Gurley predicts retail investors will access IPOs on Robinhood instead of gatekeepers hand-allocating underpriced stock.
“In the future, you'll be able to go on Robinhood, if you wanna participate in IPO, you can. And then let's not let these intermediaries and gatekeepers hand allocate who gets this underpriced stock.”
Gurley argues Robinhood is glorifying speculation rather than democratizing investing.
“And so what what Robinhood's really doing, I think, is kinda glorifying speculation. They're not they're not democratizing investing.”
Gurley explains Robinhood doesn't route orders to exchanges but sells them to six companies who are their real customers.
“They sell that order to six different companies that they work with who are really their customers.”
Gurley states 64% of Robinhood revenue comes from options trading despite democratization claims.
“it's now known that 64% of their revenue comes from options trading. And so the company wants you to believe and and goes on public television and claims that their mission is to democratize investing.”
Gurley says over half of Robinhood's revenue comes from payment for order flow for options, which history shows loses money.
“Over half of the revenue that Robinhood has reported is payment for order flow for options.”
Gurley states Robinhood makes 4x more revenue per options trade than stock trade via order flow.
“they make about 4x the amount of revenue on a option trade than they do a stock trade. Why do I bring this up? Know, Deutsche Kline and options trading like they talk,”
Gurley says Robinhood makes 4x more revenue on options trades than stock trades despite democratization claims
“they make about 4x the amount of revenue on a option trade than they do a stock trade. Why do I bring this up?”