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Speaker 1: Bloomberg Audio Studios, podcasts, radio news.

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Speaker 2: Big news today for a good friends of robin Hood markets.

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Speaker 2: Stock's up three point six percent today. The company unveiling

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Speaker 2: a credit card. I need more credit cards.

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Speaker 3: Look at the stock here. Obviously, I'm a Wall Street guy.

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Speaker 3: All I care about is the stock.

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Speaker 2: Stock's a fifty six percent year to date, wow, trailing

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Speaker 2: twelve months, up one hundred and thirty two Percent's got

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Speaker 2: a seventeen and a half billion dollar market cap. So

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Speaker 2: big news coming out of our friends of Robinhood. Lat

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Speaker 2: Tenant joins us. He's the chief executive officer. He's a

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Speaker 2: co founder of Robinhood. He joins us here in a

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Speaker 2: Bloomberg Interactive broker studio. I'm not on the robin Hood

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Speaker 2: platform because I'm a gentleman.

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Speaker 3: I need the.

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Speaker 2: Swiss bank secrecy laws protecting me. But my twenty eight

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Speaker 2: year old twins, who are the future of this thing,

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Speaker 2: they are on Robinhood.

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Speaker 3: They're very happy.

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Speaker 2: They were psyched that I was talking to Vlad. Vlad,

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Speaker 2: talk to us about your news today. You're not just

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Speaker 2: a commission free platform, which is in and of itself amazing,

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Speaker 2: but you're now getting to the credit card business.

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Speaker 1: Yeah, we're really excited to announce this. We've been working

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Speaker 1: on it for quite a while and we didn't just

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Speaker 1: want to launch another me too credit card. We really

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Speaker 1: wanted to come in and do something special and really

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Speaker 1: lead the industry. So it's really the best cash back

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Speaker 1: rewards that we found in any credit card on the market,

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Speaker 1: the best digital experience, and really the best design. We

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Speaker 1: have a solid gold card that's basically a hunk of metal.

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Speaker 1: It's extremely iconic, very simple, like, very well designed. We're

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Speaker 1: really proud of the product. Now the hard work comes

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Speaker 1: of rolling it out. But even since the announcement, in

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Speaker 1: the first few hours after the announcement, which was last night,

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Speaker 1: we had hundreds of thousands of people signing up for

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Speaker 1: the credit card, so it's it's looking very good so far.

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Speaker 4: How does the credit card fit into the business, because

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Speaker 4: I know early last year you guys announced a retirement products,

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Speaker 4: so it feels like you're trying to expand away from

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Speaker 4: the core trading platform.

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Speaker 1: Yeah. So as a business, holistically, we're focused on three things.

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Speaker 1: The first is being the number one platform for active traders.

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Speaker 1: Right now we're number two, but we have a path

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Speaker 1: to being number one in some number of years, and

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Speaker 1: that's really through user experience improvements, product innovations like twenty

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Speaker 1: four hour market, adding new asset classes like futures, new

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Speaker 1: platform launches like our web Pro platform which we've announced.

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Speaker 1: But we don't want to just be an active trader platform.

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Speaker 1: We also want to grow wallet share with our customers

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Speaker 1: and help them build wealth. That's where Robinhood Gold comes in.

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Speaker 1: That's where our innovations and the retirement program with three

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Speaker 1: percent match come in. And of course, now the credit

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Speaker 1: card is sort of another pillar of us growing wallets

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Speaker 1: share with customers and helping them do all of their

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Speaker 1: financial activities in one place via Robinhood.

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Speaker 2: So are you competing with this card with the bank

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Speaker 2: issued Visa master cards?

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Speaker 3: Is that the market you're now going into.

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Speaker 1: I think that we're trying to do something really interesting

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Speaker 1: with this card. So if you think about premium credit cards,

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Speaker 1: the best ones out there, accept less than half of

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Speaker 1: the people that apply.

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Speaker 3: Is that right half of that would chase Sephi or

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Speaker 3: is that an Platinum or whatever?

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Speaker 1: Those classes of credit card, it's really like the typical

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Speaker 1: sort of like super prime premium rewards cards and they

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Speaker 1: have high annual fees. So what we wanted to do

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Speaker 1: is in the same way that Robinhood democratized stock trading

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Speaker 1: and made it accessible to a wider group of people,

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Speaker 1: we want to open up the private client experience. I

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Speaker 1: don't know if you've been to a Chase branch, but

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Speaker 1: you can see there's two doors, one for the private

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Speaker 1: clients and one for everyone else. And the whole idea

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Speaker 1: behind Robinhood Gold is giving that private client experience for

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Speaker 1: as little as five dollars a month, opening it to everyone.

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Speaker 1: And it starts with the premium credit card. Of course,

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Speaker 1: the retirement benefits where you get a three percent match,

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Speaker 1: the first and biggest in the industry, the five percent

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Speaker 1: apy on our cash which is just the institutional grade,

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Speaker 1: high yield offering that you have to have, you know,

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Speaker 1: millions of dollars to match at other brokers. So yeah,

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Speaker 1: we're putting all this together and we're seeing Robinhood Gold

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Speaker 1: customers actually depositing the lion's share of their money into

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Speaker 1: Robinhood and really growing with us. And I think we

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Speaker 1: have an opportunity to offer them services for all their

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Speaker 1: financial needs by the.

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Speaker 4: Perks Aretty Sweet as you mentioned, three percent cash back

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Speaker 4: on all purchases do you make money off of this?

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Speaker 3: How are you?

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Speaker 4: How is this going to be kind of another peg

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Speaker 4: for the profitability and the growth of the company.

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Speaker 1: Yeah, two things there. One is we do obviously any

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Speaker 1: business line we enter, we intend to be profitable over

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Speaker 1: the long run on a standalone basis, So not just

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Speaker 1: a creative but we anticipate this being a profitable business

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Speaker 1: line just within the card portfolio. And that's through not

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Speaker 1: just the interchange transaction revenue, but also the lending business

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Speaker 1: through the card. We anticipate this wo'd actually be a

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Speaker 1: very attractive card for people building credit over time, and

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Speaker 1: not just folks that pay off their balance in full.

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Speaker 1: And then the other side of it is we see

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Speaker 1: that when customers adopt Robinhood Gold, their rate of deposit

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Speaker 1: growth and account balance growth is much higher than non

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Speaker 1: gold customers. They also adopt our products at a much

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Speaker 1: higher rate, and so even though they're getting so much

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Speaker 1: more value with all these industry leading rates and value props,

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Speaker 1: the revenue that accrues to the business from the gold

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Speaker 1: relationship is also multiples higher than non gold customers. And

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Speaker 1: we think the credit card, since it's so core to

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Speaker 1: people's financial needs, typically all of their The line's share

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Speaker 1: of their spending goes through credit and if you're using

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Speaker 1: a credit card, much easier to grab the paycheck deposit.

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Speaker 3: Carries cash around.

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Speaker 4: This is the guy who walks around with hundreds of

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Speaker 4: dollars in his pocket.

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Speaker 2: I don't know why, I asked myself the same when

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Speaker 2: you walk into a bar, the jersey short good cash

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Speaker 2: on the bar there.

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Speaker 1: Well, I mean, I'll show you what I've got in

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Speaker 1: my pocket.

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Speaker 3: He brought the cards very cool fourteen.

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Speaker 2: So this all right focused on we're shoving it. This card,

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Speaker 2: it is it weighs something. You got some hef to.

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Speaker 3: Well, this is the card here, folks. It is.

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Speaker 1: It's basically a gold booleon. It's like a it's not

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Speaker 1: gold plated, it's a this.

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Speaker 3: Is legit solid your numbers though I can't make it. Well,

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Speaker 3: so that is right now.

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Speaker 1: That's the great thing about it because this is a

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Speaker 1: digital first card, and we outlined all the awesome digital

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Speaker 1: features like virtual cards, like family focused suite of features. Yeah,

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Speaker 1: you don't actually need the number on it. You can

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Speaker 1: open up the app look at the number, the expiration

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Speaker 1: dates on there. The design of the card is minimal.

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Speaker 1: Only the Robin Hood brand the chip and on the

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Speaker 1: back you have your name and that's pretty much interesting.

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Speaker 1: So if it gets roll in or lost, you don't

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Speaker 1: really have to worry about their actual number being used.

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Speaker 2: Yeah yeah, all right, So who is the typical Robinhood

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Speaker 2: customer these days?

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Speaker 3: Client?

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Speaker 1: These days, a typical Robinhood customer, I would say, is

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Speaker 1: someone in their thirties. They tend to be an early

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Speaker 1: adopter of technology. They have, you know, more, half of

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Speaker 1: our customers make over one hundred thousand dollars in annual income,

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Speaker 1: so it's not sort of like the paycheck to paycheck

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Speaker 1: customer as maybe some people think. And we also have

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Speaker 1: much larger customers with big accounts. We recently have been

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Speaker 1: introducing matches. In fact, last night we rolled out another initiative,

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Speaker 1: one percent unlimited deposit match into Robinhood for all dollars

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Speaker 1: deposited for our Gold members. So basically, most financial firms

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Speaker 1: charge you a percentage to keep your money there as

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Speaker 1: a management fee. We're paying you a percentage to move

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Speaker 1: your money with us. And these types of offers have

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Speaker 1: really attracted people with much bigger accounts. We've had customers

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Speaker 1: with tens of millions of dollars. Moving those accounts to

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Speaker 1: Robinhood and they've been very happy with the experience. So

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Speaker 1: we have been adding capabilities to serve customers across the

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Speaker 1: entire market, not just sort of in that middle tier,

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Speaker 1: but also people with more money and people with less

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Speaker 1: who are just getting started. We also would like to

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Speaker 1: serve them and have been focusing on that demographic since

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Speaker 1: day one in VLAT.

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Speaker 4: When I talk to skeptics, they point out that you

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Speaker 4: guys are heavily reliant on options, trading crypto volumes, and

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Speaker 4: that driving the business. Paul mentioned their huge run up

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Speaker 4: over the last twelve months, still down.

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Speaker 3: Forty eight percent from the IPO price.

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Speaker 4: What is the kind of mission in the next coming

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Speaker 4: months and years for the company to get back to

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Speaker 4: that IPO price and trade higher.

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Speaker 1: Well, I think we've been doing really well focusing on

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Speaker 1: the inputs of the business. I can't really control the

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Speaker 1: stock price directly, but if we're growing revenues, if we're

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Speaker 1: diversifying revenues, if we're launching innovative new products for our customers,

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Speaker 1: I think we can kind of grow through market headwinds

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Speaker 1: and high interest rate environment and be sort of like

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Speaker 1: a company that thrives in all conditions, and you mentioned

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Speaker 1: the revenues and options trading and all these things. But

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Speaker 1: what's happened in the past couple of years is the

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Speaker 1: revenue profile of the business has diversified as we've rolled

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Speaker 1: out all these products. As of the last earnings report

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Speaker 1: several earnings calls, more than half of the revenues actually

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Speaker 1: net interest margin, not even transaction base. So as we

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Speaker 1: add more of these products, like the five percent yield

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Speaker 1: on your cash, the profile of the business has also changed.

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Speaker 3: All right, Glad, thank you so much for joining us.

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Speaker 2: Really appreciate you coming into our Bloomberg and director broker

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Speaker 2: studio of lad Tenev. He's a chief executive officer, co

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Speaker 2: founder of Robinhood. The news today Robinhood unveils a credit

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Speaker 2: card and folks, it has some half.

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Speaker 3: This is a unique credit card.

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Speaker 2: It's in a further push beyond the trading business there

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Speaker 2: and the stock performing very well there.

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Speaker 3: We appreciate that