Robinhood’s pain is Public’s gain as VCs rush to give it more money



Public.com, a social-focused free stock trading service, is nearing the close of a Series D just two months after raising a $65 million Series C, sources familiar with the matter told TechCrunch.

The San Francisco-based fintech aims to give people the ability to invest in companies using any amount of money, with a focus on community activity over active trading. It competes with Robinhood, M1 Finance and other American fintech companies that offer consumers a way to invest in equities with low or zero fees.

Public.com apparently got a flurry of investor interest over the past couple of weeks after Robinhood found itself in hot water and essentially raised $3.4 billion in a matter of days to help get itself out of a mess. 

That new capital came at a challenging time for the unicorn, which could pursue an IPO this year. And some investors reportedly want a piece of rival Public.com’s pie.

One source told TechCrunch that many of those offering term sheets believe there could be “a mass exodus from Robinhood” and want a way to capture that value.

Public recently shook up its business model, moving from generating revenue from order flow payments, a key way that Robinhood monetizes, to collecting tips from users in exchange for executing their orders. Payment for order flow, or PFOF, has become a touchstone in the debate surrounding low-cost trading platforms, and how users may pay for their (Read more...)