Robinhood CEO Vlad Tenev on the rise of meme stocks: It's a real thing

Robinhood CEO and co-founder Vlad Tenev on Thursday defended retail clients who invest in so-called meme stocks, saying the phenomenon gives embattled companies access to capital they otherwise wouldn’t have.

“I think it’s a real thing. There’s customers that love these companies, they want them to thrive,” Tenev told CNBC’s Andrew Ross Sorkin on Thursday ahead of the stock trading app’s Nasdaq debut. “You’re seeing [meme stocks] also get resources that allow them to hire really good management teams, in some cases, and then build for the future.”

Robinhood helped draw unprecedented levels of new, younger traders to the stock market during the pandemic. That surge has continued into 2021, marked by frenzied trading around meme stocks.

The millennial-favored stock trading app found itself in the middle of a firestorm in January amid the short squeeze in GameStop, which was partially fueled by Reddit-driven retail investors.

“I think what’s interesting with what we’ve seen in retail investing over the past year is that a lot of these companies have been hit hard by the pandemic,” Tenev said.” “It started with some of the airlines and then followed with some of the retailers, some movie chains and brick and mortar. You have the institutions that are basically writing these companies off and then retail investors coming in and keeping them up and supporting them.”

At the height of the meme stock surge, Robinhood restricted trading of certain securities due to increased capital requirements from clearing houses. Robinhood raised more than $3.4 billion in a few days to shore up its balance sheet.

“I don’t know if people have understood the ramifications of what high retail participation in the markets means but I think fundamentally it’s a very good thing,” added Tenev.

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[adamfern]

"Will Robinhood become a meme stock?" DONT MAKE ME LAUGH

[mrxxbrian]

Breaking News. Robinhood to restrict buying puts on $HOOD when options open. kek

[Kyle-liwi]

The sock and shoe game is strong here...

[Hecticam]

Of course its a good thing to have retail's orders in your palm so that you are your future-cellmates can front-run them, ain't it?

[skihillroad]

Don't give this Robinhood guy air time he doesn't deserve it

[hmoney]

Naked shorts, FTD and front running is a problem.

[MrBrm]

Robber Hood. Criminals must be arrested.

[pinhosekbor]

He is talking about meme stock he IS MEME STOCK HE made over a billion dollars ON HIS MEME HOOD STOCK and people got slammed with a hammer 🔨 still recovering from the downfall.

[neilakili]

This will be the highest shorted stock ever.

[rsombrero]

I love the chyrons that says the ceo will offer what customers want.. GameStop want to see you too lol