Illustrations: Shira Inbar

How Robinhood Convinced Millennials to Trade Their Way Through a Pandemic

The $8.3 billion stock trading startup fumbled into the financial crisis — and is now winning it

Rob Walker
Published in
15 min readJun 1, 2020


If there was a day everything changed for stock traders, it was Monday, March 2. The prior week, a Centers for Disease Control official warned that as the coronavirus pandemic sweeping Asia and Europe spread in the U.S., “disruption to everyday life may be severe.” China reported 202 new Covid-19 cases, bringing the total there to more than 80,000 despite massive lockdowns. Hundreds of new cases were confirmed in Italy; deaths were reported from Australia to South Korea; and cases in the U.S. tipped past 100. The S&P 500 had fallen for five straight days, plunging nearly 10% on spiking volume. For anyone working the markets, this would be the day to be ready for action.

Yet somehow it was a disastrous day for Robinhood. The markets rallied, but Robinhood — the no-fee trading app known for its young user base and unicorn-level valuation — did not. The service suffered an outage that lasted not an hour, not a couple of hours, but the entire trading day. “I definitely won’t be using Robinhood anymore,” one among many outraged users vowed to CNBC. “When they reopen I’m moving all of my funds.” Others even sued. For a company that just weeks earlier seemed a hot IPO candidate, it looked like a turning point. “Until this week,” the New York Times wrote, in obituary-like tones, the company “had been regarded as one of the most successful financial technology startups.”

The pessimism was understandable. There was always a whiff of the bull market phenomenon around Robinhood: The Stanford-pedigreed founders who talked of “democratizing” Wall Street, and the $7.8 billion valuation clearly yoked to growth over proof of profit. How much demand would there really be for a stock-trading app in an economic storm wiping out years of soaring stock prices? Especially if that app conked out when the markets were volatile — a seemingly mission-critical failure.

The service suffered an outage that lasted not an hour, not a couple of hours, but the entire trading day.