Investing is a great method for making some extra cash off of your savings that’s sitting in your bank earning less than a percent of interest. College students and many others are very intimidated to get in the stock game because they think it’s not worth the risk, difficult to start investing and they believe they may have to pay 100’s of dollars in broker fees. However, the creation of Robinhood has helped diminish all of these myths and creates and easy way to invest without paying any fees. My brother introduced me to this app a year ago and I have loved using it.
The application even offers a free stock to you and a friend for anyone you get to join. This is a great incentive and an ingenious way to gain users. Robinhood started in 2013 after founders Vlad Tenev and Baiju Bhatt pitched the idea to over 75 different investors. Since then, the app has grown to 2 million users and valued at $1.3 Billion. Tenev and Bhatt started in the industry with the company called Chronos Research that offered tools to hedge funds and banks to build automated trading strategies.
The move from the crazy stock broker firms to more digital data centers and the increase of mobile phones sparked the idea. The two co-founders even had 1 million people signed up before the app was launched. They created a website that stated “Commission-free trading” and allowed users to get on an email list. The website was able to get on Hacker News overnight which spiked its publicity and made the idea go viral. The application was finally released in 2015 and has since grown exponentially. They have even introduced a gold version that offers additional features for a cost. This application is perfect for millennials and is even used mainly by people under the age of 30. The design is perfect and makes it extremely easy to invest in not just one stock, but multiple at absolutely no cost. Robinhood allows the younger generation to create diversified portfolios and become more attentive to the market.
You might be wondering how they make money. Robinhood makes money by collecting interest on your funds that are in your Robinhood account, but not invested. They also offer a gold version that costs $6 a month. The gold version allows you to get up to 2x your buying power and gives you access to after-hours trading.
The application is perfect for anyone trying to potentially make a little extra cash and anyone looking to start increasing their knowledge of the market. I find myself spending more time in the news, reading articles and doing research to gain knowledge on where to invest. The application also speeds up the process of investing in stocks. It takes less than a minute and only a few clicks. Robinhood is available on any mobile platform and is definitely worth checking out.