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Robinhood’s Addictive App Made Trading a Pandemic Pastime

Now the platform has to make money from its devoted fans.

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Will Sartain

Will Sartain

Photographer: Andrew Spear for Bloomberg Businessweek

On March 2, just before offices shuttered across the U.S., the staff at Robinhood Markets Inc. worked long after sunset in their Menlo Park, Calif., headquarters. Executives huddled around co-founder Vlad Tenev, then disbanded to bring orders back to their teams. The company faced an emergency: A systemwide outage had disabled its online trading app throughout one of the stock market’s busiest days in months.

Spooked by the early spread of Covid-19, U.S. stocks had gone through a harrowing sell-off and then surged back. Robinhood’s malfunction consigned its customers to the sidelines while more than 14 billion shares of U.S. equities changed hands. Although Robinhood managed to restore the app’s service, its handling of the episode angered customers and drew an inquiry from the U.S. Securities and Exchange Commission, Bloomberg reported in August. (Both the regulator and Robinhood declined to comment on any investigations.)