Legendary investor Bill Gurley rejected Robinhood's pitch because it made him feel 'emotionally bad' and he thought the app mislead users
Bill Gurleydid not invest in Robinhoodbecause it made him feel "emotionally bad."
- Gurley told The New Yorker he thought the commission-free trading app was "misleading to people."
- Gurley has called to ban payment for order flow, a model Robinhood relies on to make money.
Venture capitalist Bill Gurley reportedly did not invest in Robinhood because it made him feel "emotionally bad."
Gurley, a general partner at Benchmark who has invested in Uber, Zillow, and Stitch Fix, told The New Yorker's Sheelah Kolhatkar he did not invest in Robinhood because of oppositions to the app's business model. Robinhood gets money by using a third party to carry out individual buy or sell orders, called a "payment for order flow."
"It made me feel bad. Emotionally bad. Because I think it is misleading to people." Gurley told The New Yorker. "My issue with Robinhood is, I think their mission and what they say they stand for is not actually true."
Robinhood is a commission-free trading app popular among first-time investors. The firm's website said it's aim is to "democratize
But the app has high profile critics like Warren Buffett and Charlie Munger, and some markets experts recently told Insider the app "gamifies" trading through flashy animation and incentivizes risky betting.
Gurley called for the US Securities and Exchange Commission to ban payment for order flow models during the height of GameStop's short squeeze. In early 2021, many retail investors, including those in the Reddit group WallStreetBets, pushed the price of GameStop up. Some said it was to burn hedge funds that bet against the stock.
Gurley, in the past, has said the payment for order flow practice "smells bad" and is already outlawed in the UK and Canada.
"If the SEC/government wants to "fix the plumbing" the number one thing they should do is ban Payment for Order Flow," Gurley tweeted in January.
Gurley gained fame through backing Uber in 2011 with $10 million, which brought Benchmark $8 billion. Gurley did not participate in Benchmark's latest fund, but will remain at the
- Sansera Engineering IPO — How to check allotment status, listing date and more
- The collapse of Evergrande, one of China’s largest home developers, is “not a Lehman moment” but the fear may haunt steel and metal stocks in India
- Amazon is investigating its lawyers for allegedly bribing Indian government officials
- Thums Up's latest ad celebrates the grit and determination of Indian fast bowler Mohammad Siraj
- This brand is airing ads made on PPT during IPL to convey the importance of saving money
- Srei Group may leave a $4 billion hole in some of India’s biggest banks
- Buying support pushes equities higher; ONGC, UPL, Bajaj Finance, JSW Steel rise
- Air Canada, Emirates, Air India and other airlines resume flights to Toronto and the tickets are priced up to ₹5 lakh