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Today I stop by Public.com’s TriBeCa headquarters for a conversation with Leif Abraham, Co-Founder & Co-CEO of Public.com, an investing platform for equities, fixed income, and alternative assets.
Founded in 2019, Public now serves 3+ million customers and has raised hundreds of millions of dollars from Greycroft, Accel, Lake Star, Tiger Global, and many more.
In this episode, we discuss:
How Leif launched his first internet company as a teenager from his room in Hamburg, Germany
“I stumbled into affiliate marketing… I think I was 15 or 16… and I started funding fan sites for video games, because they were run by kids like myself… I was paying for the expenses, and in exchange, I was getting the rights of all the ad placements and basically turned that into an ad network for gaming in Germany, which was the second largest at the time.”
Importance of building a customer fan base and the concept of emotional retention
“Emotional retention is the one where you're not just with a company because of the utility, you are with the company because of the emotional connection, because of the emotional bond that you have with the company. And then it's just incredibly hard to compete with.”
If you really want to outcompete your peers, you can’t just build a user base, you have to build a ‘fan base’, which can lead to create emotional retention and drive incredible loyalty from your users. By demonstrating a company’s values through actions, businesses can give customers reasons to rally behind them. For example, Public's decision to move away from payment for order flow (PFOF) after the GameStop meme-stock-mania resonated with users and strengthened their emotional connection to the brand. Abraham recommends companies focus on finding opportunities to prove their values and foster emotional retention for long-term success.
International expansion and why bonds and treasuries are definitely back
“We recently launched Treasury accounts, which basically makes it easy for people to invest in T-Bills, daily liquidity, automate rollovers, things like that… And so you've seen really how… people have flowed from meme stocks to T-Bills, and you see how market events and these economic cycles are also forcing functions for people to educate themselves.”
Public.com’s growth since launching in 2019 has been driven by various market events which have helped them expand their total addressable market (TAM). Initially fueled by the COVID pandemic and the subsequent interest in meme stocks and crypto, users' investing literacy has grown over time. With a cooling market, customers have mostly moved away from speculative investments to more diverse portfolios, including ETFs and other yield-bearing products like Bonds and Treasury bills.
Building Public’s app as a mainstream window to the markets, startup founder advice… and a lot more!
“You don't just go to Public to trade, you go to Public because it's your window to the markets.”
Public’s goal is to be the window to the markets, offering not just investing options but also a wealth of contextual information. The app features live shows, social interactions with fellow investors, and relevant cards to help users understand market movements. By providing context and encouraging users to connect with others, Public wants to create an environment that promotes better-informed investing decisions and hopes to reduce the likelihood of panic selling.
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Miguel Armaza is Co-Founder & Managing General Partner of Gilgamesh Ventures, a seed-stage investment fund focused on fintech in the Americas. He also hosts and writes the Fintech Leaders podcast and newsletter.
Leif Abraham, Co-Founder of Public.com – Building a Loyal User Base of 3 Million Users in 3 Years & The Future of Retail Investing