Uploaded August 2025 | Updated September 2026, 10 hours ago
Shahill Poddar, CEO of Parafin, explains the growth strategy when he was at Robinhood:
"We did a ton of data science and found that when a user sells their first stock, that leads to maximum retention.
It's non-intuitive. But a sell is when you lock-in your first gains, which is what hooks people.
So we took that insight and backed into how we could guide a new user to quickly do their first buy + sell action.
We ended up combining this with our referral program. At the time, if you referred a friend, you got $10, which you could then use to buy a stock. But it didn't work as well as it could have, because it didn't give them an immediate quantum experience of the product.
We knew from behavior economics that humans love unknown variable rewards. People love scratching a lottery card and seeing what they get.
So we changed our reward program. Anyone who referred a friend got one share of stock that was worth around $10. But there was a small chance you might get a much more valuable share, like Facebook or Apple, which were $100+.
This experiment blew every other one out of the water, because everyone wanted to get a valuable share. And it set up new users to quickly perform the most retentive action. And we started pouring fuel on the fire.
It's hard to attribute exactly how much of Robinhood's growth came from this, but it was definitely a large amount of the userbase."
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July 2025 - The Peel Pod 🍌
full video with Turner Novak:
youtu.be/ya0AdTOBn14
Shahill Poddar, CEO of Parafin, explains the growth strategy when he was at Robinhood:
"We did a ton of data science and found that when a user sells their first stock, that leads to maximum retention.
It's non-intuitive. But a sell is when you lock-in your first gains, which is what hooks people.
So we took that insight and backed into how we could guide a new user to quickly do their first buy + sell action.
We ended up combining this with our referral program. At the time, if you referred a friend, you got $10, which you could then use to buy a stock. But it didn't work as well as it could have, because it didn't give them an immediate quantum experience of the product.
We knew from behavior economics that humans love unknown variable rewards. People love scratching a lottery card and seeing what they get.
So we changed our reward program. Anyone who referred a friend got one share of stock that was worth around $10. But there was a small chance you might get a much more valuable share, like Facebook or Apple, which were $100+.
This experiment blew every other one out of the water, because everyone wanted to get a valuable share. And it set up new users to quickly perform the most retentive action. And we started pouring fuel on the fire.
It's hard to attribute exactly how much of Robinhood's growth came from this, but it was definitely a large amount of the userbase."
- - -
July 2025 - The Peel Pod 🍌
full video with Turner Novak:
youtu.be/ya0AdTOBn14
