Robinhood CEO Vlad Tenev is aware of that the corporate’s title is considerably controversial — however that is a part of the purpose.
Tenev mentioned in an episode of “The Logan Bartlett Present” posted on Friday that he wished the title to be disruptive and go in opposition to the standard norm of different monetary firms.
The CEO mentioned the origin of the title comes from when the corporate was simply beginning and he was courting his now-wife. On the time, when she launched him to her pals and mentioned he labored in finance, there can be “a little bit little bit of a groan,” Tenev mentioned.
“They thought I used to be some sort of funding banker or enterprise capitalist,” Tenev mentioned.
Tenev’s spouse would counter the response by saying he was the “Robinhood of finance” and “attempting to assist the little man.”
Tenev mentioned that he appreciated the sound of that.
“Our ideas have been that if the title elicited robust reactions, even when they weren’t all constructive, a minimum of it might be memorable and that might be higher than sort of a reputation that everybody was okay with,” he mentioned.
Whereas Tenev and fellow cofounder Baiju Bhatt each liked the idea, the corporate had about 10 workers on the time and reactions have been break up, Tenev mentioned. Half of the corporate liked the title and the opposite half hated it.
With many monetary companies firms serving a base of wealthier individuals, there was a worry that the title would scare off these clients, Tenev mentioned.
In the end, they determined to go along with Robinhood, and it is change into an enormous a part of the model and its messaging, Tenev mentioned. However years later, he wonders if the corporate would have acquired much less criticism if it had gone with a distinct title.
“If we named the corporate Omaha, would Warren Buffett be criticizing it as aggressively?” Tenev mentioned, referring to the billionaire’s birthplace. “As a result of he, , he cannot criticize Omaha. I believe we might’ve prevented that.”
Billionaire Warren Buffet and his longtime enterprise accomplice Charlie Munger, who died final yr, each vocally criticized the corporate, accusing it of treating the inventory market like a on line casino and inspiring short-term buying and selling.
Tenev additionally mentioned that there is additionally been some backlash of the model’s message, like with the meme inventory scenario a couple of years in the past.
The meme inventory buying and selling frenzy in 2021 concerned a wave of latest and inexperienced traders to the funding platform, all for particular shares like GameStop and AMC Leisure. Following the surge, Robinhood confronted criticism for limiting buying and selling on sure meme shares through the peak of that interval.
However general, Tenev mentioned it is tried to be constant from the start about its messaging and separating itself from different monetary firms — and in the event that they selected a reputation that was extra constructive, perhaps it would not have been as memorable.
