Robinhood's defining moves.
The defining strategic moves at Robinhood — each one explained and grounded in the record.
The Loss Leader · Business Model
Robinhood's Free Trading Wasn't a Gift. It Was the Bait on a Hook It Couldn't Always Hold.
On January 28, 2021, Robinhood got a $3 billion collateral demand at 5:11 a.m. and stopped its customers from buying GameStop hours later. It looked like a hedge-fund conspiracy. It was something more revealing: the loss-leader model finally showing whose side it was on.
8 min
The Loss Leader · Business Model
Robinhood's Trades Are Free Because You Aren't the Customer. You're the Inventory.
Everyone thinks Robinhood gives away trades and makes it back on payment for order flow. Half right. PFOF monetizes your orders; net interest income — $1.1 billion in 2024 — monetizes the cash and stock those free trades park on its books.
8 min
The Crisis Response · Crisis Response
Robinhood Didn't Conspire to Halt GameStop. It Ran Out of Money.
On January 28, 2021, a clearinghouse demanded $3.7 billion from Robinhood by mid-morning. The buy button vanished. Everyone screamed conspiracy. The boring truth - a settlement bill it was never capitalized to pay - is worse.
8 min