Off Brand

The Winner of the Robinhood Backlash Is — Robinhood?

In recent weeks the stock trading app has been in reputational free fall. So why is it more popular than ever?

An illustration of a green Robin Hood cap (the bycocket) with the Robinhood company’s  feather logo placed four times along the cap.
An illustration of a green Robin Hood cap (the bycocket) with the Robinhood company’s  feather logo placed four times along the cap.
Illustration by Julia Moburg for Marker

One company’s misery is often another’s opportunity, and that certainly seems to be the story of Public, an under-the-radar stock-trading app that’s lately gotten hot in large part because it is not Robinhood. Just as the #DeleteUber moment boosted its rival Lyft, the Robinhood backlash that kicked in after the app temporarily halted trading in GameStop shares at the height of stonk-mania — resulting in one-star app store reviews, social media outrage, user vows to dump the app, etc. — has sent Public a flood of new customers, and fresh investor interest. But the ultimate winner of the Public vs. Robinhood faceoff may not be as obvious as you think.

Public is certainly leaning into the not-Robinhood opportunity. Most notably: One of the complaints against Robinhood is that it makes a chunk of its money by selling its “order flow” (basically, routing its customers’ trades through big Wall Street market-makers, a practice that can result in individual users getting less than the best possible price). Public sold its order flow, too — but on February 1, hot on the heels of Robinhood’s faceplant, the company announced that it would stop. Public also has a community component that the company insists is distinct from the hothouse atmosphere around other no-fee apps. “It’s not the trader bros,” co-CEO Leif Abraham told The Information.

This positioning seems to be paying off. User numbers are up. Today, TechCrunch reported that Public closed a $220 million investment round, led by investors including Greycroft, Accel, and Tiger Global Management, valuing the firm at $1.2 billion. That’s a pretty steep increase from December, when Public raised a reported $65 million at a $250 million valuation. It’s good to be not-Robinhood!

But what’s it like to be actual Robinhood right now? From one angle it looks awful. Apart from the review slams and the Twitter freakouts, CEO Vlad Tenev has been theatrically grilled by Elon Musk, roasted by the financial and tech press, and summoned to explain himself to a congressional committee this coming Thursday. Of course, there’s a class-action lawsuit, and at one point, a clutch of “irate” customers descended on Robinhood’s Menlo Park headquarters and “threw dog poop, vandalized a sculpture and held a protest,” according to The New York Post. Bloomberg says Tenev is staying in a hotel and “avoiding going home after receiving death threats.” So, that’s pretty bad.

On the other hand, even as its reviews plummeted, Robinhood downloads soared. Even as I type this on Tuesday, February 16, it’s in the top 15 of most popular free apps in the Google Play store and was at the №3 spot as recently as Monday. (To find Public, I had to narrow down to “finance” apps, where Robinhood was №1, and Public was 35th.) Apptopia data cited by Bloomberg shows Robinhood downloads outpacing all competitors throughout the GameStop fiasco.

Public’s rise to capture a bigger niche does not mean it’s about to destroy Robinhood. To the contrary, even in the midst of the GameStop madness, Robinhood was racking up a million downloads in one day.

Perhaps as a result, Robinhood’s backers do not appear to be losing faith. To the contrary, data from Rainmaker Securities cited by Quartz indicates that secondary market shares in Robinhood itself now value the company at a whopping $40 billion — double a December estimate and about three-and-a-half times its last funding round in September.

And of course, it puts Public’s not-Robinhood $1.2 billion valuation in a rather different light. To be sure, Robinhood’s stumble was a significant event for Public, raising its profile and bringing in new users: At the peak of the Robinhood controversy, it attracted 250,000 in a week, The Information reports. The decision to move away from payment for order flow — to be replaced with essentially a “tipping” scheme, asking users to chip in — is bold and gives the brand a distinct, more human identity.

But Public’s rise to capture a bigger niche does not mean it’s about to destroy Robinhood. To the contrary, even in the midst of the GameStop madness, Robinhood was racking up a million downloads in one day, and its total user base is reportedly around 20 million.

Why? Well, Robinhood deserves some credit here for simply making a product that lots of people evidently like. (Yes, that may be because of the very ease-of-use, quasi-gamified design that some of its critics find so dangerous.)

But part of the answer is also that it’s deceptively easy to overestimate the real effect of an apparent “backlash.” Angry customers make a lot of noise, and the press loves to wildly amplify whatever’s happening on social media for the simple reason that tweets and chat board comments are easily visible and seem like tangible evidence of a market-changing shift in actual consumer behavior.

Meanwhile, it’s very easy to underestimate how much the raw power of brand awareness can help even a controversial company. In this case, perhaps all the noise made newcomers — who a month ago couldn’t name any trading app but can now name exactly one — vaguely curious about this thing that people are supposedly using to get rich and take on Wall Street. So they download it and give it a whirl. After all, the market’s still going up, there’s still not much else to do, so why not? But nobody makes a TikTok about that.

Robinhood’s stumbles are real, and the company is going to have to execute better and explain its missteps more coherently if it wants to protect and extend its brand; Tenev in particular needs to improve — a lot. (And that means more than just surviving that congressional hearing.) If this doesn’t happen, the company could ultimately prove vulnerable to Public or any of a range of competitors from Webull to Charles Schwab to some fledgling startup that hasn’t made its name yet.

But for now, the evidence suggests that — against considerable odds and all common sense — the infamous app could emerge from this embarrassing stretch somehow in better shape than ever. In fact, it may turn out that the biggest winner in the Robinhood backlash is Robinhood.

Author The Art of Noticing. Related newsletter at

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