Public, a would-be Robinhood rival, raises $65 million
The year 2020 has been tough for many companies, but it’s been a fantastic one for brokerages. Buoyed by a record number of new retail investors, firms like Robinhood and Fidelity have experienced record levels of trading.
This trading surge, along with the popularity of newer app-based platforms like Robinhood, has created a potential opportunity for upstarts. These include Public, a New York-based startup whose investing platform seeks to blend social media and investing.
In practice, this means users can tell each other what stocks they buy and, in some cases, see what high profile celebrities or investors are buying. The company has recruited prominent figures of pop culture, including skateboarder Tony Hawk and Alex Pall of the band The Chainsmokers, to help drum up interest in the platform.
Hawk and Pall are also among those who’ve invested in Public’s new Series C financing round of $65 million. The round, which was led by the venture firm Accel, brings Public’s total funding to $90 million since it launched in 2018.
“The stock market has historically been an intimidating place reserved for a lucky few. As technology continues to disrupt barriers, Public.com is creating a platform that makes investing accessible to everyone,” said Hawk in a statement announcing the new funding round.
Not so public
But while Public has star power and a compelling thesis, it’s unclear how much traction the company is getting in the market. The company declined to disclose how many accounts it has, or how fast it has growing. Public also declined to provide any information about its valulation.
In an interview earlier this year, venture capitalist Ian Sigalow, who invested on behalf of Greycroft, likened Public to Venmo—a network that grew exponentially thanks to its social media attributes. Those attributes, he says, will also allow Public to avoid spending large sums on marketing since it will be able to rely on word of month instead.
Nonetheless, Public may face an uphill battle. A recent report by JMP Securities shows the number of app downloads for Robinhood is more than quadruple those for other brokerages. Those competitors include traditional brokerages and Webull, another trading app with a social media component.
Despite Robinhood’s apparent dominance, the investment in Public suggests investors believe there is room for it to make inroads. Other investors in Public’s Series C round include Lakestar, Greycroft and Advancit Capital.
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