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A Modern “Robinhood”, Vlad Tenev is On a Mission to Democratize America’s Financial System

“Be skeptical of experts — Many of the right decisions we made ended up being ones that industry experts thought were foolish at the time, including naming the company Robinhood, having no account minimums, and focusing on mobile. When industry veterans and experts are flabbergasted about something you want to do, it’s a good time to pay attention; you may be on the right track.”

I had the pleasure of interviewing Vlad Tenev, co-founder and co-CEO of Robinhood, a Palo Alto-based company on a mission to democratize America’s financial system. Robinhood lets you open an account for free and invest in the stock market without paying trading fees. Vlad’s been named one of Fast Company’s “Most Creative People in Business”, Forbes’ “30 Under 30”, Business Insider’s “Silicon Valley 100”, and Inc.’s “30 Under 30”, and Robinhood has been awarded with the Apple Design Award, Google Material Design Award, named CNBC’s “Disruptor 50”, the 11th “Most Innovative Company in the World” by Fast Company, and more. The company is valued at $1.3 billion and touts investors such as Yuri Milner’s DST Global, NEA, Index Ventures, Snoop Dogg, Jared Leto, Ashton Kutcher, and John Legend.

Yitzi: Thank you so much for doing this with us! What is your “backstory”?

I was born in Bulgaria during Communist times. After the Berlin Wall fell and the Communist party collapsed, my dad was fortunate to get an opportunity to come to the U.S. and study at the University of Delaware in early 1991. My mom followed him about a year later, and I flew out to join them about 6 months after that. My family was very academically oriented — my mom and dad both got advanced degrees, and I was really interested in math and science as a kid. I grew up in Virginia and moved to the Bay Area in 2004 to attend Stanford, where my co-founder Baiju and I met as fellow physics majors.

We graduated from Stanford right around the time Lehman Brothers went under. It was a huge turning point for us and for the financial system. We moved to New York to build trading platforms for hedge funds and banks. Over the next few years, we became more sensitive to the growing wealth gap in the United States, and didn’t like that we were essentially making the ultra rich richer. So we moved back to California and set out to create Robinhood, so more people could participate in the market without being ripped off by pointless fees and account minimums.

Today, Robinhood is the fastest-growing brokerage with over 2M users and over $75B in transaction volume.

Yitzi: Can you share the funniest or most interesting story that happened to you since you began leading your company?

One great story that comes to mind is from December 2013. It was Friday night, and our ten person team was working hard prepping our website for our public announcement the following week. We had our press embargo all lined up, and we were in the home-stretch, so we decided to push our website live, thinking no one would notice.

I woke up early that Saturday and decide to check Google Analytics. When I loaded the page, I was shocked to see over 500 simultaneous visitors to our website! At first I thought it was a reporting error because the furthest thing from my mind was that our website could go viral. We had tried in the past to make things go viral many times and failed miserably.

However, I dug deeper and found out that we were #3 on Hacker News, right behind the Chinese landing a spaceship on the moon and Google acquiring Boston Dynamics. Thirty minutes later, we climbed to #1. Someone randomly discovered our website and posted the link on Hacker News and the traffic picked up from there. Everyone rushed to the office to wire up our emails and fix broken things on the site, as we had inadvertently launched on a Saturday!

Yitzi: So what exactly does your company do?

Robinhood makes stock trading easy and accessible to everyone. While most brokerages charge trading fees (up to $10) per trade, Robinhood is completely free. While in New York, we learned that everything’s been automated — paying to trade is like paying to send an email. It’s all electronic nowadays. Later, we will expand to other financial services and make them faster, cheaper, and offer them with a better user experience.

Yitzi: How have you used your success to bring goodness to the world?

I’m a strong believer that everyone should have access to their own financial system. In the United States, less than half of American adults are invested in the US stock market, which is a huge shame given the stock market is an incredible wealth engine. For decades, people have been discouraged from investing, distrustful of Wall Street, and in some cases, blocked out from even opening an account due to high fees and account minimums.

For Robinhood, the end goal isn’t about becoming another brokerage, but about creating a world where everyone can take advantage of the most lucrative form of wealth creation.

Yitzi: What are your “5 Things I Wish Someone Told Me Before I Became CEO” and why.

  1. Be skeptical of experts — Many of the right decisions we made ended up being ones that industry experts thought were foolish at the time, including naming the company Robinhood, having no account minimums, and focusing on mobile. When industry veterans and experts are flabbergasted about something you want to do, it’s a good time to pay attention; you may be on the right track.
  2. Write down everything — All the way from goals and important decisions down to thoughts that you have throughout the day. There are many benefits to this that were not clear to me early on. First, writing down goals helps you achieve them by focusing your mind on what’s most important. I usually start my day by writing down my #1 goal fifteen times on a piece of paper. Secondly, over time it becomes harder and harder to communicate with everyone on your team face-to-face, and you’ll rely more on written communication, so it pays off to get really good at it. Lastly, you’ll wish you had a record of events, stories, and key decisions you made over time; these stories are fun and also important teaching events for new team members.
  3. Avoid mixers and conferences — Ignore if you work at a B2B company and your customers are at these conferences. I see a lot of entrepreneurs get wrapped up in the noise and start attending conferences, exclusive dinners, and fancy mixers. Having industry pundits and thought leaders think your company is cool isn’t going to help you; focus on the business!
  4. Don’t focus too much on success itself — Focus on building habits and skills for deliberate and continuous self-improvement. For example, rather than setting a goal to run a sub 5-minute mile, try running 30 minutes every single day. Having an aggressive goal can be daunting and demotivating, but a process to follow that gets you closer every day is the opposite — easily achievable and rewarding.
  5. Control the downside — I think a lot of people focus on the best case outcome of a particular deal or decision. I think about all the ways it can fall apart, and making sure we come out unscathed. I like to be positively surprised by the upside.

Yitzi: I have been blessed with the opportunity to interview and be in touch with some of the biggest names in Business, VC funding, Sports, and Entertainment. Is there a person in the world, or in the US whom you would love to have a private breakfast or lunch with, and why? He or she might see this, or I might be able to introduce you.

Tony Robbins. I’m fascinated by his ability to inspire people on a massive scale and how he has evolved himself and his brand over the past 30 years.