time. But how are you guys
Speaker 1: going to do in a environment where the interest rates
Speaker 1: are higher? You know, is this just is Robinhood a
Speaker 1: zero interest rate phenomenon. Of course, you know we had
Speaker 1: answers to that, but until you prove that, people don't
Speaker 1: really believe you. And so we actually had to like
Speaker 1: go through an incredibly challenging process of like changing the
Speaker 1: strategy of the company, effectively refounding the company in twenty
Speaker 1: twenty two, when you know, the entire macro environment shifted,
Speaker 1: and I think we we did a really good job.
Speaker 1: I mean, within six months after that we had gone
Speaker 1: adjusted ebadat positive. In twenty twenty three, we had gap
Speaker 1: profitability at the first time. We now have eight business
Speaker 1: lines that are generating one hundred million in revenue or
Speaker 1: more so, the business is very diversified. More than half
Speaker 1: of the rent revenue is interest rather than transactions. And
Speaker 1: now we're starting to get the question, Wow, like Robinwood
Speaker 1: is doing so well in this high interest rate environment,
Speaker 1: the Fed's going to cut rates. What are you guys
Speaker 1: going to do when when the Fed cuts the rates?
Speaker 1: And like, you can't. You can't have these like high
Speaker 1: interest rate revenue streams firing on all cylinders now, So
Speaker 1: now we have to go backwards and and prove that
Speaker 1: customers still would want to trade options and crypto inequities.
Speaker 1: So it was I think, n interesting.
Speaker 2: Yeah, it's funny how it just keeps uscillating between cycling.
Speaker 1: I guess, well, the more times you do that cycle.
Speaker 1: I always felt like when we were private, every time
Speaker 1: we raised a new round of funding, we had to
Speaker 1: kind of like reprove ourselves to these new investors that
Speaker 1: came in and just didn't understand the company. But then,
Speaker 1: you know, the longer we lasted, as we got up
Speaker 1: to like Series H I think in private funding, and
Speaker 1: you know, by that point, the Series ABC investors had
Speaker 1: developed such a deep understanding of the company. They had
Speaker 1: so much trust and I think it's the same with
Speaker 1: the public company, or at least i'd like to think. So,
Speaker 1: you know, you pick your investors, your investors pick you,
Speaker 1: and the more cycles we go through, we are building
Speaker 1: institutional knowledge as a public company, and I do think that,
Speaker 1: you know, the market is starting to recognize that, hey,
Speaker 1: maybe this founding team, the management team of this company
Speaker 1: knows what they're doing. And the more cycles we go through,
Speaker 1: I think the more we'll prove that out.
Speaker 2: Yeah, And I think I've read somewhere where you were
Speaker 2: saying that that time really changed how you look to
Speaker 2: being a CEO and a leader and reprioritizing the company.
Speaker 2: Was what was you You just talked there about almost
Speaker 2: what you did in terms of building product, diversifying income streams,
Speaker 2: you know, having all of the portfolio of how people
Speaker 2: could use Robin hood, But what was that like for
Speaker 2: you internally from a leadership per cective? What changed as
Speaker 2: how you about how you led?
Speaker 1: Yeah, So there was this exercise that I would go
Speaker 1: through with with some of my team where I would
Speaker 1: imagine if a new person came into the roles as CEO.
Speaker 1: And I've told this story a couple of times, and
Speaker 1: it's not like I imagine myself being fire. I was
Speaker 1: worried about that or anything like that, but it was
Speaker 1: almost like, Okay, this thought exercise of let's say I
Speaker 1: didn't come with any of the baggage of like having
Speaker 1: founded the company and made all the decisions to get
Speaker 1: us to this point. If I could look at it
Speaker 1: from with a beginner's mind and just say, hey, I'm here,
Speaker 1: I'm seeing this company, this is kind of the state
Speaker 1: of affairs. What would I do differently? And you know,
Speaker 1: I came up with a bunch of things that like
Speaker 1: a stereotypical like top CEO coming in would do differently.
Speaker 1: They would pull back on remote first and get people
Speaker 1: in the office so they could collaborate and work together
Speaker 1: in person. And even though I had turned Robinhood into
Speaker 1: a remote first company not too long before, I reversed
Speaker 1: my own decision there, which was kind of tough from
Speaker 1: a self consistency standpoint. People have a very hard time
Speaker 1: being inconsistent with their prior selves. So I think that's
Speaker 1: like one mental barrier to get past. Another one was
Speaker 1: I just made this realization that you know, if you
Speaker 1: look at our business, a lot of our revenue is
Speaker 1: generated by you know, relatively small component of very active traders,
Speaker 1: and we actually weren't building products specifically for them. And
Speaker 1: as a matter of fact, we looked at kind of
Speaker 1: this customer base very deeply in twenty twenty two, and
Speaker 1: these folks tend to be more sophisticated. So actually, when
Speaker 1: when the markets are crashing or moving sideways, they tend
Speaker 1: to actually be more resilient because they can deploy more
Speaker 1: sophisticated strategies that can take advantage of all sorts of
Speaker 1: market environments. And we saw what we saw was the
Speaker 1: more active someone traded Airgo, the more revenue they generated
Speaker 1: for us, the less happy they were with Robinhood. So
Speaker 1: so actually our most active customers had like the least
Speaker 1: customer satisfaction with the platform. So then when we kind
Speaker 1: of like grock this, we were like, this is a
Speaker 1: five alarm fire, like any healthy business, Like, you know,
Speaker 1: you don't.
Speaker 2: Have to be an MBA.
Speaker 1: From Wharton to realize that your most valuable customers being
Speaker 1: like unhappy with you is a big problem. So but
Speaker 1: what was remarkable was when we kind of like shifted
Speaker 1: focus towards making these active trader traders really really happy,
Speaker 1: we fixed it like that like much faster than I
Speaker 1: thought possible. I think within six months we had basically
Speaker 1: like solved the problem. Yeah, it's kind of interesting, a
Speaker 1: lot of introspection to how we ended up sort of
Speaker 1: like ignoring the active trader audience for for so long.
Speaker 1: I think once we sort of like refocused on that
Speaker 1: and and really started treating them like the important constituent
Speaker 1: part of the user base that they are. Uh, the
Speaker 1: company just started doing much better. I think by and
Speaker 1: large that was the biggest part of our of our
Speaker 1: turnaround as a company since going public.
Speaker 2: That's that's fascinating. I mean to to discover that your
Speaker 2: deepest us is on Yeah, it must be like such
Speaker 2: a yeah.
Speaker 1: And part of it was like Robinhood was historically very targeted,
Speaker 1: very focused on the first timers. We want to be
Speaker 1: someone's first brokerage account. We want to make it easyasy
Speaker 1: as possible to get started with five dollars, right. But
Speaker 1: what happened was one a lot of the people that
Speaker 1: got started with us then became really sophisticated and like
Speaker 1: wanted more advanced tools and had more specialized needs, but
Speaker 1: still loved Robinhood and loved the simplicity and the easy
Speaker 1: abuse of the interface. But the other part was if
Speaker 1: you think about our options trading platform. For example, we're
Speaker 1: one of the few, very few that offer options trading
Speaker 1: for no contract fees. Most of our competitors charged sixty
Speaker 1: five cents per options contract, So if you trade one
Speaker 1: hundred contracts, that's sixty five dollars. That's real money. And
Speaker 1: there's some active traders that you know, spend thousands of
Speaker 1: dollars a month on other platforms paying these contract fees.
Speaker 1: So even if like the platforms not really built for you,
Speaker 1: there's like a really strong economic incentive to use it.
Speaker 1: So you had a lot of these like super active
Speaker 1: options traders that were using Schwab or e Trade or others.
Speaker 1: Maybe they're using their charting from their other platform, but
Speaker 1: they're putting the trades in via Robinhood and just to
Speaker 1: save fees. So you know, we grew active traders. We
Speaker 1: also had some using us because the economics were so good. Yeah,
Speaker 1: and that way we sort of like built up this
Speaker 1: large active trader business. Incidentally, while building products for first
Speaker 1: time novice investors.
Speaker 2: Yeah, I mean, it's so interesting that since the beginning
Speaker 2: everything you talked about from the name, there's always been
Speaker 2: people who've been disgruntled, slightly angry, as you said earlier,
Speaker 2: like this feeling of like, oh, these guys are doing something,
Speaker 2: you know, has that kind of like has that kind
Speaker 2: of changed now as a company matures and like people
Speaker 2: see you become established and not obviously competitors. But when
Speaker 2: you look at the people who felt that way initially,
Speaker 2: do you find that founders are reaching out, you're more
Speaker 2: connected to people and as you've become more established as well,
Speaker 2: or does it get lonelier as things go on?
Speaker 1: Well, I think in different ways it does get lonelier,
Speaker 1: But I would say in general, I think in the
Speaker 1: past couple of years especially, we've like fixed more problems
Speaker 1: than we've created, hopefully, and so our customers generally have
Speaker 1: been getting happier and happier, not just the active traders,
Speaker 1: but you know, the great thing when you fix things
Speaker 1: for active traders, they're like power users of the platform,
Speaker 1: so the customer experience for a more casual user improves
Speaker 1: as well. So yeah, fortunately, you know, again knock on wood,
Speaker 1: we've been like we've been avoiding like major catastrophes in
Speaker 1: the last few years, which you know, the last few
Speaker 1: years have been hard, just with standard business challenges to
Speaker 1: work through. So that's been really nice. I think, like
Speaker 1: to some degree, I don't expect Robinhood to ever be
Speaker 1: perfectly understood and non controversial, so it just comes with
Speaker 1: the comes with the territory.
Speaker 2: I guess what's made you comfortable with that? I feel
Speaker 2: like that's obviously always hard. We always want to be liked.
Speaker 2: We want what we create to be, you know, overall
Speaker 2: seen in a certain way. What's made you comfortable with that?
Speaker 1: Well? I think the first time that, for example, I
Speaker 1: saw a negative press about Robinhood probably was like twenty eighteen,
Speaker 1: twenty nineteen. So for the first four to five years
Speaker 1: of the company's existence, it felt like everyone was kind
Speaker 1: of rooting for us, Like the regulators were fans, right,
Speaker 1: you know. I remember our first FINRA exam. We had,
Speaker 1: you know, someone kind of looking at what we were doing.
Speaker 1: Finn was our primary regulator, and you know, this was
Speaker 1: a young guy. He's like, hey, there's never any like
Speaker 1: new brokerages filing. This is like super interesting. I wish
Speaker 1: you guys luck. It gave me this feeling of like wow,
Speaker 1: I every investor in person I talked to was like
Speaker 1: run as far away from regulation as possible. You don't
Speaker 1: want to be a regulated business. It's going to just
Speaker 1: grind the company to a slow death, so find some
Speaker 1: way to do it via partnerships or something. When we
Speaker 1: got started, it was unheard of to like be a
Speaker 1: financially regulated startup. It was really before the word fintech existed.
Speaker 1: For example, Robin Wood predated that probably created it to
Speaker 1: some degree. And then you know, the press was always
Speaker 1: telling this David and Goliath tale where we were these
Speaker 1: little guys that were going after the you know, big, established,
Speaker 1: gigantic competitors, and you know, we had the millennials on
Speaker 1: our side, and so it was just like very very
Speaker 1: positive always, and it kind of it was like, I
Speaker 1: don't really get what all of the fuss is about,
Speaker 1: Like all of the negative press and all this stuff
Speaker 1: that people are talking about that's happening to other companies,
Speaker 1: maybe not us. Eventually I would get like the comms
Speaker 1: and marketing people that they would come and show me
Speaker 1: the clock of like company perception. Have you seen this?
Speaker 1: It's like this clock and like basically, when you're kind
Speaker 1: of here, everyone loves you, and when you're kind of.
Speaker 2: Here, everyone hates you.
Speaker 1: And they're like, so you're here at like four o'clock,
Speaker 1: but you should get ready. In the next six to
Speaker 1: twelve months, you'll be here and everyone's gonna hate you
Speaker 1: and you just haven't seen it. Yeah, and then it
Speaker 1: keeps going around and they're like, look, Facebook is here.
Speaker 1: They're like a little ahead of you. Everyone hates them now.
Speaker 1: They ended up being exact actly right. A six to
Speaker 1: twelve months later. It was like all negative press. But
Speaker 1: I guess like the way I got used to it
Speaker 1: was just going through that. Right. It's like the first
Speaker 1: time a negative article hits, you're like, holy shit, it's
Speaker 1: negative press. I've never seen it before. You kind of
Speaker 1: feel like it's the end of the world. And then
Speaker 1: you know, after the six hundredth one, you're just kind
Speaker 1: of like, Okay, it's another one of these things. I'm
Speaker 1: just gonna move on and run my business. Yeah, and
Speaker 1: then when the press turns positive, you're like positively surprised
Speaker 1: and you're not expecting it. So I think that's how
Speaker 1: I got through it. You just get punched in the
Speaker 1: face enough and your face contorts to the shape of
Speaker 1: the fist.
Speaker 2: Right, What how have you managed your personal life through
Speaker 2: all this because I feel like, you know, when we
Speaker 2: started the interview today, you talk so much about your
Speaker 2: personal life and you know how you came to this
Speaker 2: country and the build, and I feel like, you know,
Speaker 2: as you're an entrepren and your professional and personal life
Speaker 2: almost become one. And you know, when you're building something
Speaker 2: that's growing as fast as you are, you get absorbed
Speaker 2: and you have to be like you know, you sleep
Speaker 2: and dream and eat Robinhood, Like that's how it has
Speaker 2: to work, That's how it goes. What's been powerful for
Speaker 2: you in your personal life that you think is allowed
Speaker 2: you to reinvent, reboot, stay renewed, stay re enthusiastic, Like
Speaker 2: you seem as excited about robin Hood today as I
Speaker 2: imagine you would have been in twenty thirteen, if not more.
Speaker 2: And what's been allowed you to renew your enthusiasm so consistently.
Speaker 1: My kind of sort of like analogy of so many things.
Speaker 1: My mental model for so many things that I use
Speaker 1: in business and in life is kind of the barbell.
Speaker 1: Like I like to get things on opposite sides of
Speaker 1: the barbell right, and I tend to ignore the things
Speaker 1: in the middle right. So basically, for me personally, my
Speaker 1: work is like highly intellectual, and that's maybe on one extreme,
Speaker 1: and what's what's the opposite of like intellectual, just sort
Speaker 1: of like the physical. So I really focus on that,
Speaker 1: and it's just uh, super basic. And you know, when
Speaker 1: I started, I would kind of not really spend too
Speaker 1: much time and effort on my health. But as I've
Speaker 1: gotten older and the job's gotten more stressful, I notice
Speaker 1: that like effort I put in here pays off multiples. Right,
Speaker 1: So now my like wellness routine and my training, I
Speaker 1: spend more time just dialing it in so making sure
Speaker 1: I get the right amount of sleep, that I have
Speaker 1: an awesome mattress that like I keep my bed at
Speaker 1: the right temperature. I like to journal before bed, and
Speaker 1: I like to shut off the devices. The devices, by
Speaker 1: the way, has been the hard part for me. You know,
Speaker 1: I like try really hard. I have to do unnatural
Speaker 1: things to like stop from looking on my phone, like
Speaker 1: my phone's not with me right now, for example, because
Speaker 1: you know, I would just it's hard to avoid looking
Speaker 1: at it. And if I know it's in my pocket,
Speaker 1: you know, then it's almost like too close. So I mean,
Speaker 1: actually during the whole game stop stuff, it was particularly
Speaker 1: acute for me because I was at home, so there
Speaker 1: was no boundary between work and personal and I was
Speaker 1: going a little bit crazy, and so I had this
Speaker 1: thing where I would try to sleep with my phone
Speaker 1: in a different room so I'm not always just tempted
Speaker 1: to check out what emergency is happening, which ended up
Speaker 1: being a big problem the morning of game stop because
Speaker 1: it took forever for my team to like get a
Speaker 1: hold of me. And then now then for a while
Speaker 1: I slept with like three phones next to me, which
Speaker 1: it really backfired. But yeah, my health, I work out
Speaker 1: a lot. I've gotten into like hot cold therapy. At
Speaker 1: first I was doing cryo, but then I got like
Speaker 1: a cold plunge at my house that and and that
Speaker 1: really helped. And yeah, just like the basics of sleep
Speaker 1: and diet, I think has made a world of difference,
Speaker 1: and just trying to like I don't think I've figured
Speaker 1: out the device thing and sort of like my rhythm
Speaker 1: of the day perfectly, but that's a that's a work
Speaker 1: in progress.
Speaker 2: And you're marriage. You're married too, right, you mentioned, Yeah, Yeah,
Speaker 2: what's how's how's it been like dealing with all of this?
Speaker 2: But it sounds like you've been together for quite some time,
Speaker 2: Like it's.
Speaker 1: Yeah, I've been married for almost ten years now. Yeah,
Speaker 1: got a got a bunch of kids, great kids, and
Speaker 1: they don't really know what I do.
Speaker 2: Came back to how your wife to know what you did?
Speaker 1: Yeah, well she did, but yeah.
Speaker 2: Showed them at the cartoon and they'll get it.
Speaker 1: Oh yeah, they love that cartoon. I think like the
Speaker 1: credit card, they kind of get a little bit because
Speaker 1: they know they can use it to buy toys. Yeah,
Speaker 1: my wife is a great compliment to me. She's very patient,
Speaker 1: she's very empathetic all the things that I'm not, and
Speaker 1: so she's just been an amazing partner through all the crises.
Speaker 1: And she sort of like knew me before Robin Hood, right,
Speaker 1: I mean she kind of helped come up with the name.
Speaker 1: So I think I think she feels like Robinhood's like
Speaker 1: one of the children, just kind of like I do.
Speaker 2: Yeah, that's beautiful, man, I wanted to this. I'll probably
Speaker 2: cut and put back in. You mentioned the credit card there.
Speaker 2: I'm intrigued as to product you created because you saw
Speaker 2: the traditional versions of them being ineffective. So when you
Speaker 2: go build a credit card, what's wrong with a traditional
Speaker 2: credit card that you can get from anywhere else, Like
Speaker 2: what are you doing differently?
Speaker 1: I think there are a couple of problems with additional
Speaker 1: credit cards. One is that basically the rewards are kind
Speaker 1: of incomprehensible. I think that anytime there's like websites devoted
Speaker 1: to like exactly how you should kind of like work
Speaker 1: through your points to optimize the value you get from
Speaker 1: all the points, like media empires like the Points Guy
Speaker 1: were created on the back of this, right, It's like, yeah,
Speaker 1: if you want to spend ten hours a week optimizing
Speaker 1: your points and maximizing the rewards, I think that's pretty good.
Speaker 1: But we wanted to create something that simplifies all of
Speaker 1: that and basically just by like using it for the
Speaker 1: vast majority of people, you know, you get the best rewards.
Speaker 1: So simple, clear reward structure that you don't have to
Speaker 1: be like a PhD to decipher people building their credit.
Speaker 1: If you're a student and you will are you know,
Speaker 1: you don't have a credit history, typically you have to
Speaker 1: start out with like a really crappy card. You have
Speaker 1: to sort of like upgrade your way to a nicer
Speaker 1: card once you prove that you're worthy and you know
Speaker 1: there's a crappy starter card for people with no credit history,
Speaker 1: and like the premium card for folks that have the means.
Speaker 1: We asked, can we can we fix that? Can we
Speaker 1: actually have a starter card that has the same economics,
Speaker 1: the same rewards, the same design, uh for as like
Speaker 1: a highly premium card. And then the digital experience. You know,
Speaker 1: most cards don't really think through how to take all
Speaker 1: of the things that technology and you know, fintech has
Speaker 1: given us and sort of like give them to you
Speaker 1: in the same package. And those are things like virtual cards.
Speaker 1: I don't know, if you've been to a restaurant, you
Speaker 1: probably you probably go to restaurant. It's where you have
Speaker 1: to give your credit card to lock down the reservation.
Speaker 1: Imagine you could create a virtual card so that not
Speaker 1: every restaurant has your actual card number, and if you
Speaker 1: want to cancel the reservation, you don't have to call
Speaker 1: the restaurant. You could just disappear that virtual card, right
Speaker 1: Or if you want to sign up for a free trial,
Speaker 1: you can create a virtual card seamlessly and that can
Speaker 1: be your free trial card, but you don't have to
Speaker 1: give them your real phone number. Helps maintain people's privacy
Speaker 1: and in fact, there are great innovative businesses Privacy dot
Speaker 1: Com created with this notion. We put all three of
Speaker 1: these things in one package. One card for everyone, the
Speaker 1: best rewards in the industry, three percent cash back on
Speaker 1: all categories, a beautiful physical card, including the solid gold
Speaker 1: variant which I have in my wallet I can show you.
Speaker 1: And a digital experience that's like world class. And we
Speaker 1: put all these together and it's definitely the best reviewed,
Speaker 1: most popular product that we've ever rolled out, even more
Speaker 1: popular than free trading. So it's it's been quite amazing,
Speaker 1: and now it's just like like we people want to
Speaker 1: rolled out faster. That's the one limitation. We had over
Speaker 1: a million people join the wait list for it within
Speaker 1: a month of announcement. And the bet was that if
Speaker 1: we make the rewards and the product so good, we
Speaker 1: wouldn't have to spend the typical like five hundred dollars
Speaker 1: to acquire a credit card user that the big bank spend.
Speaker 1: We could get it just organically, and that seems to
Speaker 1: have proven out. Now it's just about getting it into
Speaker 1: everyone's hands while also validating the economics and the underwriting
Speaker 1: of a new credit model.
Speaker 2: That it's been fascinating talking to you. Your truly an
Speaker 2: extremely unique individual. In a positive sense, it's no thank you,
Speaker 2: it's really brilliant.
Speaker 1: Maybe some negative too, you know, brilliant.
Speaker 2: Brilliant to dive into your mind. Honestly, it's it's been
Speaker 2: really fascinating for me. We end every episode of on
Speaker 2: Purpose with the final five, so these questions have to
Speaker 2: be answered in one word to one sentence maximum. So
Speaker 2: if lad ten of Dizzy your final five. The first
Speaker 2: question is what is the best advice you've ever heard
Speaker 2: or received?
Speaker 1: Be honest, don't lie to others, but most of all,
Speaker 1: don't lie to yourself.
Speaker 2: Good advice. Question number two, what is the worst advice
Speaker 2: you've ever heard or received?
Speaker 1: I think, in the context of the company, trusting experts
Speaker 1: who have done it before is bad advice. Generally speaking,
Speaker 1: I think you have to listen to experts and understand,
Speaker 1: But like I don't think people should blindly trust anything.
Speaker 2: Question number three, if we saw one of your evening
Speaker 2: journal entries, what would we learn about you that we
Speaker 2: haven't learned today?
Speaker 1: I still really loved math, and I spend a non
Speaker 1: trivial amount of times trying to solve basic math problems.
Speaker 2: Really yeah, Oh wow, that's cool in your journal.
Speaker 1: In my journal, yeah, you'll see pictures of like triangles
Speaker 1: and spheres and stuff in there.
Speaker 2: That's cool. Fourth question, how would you define your current purpose?
Speaker 1: I think it's it's to seek truth. I think if
Speaker 1: I had to find like a personal I think a
Speaker 1: lot about like what are my what are my personal values?
Speaker 1: What do I care the most about? And I think
Speaker 1: my top value is is truth? Actually I care about truth?
Speaker 1: And I mean in terms of purpose, I really want
Speaker 1: to understand how the universe works mathematically or mathematically physically. Yeah,
Speaker 1: I mean we can start with that, but of course
Speaker 1: psychologically is good too.
Speaker 2: Cool.
Speaker 1: Financially I think we're closest to that one. Yeah, pretty
Speaker 1: close to understanding how it works financially.
Speaker 2: And how do you define truth? That's a sub question
Speaker 2: to them all the faith.
Speaker 1: I think that's a really good question. How is truth defined?
Speaker 1: I think that truth is something that multiple observers will
Speaker 1: simultaneously agree on. Yeah. So if you had like multiple
Speaker 1: independent intelligent observers observing an event with like the same information,
Speaker 1: they should agree on it. And if they agree on it,
Speaker 1: then you have like high confidence if it's true. Now,
Speaker 1: of course, if it's something that's like fact based. It's
Speaker 1: even easier because you can just like prove that it's
Speaker 1: true if it follows from axioms. But probably the more
Speaker 1: interesting one is if there's some ambiguity.
Speaker 2: Yeah, I also find but I.
Speaker 1: Think you need a notion of verification and also some
Speaker 1: notion of like independence.
Speaker 2: Yeah. One of my favorite verifications of truth I feel
Speaker 2: in my definition is timelessness. That's something being timeless. It
Speaker 2: was as true a thousand years ago as it is today.
Speaker 1: Yeah, Lindy effect right, tell me about it. Yeah, basically,
Speaker 1: like I think it was. I read about it from
Speaker 1: Nassim Taleb. Yeah, so so basically, like he says, a
Speaker 1: good approximation for how long something's likely to be relevant
Speaker 1: is how long it's already been relevant. So I think
Speaker 1: the way he kind of describes it as the New
Speaker 1: York Times bestseller list, if a book sort of like
Speaker 1: hits the best seller list and is a best seller
Speaker 1: for one week, you can basically assume that it's going
Speaker 1: to be irrelevant in a couple of weeks. Right, But
Speaker 1: if you know the Holy Bible people have been reading
Speaker 1: it for two thousand years, you have pretty high confidence
Speaker 1: that it might it's it's going to be relevant in
Speaker 1: two thousand years from now in a way that you
Speaker 1: wouldn't with what's on the bestseller list now.
Speaker 2: Absolutely.
Speaker 1: Absolutely.
Speaker 2: Fifth and final question, we asked this to every guest
Speaker 2: who's ever been on the show. If you could create
Speaker 2: one law that everyone in the world had to follow,
Speaker 2: what would it be.
Speaker 1: I think there's too many laws. Yeah, I think deleting
Speaker 1: laws is the more interesting thing. If there was a
Speaker 1: law where in order to create a new law, you
Speaker 1: had to delete at least one existing law, I would
Speaker 1: feel much better about it.
Speaker 2: That's a good law.
Speaker 1: If you think about overregulation, which I think is a
Speaker 1: big problem, it's really really easy for new laws to
Speaker 1: be created. It's easy for like organizations and the government
Speaker 1: to get bigger, and that creates all sorts of problems,
Speaker 1: Like it's impossible to get you know, high speed rail
Speaker 1: in California. Right we need a force to counteract that.
Speaker 1: And right now it's very easy for these things to
Speaker 1: get bigger and more laws. But like periodically we've got
Speaker 1: to go in there and slash laws and make things smaller,
Speaker 1: and there's there's a lot of pressure against this.
Speaker 2: Well said Vlad. I look forward to many more conversations
Speaker 2: with the philosophical, seeking of the truth, psychological. Truly, truly
Speaker 2: wonderful to get to know you today, and thank you
Speaker 2: for being so honest. Thank you for being so open
Speaker 2: and vulnerable. And even though you describe yourself as stoic
Speaker 2: at the start, I definitely feel you shared. You shared
Speaker 2: a lot of emotion and what you shared, so thank
Speaker 2: you so much for doing that. I really appreciate it.
Speaker 1: Thank you for taking the time, you know, it's been
Speaker 1: It's been a lot of fun. Yeah. I don't usually
Speaker 1: do uh, I don't do too many podcasts in general,
Speaker 1: but this was a unique experience.
Speaker 2: Yeah, I'm very grateful, grateful for your time. Thank you
Speaker 2: so much. Wise, thank you, thank you so much for
Speaker 2: listening to this conversation. If you enjoyed it, you'll love
Speaker 2: my chat with Adam Grant on why discomfort is the
Speaker 2: key to growth and the strategies for unlocking your hidden potential.
Speaker 2: If you know, oh you want to be more and
Speaker 2: achieve more this year, go check it out right now.
Speaker 1: You set a goal today, you achieve it in six months,
Speaker 1: and then by the time it happens, it's almost a relief.
Speaker 1: There's no sense of meaning and purpose. You sort of
Speaker 1: expected it, and you would have been disappointed if it
Speaker 1: didn't happen.