The New American Dream: Democratising Investing

Robinhood was founded in 2013 on three structural advantages: commission-free trading at a time when competitors charged 7 to 10 dollars per transaction and required minimums of 1,000 to 2,000 dollars, a mobile-first design philosophy, and a founding mission shaped by the 2008 financial crisis. Co-founder and CEO Vlad Tenev, who arrived in the United States from Bulgaria in 1992, graduated into a post-Lehman world and shared the perception that crisis costs were socialized while the recovery benefited insiders. The company IPO'd in July 2021 at a 32 billion dollar market cap, fell 80 percent to 6 billion dollars during the 2022 pullback, and has since recovered to approximately 90 billion dollars with 380 billion dollars of assets on the platform.

US equity market participation rose from roughly 20 percent to around 50 percent with the spread of 401k plans, and Robinhood helped push that figure to approximately 65 percent today. Tenev believes participation could eventually reach 90 percent or above. Robinhood is the sole initial broker and trustee for the Trump accounts program, backed by BNY Mellon, which gives every newborn child a brokerage account invested in a diversified group of companies from birth. In the UK, only roughly one in six people have equity exposure, major full-service brokers have not gone commission-free, and a 2024 Gambling Commission report found over 50 percent of the UK population placed a bet in a single year. Tenev views commission-free models as inevitable in the UK and has stated an aspiration for Robinhood to become one of the largest employers there, having already launched a UK ISA product with a 2 percent match.

The customer base has shifted materially since the early years. The January 2021 meme stock rally, which included GameStop, airlines, and rental car companies, arrived a couple of weeks after a large stimulus payment, and Robinhood data showed capital being deployed into markets within days of those payments arriving. Three COVID-era tailwinds amplified the activity: fewer places to spend money, more time at home, and zero interest rates combined with stimulus. Tenev says customers today are by and large investing in large companies with genuine earnings power such as SpaceX, Nvidia, and Tesla.

Tenev argues retail investors behaved more resiliently than institutional investors during the tariff-driven volatility of 2025. He contends institutional money can be too smart in a negative way, selling companies like Palantir for macro reasons even when those companies may be unaffected or positively affected by tariffs. Retail investors, he says, tend to focus on whether an individual company is doing well rather than reallocating based on macro events, and he credits them with examining revenues, profit margins, and rule of 40 metrics.

The core problem Tenev identifies is that the most significant wealth creation now happens before companies reach public markets. SpaceX, OpenAI, and Anthropic are either going public at trillion-dollar valuations or are expected to, meaning the 1000x or 10000x returns that retail investors once captured in public markets with companies like Microsoft or Amazon are increasingly accruing only to wealthy insiders. He acknowledges that even if efforts to push companies toward earlier public listings succeed, those firms may still debut at trillion-dollar valuations because raising private capital will continue to get easier, which is why he describes democratizing access to private markets as Robinhood's next major mission. Robinhood Ventures Fund 1 has invested in Stripe, OpenAI, SpaceX, and Revolut, structured as a closed-end publicly traded fund. Tenev believes seed and Series A rounds should eventually be made safely available to retail investors and says every company in Robinhood Ventures has been enthusiastic about having retail investors involved early.

Robinhood has built a layer two blockchain called Robinhood Chain on top of Ethereum using Arbitrum technology, covering 2,000 US-listed equities as stock tokens available in over 120 countries and tradable 24 hours a day seven days a week. Tenev states the tokens are backed one-to-one by the underlying asset and that customer exposure is protected even if something were to happen to Robinhood, because the tokens are portable and transferable independent of any individual broker as long as the blockchain operates. The strategic logic mirrors stablecoins spreading access to US dollars, with tokenization intended to spread access to US equities globally.

Tenev recently rolled out agentic trading and an agentic credit card product and predicts the brokerage firm that harnesses AI correctly will take meaningful additional market share over the next five years. He rejects the premise that massive scale is required to compete in AI, citing small startups and referencing DeepSeek's reported training of a frontier-quality model for approximately six million dollars, though he acknowledges that figure may have been overstated. He argues Robinhood does not need to conduct its own pre-training and believes doing post-training and reinforcement learning in-house can cut costs significantly while still delivering competitive performance. On market efficiency, Tenev argues universal AI adoption would not make markets perfectly efficient because if every retail trader used the same agent the incremental value of that agent would decrease, reopening opportunity for human traders. He frames the traditional American dream as defined by home ownership but views real estate as a poor sole investment due to illiquidity, high transaction costs, and excessive leverage, positioning broad equity and private market ownership as the replacement.