> Headlines like Robinhood Gets Almost Half Its Revenue in Controversial Bargain With High-Speed Traders are virtually meaningless, as the above discussion of other monetization options should make clear. At scale, once their userbase actually has material cash in their accounts on any given day, they’ll likely make net interest, but pre-scale they may not even have the treasury function to do the work required to earn it safely. It’s a commentary on how low their revenue is (growth-stage startup optimizing for reach over revenue, film at 11), not a commentary on how beholden they are to Wall Street.
> Headlines like Robinhood Gets Almost Half Its Revenue in Controversial Bargain With High-Speed Traders are virtually meaningless, as the above discussion of other monetization options should make clear. At scale, once their userbase actually has material cash in their accounts on any given day, they’ll likely make net interest, but pre-scale they may not even have the treasury function to do the work required to earn it safely. It’s a commentary on how low their revenue is (growth-stage startup optimizing for reach over revenue, film at 11), not a commentary on how beholden they are to Wall Street.
https://www.kalzumeus.com/2019/6/26/how-brokerages-make-mone...