Building Robinhood, Surviving GameStop & A $500 Million Phone Call | Vlad Tenev

Vlad Tenev is the co-founder and CEO of Robinhood. He was born in Bulgaria in 1987 and moved to the US at age five, a few years before hyperinflation wiped out his grandparents' savings. His parents kept the family afloat on a grad student's budget, and Vlad grew up as a latchkey kid teaching himself computers and tracking stocks on Yahoo Finance. When he scored 1,370 on the SAT at 12, his dad gave him that many dollars to invest. He went on to Stanford and then a math PhD at UCLA under Terence Tao, before his friend Baiju Bhatt convinced him to start a company during the 2008 financial crisis. Vlad tells the story of the near-collapse of Robinhood during the GameStop frenzy in January 2021: how a deposit requirement jumped from under $100 million to $3 billion overnight, why he called Micky Malka of Ribbit Capital first, and how a term sheet they had drafted after the outage in March 2020 made the rescue possible. He also explains why Micky passed on Robinhood's seed round but later became the only investor promoted to its public board, what his first startup taught him, and the legacy test that led him from selling trading software to hedge funds to building Robinhood. Made possible by Ramp: https://router.com AppLovin: https://applovin.com/senra WorkOS: https://workos.com Deel: https://deel.com/senra Chapters (00:00:00) Why Ribbit passed on Robinhood's seed round (00:02:19) "You're going to want me on your board" (00:05:35) The day-long trading outage of March 2020 (00:09:22) A term sheet for a crisis that hadn't happened yet (00:15:00) Crypto goes from zero to a top revenue stream (00:16:27) The $3 billion deposit requirement (00:18:35) "Vlad, you have to call work right away" (00:21:34) The first call: Micky Malka (00:24:31) "Time kills all deals" (00:25:33) Number one app in the App Store, ahead of Instagram and TikTok (00:27:01) $10 billion of demand (00:29:33) Hyperinflation and copper cookware in Bulgaria (00:35:34) "Manhattan just seemed like science fiction" (00:47:15) His SAT score in dollars to invest (00:50:53) Studying under Terence Tao (01:00:22) "You want to be businessman, huh?" (01:03:48) The best parts of math without the bullshit (01:05:56) Would I be proud of this in 50 years? Learn more about your ad choices. Visit megaphone.fm/adchoices

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:02David Senra?

  You and I have a mutual friend in Mickey Malka. I'm a massive fan of his. In fact, I called him this morning and we were talking about you. Why is Mickey so special? Like, why do you think he has the reputation he has with the founders? You know a bunch of founders that know him, just like I do. And it's like, it's very hard to find anybody that has a better reputation with founders than Mickey Malka.

• 0:23Speaker 01

  Yeah, Mickey Malka and I have known each other for a long time. You know, Ribbit got started basically around the same time as Robinhood. I remember meeting those guys, Ribbit, when they were working out of the Social Capital office in downtown Palo Alto. They didn't even have their own office yet. I probably shouldn't be telling you this, but they actually passed on Robinhood at first. So, you know, we were excited to meet them. I pitched Mickey, Nick and Nikolai. This was our seed round at a 10 million cap.

• 1:04Speaker 01

  And it didn't end up getting done, even though I was very excited because it's like, this is a fintech-focused firm. Fintech wasn't even a thing when Robinhood got started. You can look at the Google Trends, it was like zero. And then, you know, a couple of years later, people started using the term. You know, and he'll give me excuses about why they didn't do the deal at the seed. Like, oh, you know, we weren't set up, it wasn't in our mandate, it was too early stage for us. But you and I both know Mickey's the type of guy, when he wants something, he'll find a way to get it done, right?

• 1:39Speaker 01

  I mean, he invested over half a billion into Robinhood in the span of probably 30 to 45 minutes in 2021. I think that with Mickey especially, but also with all of our investors, the best ones, there was a period of us sort of like getting to know each other and earning each other's mutual trust. And with that one, you know, I'd say the relationship kind of grew and compounded over time. So they ended up investing in the Series A with Index and becoming board observers.

• 2:19Speaker 01

  And I remember having a particularly contentious discussion with Mickey around that time because I forget exactly what we were talking about, but I think he wanted more protections than I was willing to give. He either wanted to be on the board or wanted to be an observer. You know, as a founder, especially early stage, you're kind of taught to be extremely protective about board rights. So I was kind of negotiating against him. And I remember I was like walking around next to our office. There was this little park in South Palo Alto and I was just doing paces around this tiny park. And he's like, you know, Vlad, you're gonna learn this about me.

• 3:02Speaker 01

  I'm gonna be, you know, the only investor that you're actually, five years from now, 10 years from now, you're gonna say, you know, I wish you were more involved and you're gonna want me on your board. And of course, at the time, I'm like, okay, well, everyone probably says this exact same shit. But yeah, I think time and time again, in the moments that mattered, he sort of proved that he had our back, my back personally and sort of like the best interest of the company. So Mickey has this very unique thing. And I think at first, when you meet him, he's probably, I mean, he's a particular person, probably not everyone's cup of tea.

• 3:47Speaker 01

  He's not someone that you like immediately like necessarily. He's kind of got a tough exterior, he's a giant man, you know? Probably puts up quite a bit of weight in the weight room. He's got like an aggressive temperament.

• 4:02David Senra?

  These are my favorite kind of people, by the way. So me and him clicked from the very first time.

• 4:06Speaker 01

  The way he kind of challenges me and the company, he does it directly, it's clear. I never worry about whether he has the best interest of me or the company. So I think our trust has just grown over time. And multiple times, he's kind of been there to help the company in our most important moments. He was a board observer in Robinhood before we went public. You probably know this, but typically when you go public, all of the observers go away. And in fact, most of the board members who are venture capitalists end up rolling off the public boards because that's not the business they're in. So Mickey was actually the only one, he got promoted on our board. So he rolled off when we went public.

• 4:50Speaker 01

  And then I came back to him six months later and I'm like, hey, we'd like for you to join this company as a public company, as a full board member.

• 4:58David Senra?

  Why'd you do that?

• 4:59Speaker 01

  Because I just valued his counsel so much. When you're a public company, you get to pick your board members by and large. And you know, when you're private, it's the investors and it's sort of, you pick them, but it's a negotiated deal that the investor owns the board seat. So sometimes you have situations where maybe you get along with a certain board member and then they leave the firm, but it's the firm's board seat. So they get to decide what happens with it. Public company, you pick your board members. And so I have the luxury of being able to select the people on the board now.

• 5:35David Senra?

  You referenced at the beginning of our conversation that he dumped half a billion dollars into Robinhood in like 30 to 45 minutes. Can you tell the story?

• 5:43Speaker 01

  The story actually goes back to March of 2020. So when he actually dumped that money was January of 2021. But eight months earlier, March of 2020 was a big inflection point in Robinhood's history. So it was the beginning of COVID and I'll set out the scene for you. We were in this office, or the one across the street. And we basically occupy the Sunset Magazine headquarters right now. And Sunset Magazine, as you maybe don't know, but has two large buildings. There's like the one we're in and the big one across the street with a giant garden.

• 6:27Speaker 01

  Anyway, there was a running joke because we first moved into the smaller one, then we got the big one. You know, our CFO would constantly have to answer when we're moving into that building because the date kept getting moved back and back. And it's an old building, they had to do a lot of retrofitting. Anyway, March of 2020 was our move-in date. So we marked it with a big hackathon. So over the weekend, we have a hackathon and I remember it was kind of a sad hackathon, kind of poorly attended.

• 7:00David Senra?

  Because of COVID or not related?

• 7:03Speaker 01

  I don't know, I think just like, there was a little bit of a malaise. I don't know if it was COVID related or we just were kind of going through the motions and we didn't really hype it up enough, but not very many people hacked. And then the following day, Monday, March 2nd, 2020, we had a massive day-long trading outage. And this day was like a huge upswing in the market. So there was some up and downs. COVID had started, the market had gone down and in that Monday, it went up. Our infrastructure basically failed and we had a day-long trading outage,

• 7:44Speaker 01

  which was very nerve-wracking because you're a financial firm, you know, people, customers depend on you to trade. And for me personally, as an engineer, I take any infrastructure or engineering issue very, very personally. I feel like I'm failing at my core competency, right? So that happened, we got through it and a week later, everyone went home because we had the start of lockdown. And I remember it was a very confusing time because all the companies that were sort of in our peer group at that time

• 8:27Speaker 01

  were taking precautions. They were planning on cutting headcount, a lot of them were doing layoffs.

• 8:34David Senra?

  What did you consider your peer group back then?

• 8:36Speaker 01

  You know, like Airbnb, DoorDash, those types of companies.

• 8:41David Senra?

  But I think it was- So just tech startups, nothing to do with fintech?

• 8:44Speaker 01

  Yeah, yeah, tech startups, but it was beyond that. I mean, there was just pessimism and, you know, the market had crashed and people just assumed that we were gonna be in dark times for the next couple of years. We didn't really know which way it was gonna go because when you looked at our numbers, we were just seeing crazy numbers. User base was growing, revenue was growing, volumes were growing. So COVID at first seemed like it would be like a headwind, a risk that we would have to manage. And then it became pretty clear that it was just a huge accelerant to the business. But as part of our business accelerating quite dramatically,

• 9:27Speaker 01

  we encountered the capital requirements for the first time. And the way that basically that works is, since we're a regulated broker, depending on how much activity there is on our platform, we have to set aside corporate cash, business cash to like support that activity. And we started noticing during March that, you know, the volumes across equities and options were going parabolic and our capital requirements were increasing as well. And so I call up Mickey and I'm like, hey, things are really good right now.

• 10:08Speaker 01

  Revenue's growing, business is growing, not sure how sustainable it is, if I'm being honest, because it's like we're doing three times the volume that we did a month ago. But-

• 10:20Speaker 01

  There is a chance that I'm gonna need hundreds of millions of dollars really quickly. Because, you know, what if one day our volume 10X is? And, you know, uh, there's these capital requirements. And, um, and he's like, okay, well, let's work out a deal. Let's have a term sheet in place so that if that does happen and, you know, you need it, we, we can just like set it up, sign the docs and the money is wired in your account same day.

• 10:50David Senra?

  Smart.

• 10:51Speaker 01

  And nobody else was willing to do that kind of, that's like a improvised deal.

• 10:56David Senra?

  Right.

• 10:56Speaker 01

  And remember at the time, venture capitalists weren't really investing. Everyone had kind of batten down the hatches to see what was, what was happening with COVID. And a couple of months later, it became clear that some businesses were actually doing well. And, you know, then, then the floodgates opened again and it became one of the biggest bull markets ever and kind of a speculative, uh, extravaganza from, I'd say, second half 2020 to second half of 2021.

• 11:25David Senra?

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• 12:08David Senra?

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• 12:53David Senra?

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• 13:23Speaker 01

  March of 2020, we work out this deal and we feel really good. And then we ended up raising capital from Sequoia and then D1. So we never really had to take that term sheet, uh, off the shelf because we felt really good and, and things that kind of stabilized and went to a more normal period of growth. Then, uh, January of 2021 happened and it was like a huge inflection point in speculative trading activity.

• 13:57David Senra?

  Why? I don't remember.

• 13:58Speaker 01

  I think part of it was the new year. Every time you cross from like, uh, end of December to early January, we, we kind of see, uh, an inflection point in, in, in activity, like a step change in activity. I think it's behavioral, people are home, you know, the end of the year is kind of, uh, closing of the chapter, opening the new one and, and, and people start thinking about their finances more. So they open, you know, Robin Hood accounts and, and start buying stocks. Uh, so there, there was that. Uh, there was also stimulus checks, which dropped in people's accounts.

• 14:39Speaker 01

  There was lack of other things to do to spend your money. And a lot of restaurants and sporting events were closed. So, uh, in the zero interest rate environment. Yeah, what we saw was just a insane amount of interest in crypto and stocks at the same time. And our crypto business, which we launched in January of 2018. And for a while it was generating next to nothing in revenue for many years, like close to zero. Because January of 2018 was the start of a prolonged crypto winter.

• 15:21David Senra?

  Okay.

• 15:22Speaker 01

  And, and we had just gotten started, so we didn't have a established base of activity. So people, people were buying and there were some moments where, you know, we had more activity, but call it close to zero until 2020. Then Q3 of 2020, it just went up by 10X. So we, we started seeing, you know, tens of millions of quarterly revenue. Q4 was, it was hundreds. And by Q2 of 2021, I think we had something like 500, 600 million of crypto revenue. So it went from nothing to, uh, our largest or second largest revenue stream. And this was happening alongside all of the meme stock stuff. So yeah, we, we had to contend with, with both of these things.

• 16:07Speaker 01

  And remember by that point, my mind was on the full day trading outage of March of 2020. That was like the last big crisis we had. So I was like, I'm an engineer, keep the systems up, make sure that, uh, you know, we, we can serve our customers. Cause you know, that was the devil I knew. So yeah, we were just kind of blindsided by the capital requirements issue springing up overnight again. Our capital requirements.

• 16:35David Senra?

  Was it really overnight?

• 16:37Speaker 01

  It was basically overnight and day of this got kind of confusing because the numbers kept changing. But the first number that came through the automated files was something like 3 billion. So it was like 3 billion, then 1.8 billion, then we had a file that was 700 million. Well, so by the time I woke up, uh, which was 5:00 AM Pacific. And this was like a very unique moment in my life. First off, at that time I was sleeping with my phone downstairs because I felt like I was in a bad headspace, just like on my phone the entire time.

• 17:18Speaker 01

  Like I think COVID at the beginning was very euphoric for me because I was like, oh, I can be so efficient. I can do all this work and then my family is right here and I can just be plugged in while also being present with my family. But a couple of months go by and I realize it's not very good for me. I was just like, uh, distracted all the time, always on my phone, always working. So I was trying this thing where I would sleep with my phone in a different room.

• 17:45David Senra?

  But specifically describe your, you said it was a bad headspace. Yeah. Anxious, depression? What is it?

• 17:54Speaker 01

  Definitely anxious, probably not depression yet. But the best way I can describe it is no matter how good of a meeting I have, if it's on Zoom, I want the meeting to end and I want to kind of go outside, right? It's, it's very different than having a meeting and in real life for me where I can kind of vibe with the people. So I realized that about myself during COVID, that I'm not a remote work person. Yeah, it just, it just doesn't make me happy. No matter how good of a meeting I have, how energizing, I just kind of don't want to be staring at people on a computer screen.

• 18:35David Senra?

  So you're sleeping downstairs with your phone?

• 18:37Speaker 01

  Yeah. And so my wife wakes me up, just like folks from work call her and.

• 18:43David Senra?

  That's not good.

• 18:44Speaker 01

  And she doesn't really get a call from work that often. So she knows it's bad. She's like, oh my God, oh my God, Vlad, you have to call work right away. So I go downstairs and I pick up my phone and my phone is unusable. It's literally like vibrating constantly. Just I pick it up and it's, text messages coming in, calls going to voicemail. It's like, uh, I, I think I saw this on Instagram one time when Kim Kardashian turns off her do not disturb. And then you just see that, you know, the phone just starts glitching because people are just commenting on her Instagram posts. Anyway, that's probably the closest I've gotten to that.

• 19:26Speaker 01

  And yeah, it was kind of like hate tweets and voicemails like, you know, how could you do it?

• 19:36David Senra?

  Wait, wait, what's going on? I thought you had to turn off trading because you didn't have the money to put up? What is exactly?

• 19:43Speaker 01

  Yeah, so I don't know what's going on.

• 19:44David Senra?

  Okay.

• 19:45Speaker 01

  And I'm expecting a call from Gretchen, who is our COO. And, you know, I pick up my phone and in between the calls and text messages, I figure out that I can go into settings and block unknown numbers. And then Gretchen gets through. And then she's, you know, explaining, explaining things to me. The upshot of it is we had to PCO GME. So I had to mark GME, which is GameStop stock, position closing only, which since we didn't allow shorting, meant people could only sell it. If you, you couldn't buy more GME, if you didn't own it, you couldn't buy it. And if you owned it, you could only sell it. She was kind of explaining why.

• 20:29Speaker 01

  It was like, well, first they asked for three billion, then it was 1.8. We didn't have that much money. Maybe it was a little bit more than that, but definitely not three billion. 1.8 would have been tough. And so, okay, what do we do? I don't know, let's get on a call. We got the leadership team on a, on a Zoom call, you know, and everyone was kind of in different places, which made this, this type of fire very difficult to fight because first thing you do now is pull everyone in a room together. Well, there was no room. It was a Zoom call. We kind of decide that we're going to split off into a couple of work streams. One work stream is to figure out how to communicate to customers because they were obviously very, very angry at that time.

• 21:12Speaker 01

  And so, you know, the marketing and comms folks started working on that. Then there was the engineering, just keep the systems up, which knock on wood, that was actually my biggest fear, but the systems were actually like holding up throughout this crazy activity. And then the third work stream is.

• 21:28David Senra?

  Find the money.

• 21:29Speaker 01

  Get the money. We didn't know how much we needed, but it was just get as much as possible.

• 21:34David Senra?

  So when you know that you need to find the money, who's the first person you call?

• 21:36Speaker 01

  I called Mickey.

• 21:37David Senra?

  That was the first call?

• 21:39Speaker 01

  Yeah, yeah.

• 21:40David Senra?

  Yeah.

• 21:41Speaker 01

  Yeah, and, and he committed on the spot. He's like, how much, how much do you need? I said, I don't know, 250 million, 500 million, I'm not sure. He's like, I've got it.

• 21:51David Senra?

  He didn't have it yet, though.

• 21:53Speaker 01

  Well, so I learned later in an odd twist of fate that he called up the CEO of SVB.

• 21:59David Senra?

  I was gonna say it's Silicon Valley Bank. I've heard the story before.

• 22:02Speaker 01

  Yeah. Yeah, cuz I, I, I had a coffee with, gosh, what was his name? The CEO of SVB, great guy. He went through his own issue that unfortunately didn't end as positively. But yeah, he was on the golf course in, in Hawaii. And he's like, and Mickey calls him, he's like, I'm gonna have to pull down that line of credit that I set up with you guys. So he didn't have the money, but he had a line of credit.

• 22:33David Senra?

  Yeah.

• 22:34Speaker 01

  And anyway, that ended up being a consequential first call because these times are times of high uncertainty, as you can imagine. You know, nobody wants to give money to a business that's about to collapse. And, and I think legitimately, there were people that were, that were afraid of this. It's like when in financial services, if there's a solvency issue, you know, you don't want to be, you, you have to get your money out first. You certainly, it's, it takes a lot to actually move money in, to inject money at that time, as, as we've found in many failures since then. You know, and I noticed when I tell this story, depending on where we are in the world,

• 23:18Speaker 01

  people are much more sympathetic to what we went through. Like after the FTX collapse, people are like, okay, I get it. After the SVB banking crises, I think people got it more too.

• 23:28David Senra?

  You know, it's funny that you bring up FTX and SVB. I'm thinking like Jay Gold, I'm thinking of like the stuff that happened way before mentioning the SEC, like there was, I mean, this was something that throughout, especially American financial history, I've read tons of biographies, it's like, they did this on purpose, they did it for fun. Cornelius Vanderbilt, Daniel Drew, like there's all these people that would especially like cause bear runs to happen and then would profit. And obviously, there's a lot of financial regulations that came out of this.

• 23:53Speaker 01

  Totally. And actually, if, if you look at the history of the specific capital requirements that had exploded for us, a, a lot of that came up as a result of Dodd-Frank.

• 24:06David Senra?

  Yeah.

• 24:07Speaker 01

  As, as a result of the global financial crisis in 2008. They said, okay, we want to make sure everyone is like super capitalized to handle the trading activity that they could handle. So we have these like onerous capital requirements. Of course, they never anticipated that people would be, it would be, you know, retail traders trading meme stocks.

• 24:28David Senra?

  At home with stimulus checks.

• 24:30Speaker 01

  With no commissions.

• 24:31David Senra?

  Why did you say it's a consequential first call though?

• 24:33Speaker 01

  I think it could have gone another way where the first call wasn't as strong of a reception. They said, you know, we'll think about it. I've got to talk to my team, I got to talk to my CFO. And, and then maybe the second call also said something like that. And then the third call asked me, well, is anyone else doing it? And I have to tell them, no, you're my first call. You know, and time kills all deals. So having Mickey actually answer the phone and commit on the spot got things started for us.

• 25:05David Senra?

  Did it give you confidence, like for me personally?

• 25:08Speaker 01

  Yeah, what that did for you. So this was a really interesting time because juxtapose this like big, we're trying to raise a lot of money, this big like financial need that we had, which typically companies that are in that state are not doing well. It's a kind of a bad situation. But the reason we were in that situation was because we were growing too quickly.

• 25:29David Senra?

  Yeah.

• 25:29Speaker 01

  It was a consequence of too much success, which is quite rare. So at that time, Robinhood was the number one app in the App Store, not just in finance, which is, you know, kind of a, still good, but we were ahead of Instagram, we were ahead of TikTok, number one overall, extremely rare for, for a finance app. We'd never seen anything like that. So we were in this position where we needed capital, but also we were growing tremendously quickly, which was hard to keep in your head at the same time. Because as a leader, obviously, I'm excited about the growth, the success, the revenue.

• 26:11Speaker 01

  I mean, the, January 2028, we hit 1.8 billion run rate, something of that nature. Like we had crossed, the company, I think, made 200 million in revenue in 2029, in 2019. Then we went to close to a billion and then we ended up doing.

• 26:27David Senra?

  So you 5Xed in 12 months?

• 26:29Speaker 01

  Yeah.

• 26:29David Senra?

  Okay.

• 26:30Speaker 01

  4X, yeah. And then in 2021, we got to 1.8 billion. So obviously, that growth was exciting to me and I was cheering it on. But also, along with that rapid growth, came just a increase in risk.

• 26:45David Senra?

  But go back to the, the consequential nature of the call and the fact that Mickey just, he's like, yeah, you got the money, you're done.

• 26:51Speaker 01

  The fact that he committed on the spot and said, I'm in.

• 26:55David Senra?

  Okay.

• 26:55Speaker 01

  Made everyone else, every conversation after him, much easier.

• 27:01David Senra?

  How did those conversations go? So the second call, you say, hey, Mickey Malko's giving me half a billion dollars?

• 27:07Speaker 01

  Same calls, Mickey Malko's in, okay, I'm in too. And then eventually, we started getting the calls, right? It's like, how much is left? And then we were like, wait, wait, wait a minute. These warrants, yeah, we have to change the deal because we probably had, you know, $10 billion of demand at the first term.

• 27:29David Senra?

  I love the story you just told cuz you're like, yeah, this happened in, we're saying, what? We're, we're January 2021?

• 27:34Speaker 01

  Yeah.

• 27:35David Senra?

  Okay, but you're like, it actually didn't happen then. It happened March 2020, when you guys did this term sheet, didn't sign it, just put it in a fucking drawer, but you knew it was gonna happen.

• 27:45Speaker 01

  Yeah.

• 27:45David Senra?

  That's incredible, dude.

• 27:47Speaker 01

  Yeah, pretty much. I would bet we would have gotten it done either way, but it certainly helped that we had gone through that exercise of thinking about the stuff.

• 27:58David Senra?

  Have you heard of anything else like that? I can't think of another example.

• 28:01Speaker 01

  Of just, of freshened business planning to that degree? I don't want to give myself too much credit, you know?

• 28:08David Senra?

  I might give it to Mickey, I might give it to Mickey, that's incredible.

• 28:12Speaker 01

  And during that time, a lot of our counterparties, because we, we have lots of counterparties for running the business too. Securities lending, for instance, which are big banks, and they have credit risk departments. So I had to do a roadshow throughout all of this where I talked to all of our banks and I assured them that our financial condition remains strong because, you know, if they pull their lines of credit, it could also create a cascading failure. So, you know, what we pulled off, I've been told, was a miracle, right? There's many ways that the firm could have actually gone bankrupt and, and gone insolvent, but I think we just navigated it.

• 28:54David Senra?

  Let me close the loop on Mickey though. I have a question. How does he end his phone calls with you? What does he say? What's the last thing he says to you?

• 29:00Speaker 01

  I think they just kind of peter out.

• 29:02David Senra?

  I gotta ask him why, what he knows about me, but every time, I think it's the last three times we've hung up the phone, he says, behave.

• 29:09Speaker 01

  Oh, yeah.

• 29:10David Senra?

  He doesn't say bye, he's like, make sure you behave. Or no, he just says behave and then the call ends. Like, what does he think I'm gonna do?

• 29:15Speaker 01

  Are you sure that's not just him saying something in Spanish?

• 29:18David Senra?

  No, no, cuz I would know it, my dad is Cuban. So, no, I'm just like, all right, I gotta ask him why, what does he think I'm gonna do over here?

• 29:24Speaker 01

  He never tells me to behave.

• 29:26David Senra?

  I know, exactly. So I was like, all right, this is.

• 29:28Speaker 01

  Maybe he thinks I'm more well behaved than you.

• 29:30David Senra?

  Apparently. Okay, so wait, I wanna, this is very curious, like, were you, when you were younger, when you were like a kid, were you always interested in financial markets? Does this, this, this interest come later in life?

• 29:42Speaker 01

  I was always interested in financial markets.

• 29:45David Senra?

  How and why? Like he's how Mickey told that crazy story in my podcast where I think he like borrows money from his grandfather to buy an, and his grandfather charged him interest to buy one share of Berkshire Hathaway and he thinks he's like 13 years old or something?

• 29:59Speaker 01

  Yeah.

• 29:59David Senra?

  Like, was it like this with you?

• 30:01Speaker 01

  I immigrated from Bulgaria to the US in 1992 and.

• 30:09Speaker 01

  The year before I left, 1991, Bulgaria went, started going through significant inflation. I think the inflation rate in 1991 was like 170%.

• 30:20David Senra?

  Very similar to what you, Mickey, experienced in Venezuela.

• 30:24Speaker 01

  In 1997, a couple of years after, we'd just escaped or immigrated or what have you. Bulgaria had the unfortunate distinction of the highest inflation rate in the world.

• 30:35David Senra?

  Really?

• 30:36Speaker 01

  1700%.

• 30:38David Senra?

  Over what time period?

• 30:39Speaker 01

  One year.

• 30:40David Senra?

  Oh.

• 30:40Speaker 01

  Yeah, so, you know, they were adding zeros to the currency. It went from like, uh, two leva to a dollar to 2,000. And, you know, I, I saw what it did to my grandparents. So it, it went from kind of being a keen observer to what the communist system, how that affected my family. Because my family would always tell this story. On my mom's side, collectivization came in, I want to say the, the 1960s really got intense. And so I grew up and, and we lived in this apartment building.

• 31:19Speaker 01

  Well, they, they showed me pictures on that territory where there was now this like, kind of brutalist Soviet era, kind of hideous apartment building that I grew up in. There was this nice yard and house that my great grandfather used to own. And, uh, they came in and kind of confiscated.

• 31:39David Senra?

  And built a big ugly structure.

• 31:41Speaker 01

  Big ugly structure, but of course they gave him a, one of the apartments in there. And then on my dad's side, he always tells the story about how his great, great grandfather lost his land. They had like 100 acres or something. And, you know, him and his, his buddies from the village took the, the long, arduous trip to the capital to argue in front of the courts that they should have their land back. But they were kind of laughed out and, and sent back to the village. So anyway, everyone was kind of lamenting the loss of their property. And then, uh, hyperinflation came and every, the financial system collapsed. And I think my grandparents were very lucky because they had just retired.

• 32:24Speaker 01

  And my, my parents, who were just beginning to get established in the US, had to support them effectively. So all of our big arguments were, were about money as a family. Which side was getting more, you know?

• 32:41David Senra?

  How old were you when this is happening?

• 32:43Speaker 01

  I was five when I, when I moved and by the financial currency crisis, I was probably 10, 1997. I was born in 87. And then also my grandfather, uh, one of my earliest memories was opening up this closet in, uh, in their apartment. And it was just copper cookware falling out. That was their, uh, their investments.

• 33:06David Senra?

  That was their store of wealth.

• 33:07Speaker 01

  They would hoard, they would hoard copper.

• 33:08David Senra?

  Because the inflation was so bad.

• 33:10Speaker 01

  The inflation was gruesome. And I also remember the Cuban bananas were very delicious. When I came to America, one of the things that shocked me was you go into the grocery store, there's bananas everywhere. Of course, I couldn't touch the organic ones. My mom would slap my hand if I got near those. But in Bulgaria, Cuban bananas were like a once a year thing where my grandfather would kind of have his hook up over at the, over at the shipyards, right? So it was very, very different.

• 33:39David Senra?

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• 34:18David Senra?

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• 34:42Speaker 01

  Yeah.

• 34:43David Senra?

  Okay, so when do you have this interest in, you, you're hearing these crazy stories from your, your, obviously your parents and your grandparents. Do your grandparents make it to America as well?

• 34:50Speaker 01

  No, no, they don't.

• 34:52David Senra?

  Okay, so they stay there the whole time?

• 34:53Speaker 01

  They stay in Bulgaria, yeah.

• 34:54David Senra?

  Okay.

• 34:55Speaker 01

  Yeah, the, the first time my grandparents came to America, this crazy story, was on September 11th, 2001. They, uh, they're scheduled to have their first trip to the US to visit us for the first time. September 11th, 2001, they depart Bulgaria on way, on the way to the US. Of course, their plane.

• 35:18David Senra?

  They close the airspace?

• 35:19Speaker 01

  The plane gets immediately rerouted to Frankfurt, Germany. And they spend two weeks, uh, in the basement of the Frankfurt airport.

• 35:27David Senra?

  Oh, wow.

• 35:28Speaker 01

  Yeah, just they had like rows of beds, uh, pending the, the next flight.

• 35:34David Senra?

  Okay, so you're, let's say 10 years old. When do you start paying attention to financial markets, money? When do you get an interest in this?

• 35:42Speaker 01

  When we land in America, there was just this huge sea change immediately. Like the vibe was completely different. And I noticed it as a, as a five-year-old. Because in Bulgaria, you walk around, it's, the society's collapsing. All the old ladies are like looking down and everyone's moving kind of slowly. My first arrival in America, still remember it, I landed in JFK. And my parents lived in Delaware because my dad was a grad student at University of Delaware. So on the drive from JFK Airport, uh, to Delaware, we drove through Manhattan. And to a Bulgarian kid who just got on the plane ride.

• 36:27David Senra?

  It's gotta be like another planet.

• 36:28Speaker 01

  Manhattan just seemed like science fiction. I was like, is the, is the whole country like this?

• 36:33David Senra?

  Yeah.

• 36:34Speaker 01

  Like the buildings are so, every single building would be the tallest building in Bulgaria. It's like the buildings are competing with each other, right? There was no competition in Bulgaria. People weren't competitive. People were just moving quickly. I was like, is everyone just, why is everyone in a hurry? And so, and I think the other thing that happened was I was the only child and my parents were kind of just getting started. And they were always figuring out how to move ahead in their careers. And I kind of felt like, uh, equal partner in that almost. So my parents would sit me down, they'd say, look Vladimir, you know, our status as visa holders in this country is very, uh, fragile.

• 37:18Speaker 01

  We get deported at any moment. By the way, your dad isn't making any money. So you're gonna have to get a scholarship if you want to get to college. You know, can't, can't count on us, basically. And so from, from pretty early on, I was like, oh, okay, you know, money's pretty tight here. You know, I was, I was just thinking about all that stuff.

• 37:37David Senra?

  You're an only child, they never had another kid after you?

• 37:40Speaker 01

  No.

• 37:40David Senra?

  But they're talking to you as almost like.

• 37:41Speaker 01

  Because of our financial situation.

• 37:43David Senra?

  Yeah, which is devastating.

• 37:44Speaker 01

  Yeah.

• 37:45David Senra?

  I'm sure it's probably their biggest regret. Are your parents still alive?

• 37:47Speaker 01

  Yeah.

• 37:48David Senra?

  God bless them, they've seen your success. That's gotta be awesome for them.

• 37:52David Senra?

  I bet you if you talk to them, their biggest regret is probably not being able to have more children, I would guess.

• 37:56Speaker 01

  Yeah.

• 37:57David Senra?

  But they're talking to you like an adult, which I think is very smart. And not like hiding things, you know, saying, hey, we're in dire situation. Like if you, you obviously want a better life, you're in this country. You see the difference between Bulgaria and America. This basically lights a fuel, like, inside of you.

• 38:13Speaker 01

  Yeah, and I was a latchkey child too. My parents couldn't afford a babysitter.

• 38:18David Senra?

  Yeah, we were around the same age. I, like, the idea, like, we just ran the streets whenever you wanted to.

• 38:22Speaker 01

  Ran the streets, I would walk home from the bus stop, a mile to the apartment building. At first, they were like, knock on the neighbor's door, who was this Indonesian family? And, you know, she'll let you in, she'll give you the key. Then they realized, well, our son's going through this kind of complicated chain of events to get home. Why don't we just, we can trust him with the key, so.

• 38:43David Senra?

  And so then you find computers, you get interested in computers. So how old were you then?

• 38:47Speaker 01

  I was probably five or six.

• 38:49David Senra?

  Really?

• 38:50Speaker 01

  So what happened was, in lieu of a babysitter, my dad would sometimes take me to grad school with him. He was a grad student at the University of Maryland.

• 38:59David Senra?

  What was he studying?

• 39:01Speaker 01

  Economics.

• 39:01David Senra?

  Okay.

• 39:02Speaker 01

  So I would hang out in the computer lab and, you know, he would be going to class or, or whatever. So my first experience with computers was just hanging out there, right?

• 39:15David Senra?

  But you had free reign to do whatever you want while you were in school?

• 39:18Speaker 01

  Okay, totally, yeah. And I, he didn't know how to use computers, I didn't know either. He's like, play, play around, figure it out for yourself. And I kind of got into it pretty quickly. Of course, I started gaming, you know, figure out, figure out how to install games. Cause there were other grad students there and they showed me and be like, hey, can I take the floppy disk? And then somehow, we didn't have any money, but they decided it would be a good idea to buy a computer ourselves. So we, we got a computer, maybe when I was seven years old. I got really into this thing. Didn't have internet, of course. So I was like, uh, you know, learning to use the terminal, doing all of that. I was a pretty good student.

• 40:04Speaker 01

  Another thing that my parents, I think, uh, at the time, I was kind of annoyed at them for this because all my friends were always in activities, right? They were like doing baseball or T-ball or basketball or soccer. My parents were basically like, first off, we can't afford any of this stuff. Second of all, I don't know who's gonna drive you. You know, we have one car and we're both working, so you have to like figure that out for yourself. You know, you want to call your friends, get a carpool. I was like six years old, so it just never happened. And so I was just kind of, uh, at home a lot, on the computer. And, uh, when, when we ended up getting internet eventually, uh, I opened up Yahoo Finance

• 40:49Speaker 01

  and like, uh, created a portfolio.

• 40:53David Senra?

  Why?

• 40:54Speaker 01

  I don't even know how I got into it, but, uh, but, but I did. And I just, yeah, got into it.

• 41:04David Senra?

  And so was stocks your first fascination?

• 41:05Speaker 01

  Yeah, stocks, computers and computer games.

• 41:10David Senra?

  And at this point, were you already you already had an interest in math or no?

• 41:15Speaker 01

  Yeah, I think pretty early on I realized that I was good at math. You know, and this was kind of interesting for me, too, because I was dropped into school in America, kindergarten, not knowing a word of English. So my first experience was kind of disheartening in a way. It's like you're going into this place, don't even speak the language. I can't even tell the teacher that I want that toy, right? So a couple of months ago, I was reading my old report cards. I found my report cards from when I was in kindergarten. And, you know, the teachers were writing about me. I read this one that was like, you know, Vladimir, he's adjusting well to kindergarten.

• 42:00Speaker 01

  He's not talking to the other children yet. It kind of made me sad. So I'm like, man, I wasn't talking to the... So six months in, probably because I didn't know English and I was just shy and quiet. By, I guess, the end of first grade, I was in advanced English and advanced math. So this was back when they would kind of still sort kids. You would have talented and gifted. Yeah. So by the end of, yeah, I guess in one year, I had gone from not knowing anything, not talking to anyone, to kind of being in the most advanced math and English. And, you know, the teachers were like, okay, well, maybe he should skip a grade.

• 42:43Speaker 01

  So I got to feel that trajectory. And I think at that point, I realized, okay, I'm probably, I guess I'm good at math and school and learning.

• 42:53David Senra?

  But if you go back to like, you're a kid sitting alone in an apartment on your computer, building a portfolio on Yahoo Finance. Was it just because you're like, hey, I'm sick of fucking being poor? I don't want to reenact what I saw in Bulgaria. And I'm in like, do you think you even understood why you were interested in finance? Did you see it as a path to like, become wealthy one day and essentially have more control? Because what you're describing right now is like, essentially, your family, I mean, a lot of families, you know, when you go back to Mickey Malka's family having come from Venezuela, I think he was like in his 30s. My father, obviously, he was born in Cuba, came here. Like, you have a lack of autonomy, a lack of control.

• 43:26Speaker 01

  Yeah.

• 43:27David Senra?

  And some people are just like, they just break under that pressure. And other people, which is the read I'm getting on you, is just like, I need to find a way out and a path out where I actually have control and actually can build wealth and have control of a future and build a future vastly different than the ones that your grandparents experienced, for example?

• 43:45Speaker 01

  Yeah, I think at that point, I was terrified of the downside case, which was, shoot, what if, what if, you know, we're homeless? Or I'm homeless? Or I can't just figure out all this stuff? Like, I thought that the prospect of getting a job that paid me a lot of money, because I didn't know anything about entrepreneurship at that point. It was just not even in my vocabulary.

• 44:11David Senra?

  Because you don't have any entrepreneurs in your family, right?

• 44:14Speaker 01

  Yeah, well, actually, my dad had an entrepreneurial venture in Bulgaria, which I was too small to kind of realize it at that time. But he started a tourism business.

• 44:27David Senra?

  Is there a lot of tourism when the society is collapsing?

• 44:30Speaker 01

  Well, as soon as, as soon as the Berlin Wall fell, there was this influx of tourists that came. They couldn't come from Western Europe before. And my dad spoke French. So they started this business called Contour, kind of a cool name, where they would basically take the French tourists around the Bulgarian sites, which there were lots of amazing historical sites. Tourism is still the largest industry in Bulgaria. I think, I think it was probably still doing well during the collapse because it relied on foreign money. And yeah, small scale and not a technology business. They would like buy buses and take people around.

• 45:11David Senra?

  But did you think you were going to get, when you said, okay, I didn't even think, didn't even know, really know entrepreneurship was a path that was available to me at that time? Did you think you were going to get a job in finance? Like, what did you think, if you could go back and talk to that version of Vlad, what did he think he was going to do?

• 45:26Speaker 01

  I think my mom's ideal picture of what I would end up doing would be getting a job as like a analyst at JP Morgan or something. Or, God forbid, Goldman Sachs. That would have just blown my mom's mind. Or, you know, consulting, McKinsey. Yeah, because both of my parents started working at the World Bank. My dad actually began working at the World Bank while he was a full-time grad student at University of Maryland. So he had two full-time jobs. He was a full-time grad student, full-time at the World Bank. And he paid for, we got enough money for my mom to get an MBA at Georgetown to also join the World Bank. And they were there for their entire professional careers.

• 46:10Speaker 01

  So 25 years each. Yeah, it's kind of interesting. My parents took this like, one massive risk of just uprooting the entire family, moving to this new country. I think when they got here, they were just very focused on stability. It was almost like, we're done. Like, that was just such a crazy experience that, let's just make sure now that we're here, we can stay here and, you know, we can provide a good foundation for our son. Yeah, I think for me, the interest in investing at first was curiosity. Like, I had heard about investing. I was on all the message boards. I saw people talking about it. We were in the midst of the dot com boom. So it was just there.

• 46:55Speaker 01

  Of course, I saw, you know, reports that some people were making a lot of money. That was attractive, but...

• 47:01David Senra?

  Yeah, but at that time, you were probably, what, 13 in 2000? Something like that? You were born in 87?

• 47:05Speaker 01

  Exactly. I was learning, right? Yeah, I had a simulated portfolio that did quite well during that time period, probably because everything was doing well. But then my dad gave me a challenge. He was like, I was studying for this test because I was in this program called CTY. I don't know if you're familiar with it. Basically, you take the SAT. Depending on how you do, they put you into this program where you get to do a year's worth of math in two weeks. I was doing this thing and I think I was in seventh grade at the time. And I had skipped a grade, so I was 12 years old.

• 47:46Speaker 01

  And he said, all right, if you get above 1300 on the SAT, I will give you your score in dollars to invest with. And this was very motivating to me. I think he did a very smart thing because I just got after it. And I ended up getting a 1370 on the SAT. So he gave me some money to invest with. So then that became my real portfolio.

• 48:12David Senra?

  Now you don't have a simulated portfolio.

• 48:14Speaker 01

  Now I don't have a simulated portfolio. And now I deploy real capital.

• 48:19Speaker 01

  And of course, a couple of months later, the market crashed, but not before I made a smart move. So I bought this company, 3Com, which made the Palm Pilot, which was like the first PDA, Personal Digital Assistant. And so I put a lot of money in 3Com. And it spun off Palm. So I went from having one stock to having two stocks. And then I remember, you know, getting the big packet of shareholder information in the mail and leafing through it. And it gave me this feeling like I actually own something, right? And there was just, even though it wasn't a ton of money, there was like some pride in that.

• 49:03Speaker 01

  Like, not only did I buy this thing, but I'm an owner of this company. They want me to vote. They care. I got to learn what a corporate reorganization and spinoff is, tracking this portfolio. I learned a lot and...

• 49:16David Senra?

  Excellent real-life education for a kid, all from this idea that your dad had.

• 49:20Speaker 01

  I got super passionate about it. Yeah, and, you know, I started trading quite a bit. I had Nvidia pretty early.

• 49:28David Senra?

  And you held it all the way through, right?

• 49:29Speaker 01

  No. Sold, sold at 25. Because they made great graphics cards. I loved...

• 49:37David Senra?

  And you were a gamer.

• 49:38Speaker 01

  I loved gaming.

• 49:39David Senra?

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• 50:21David Senra?

  The founder of 11 Labs has a great description of the value Deal can give your company. He said, "We built 11 Labs to break down language and communication barriers. With Deal enabling us to hire and support exceptional talent anywhere, we can accelerate our innovation and bring more voices, stories and ideas to every corner of the world." Deal is trusted by over 40,000 companies and growing fast. Learn how they can help your business by going to deal.com/cenra. That is deal.com/cenra. So let me ask you a question. I've heard you say before that you find entrepreneurship intoxicating.

• 50:58Speaker 01

  Yeah.

• 50:58David Senra?

  Now, I can't get a read on you, whether you're more into finance because you've built a business that facilitates people to trade, or you're more into entrepreneurship? Like, which one is more dominant in your brain? Entrepreneurship or investing?

• 51:14Speaker 01

  I think that's an interesting question.

• 51:16David Senra?

  Those are the only kinds I have.

• 51:18Speaker 01

  Yeah, it's always hard to figure out the contrapositive of what would have happened if Beju, who's my Robin Hood co-founder, hadn't called me and convinced me to start our first company together. There were a lot of competing forces. So before I became an entrepreneur, I was a math grad student. And... I think my, uh, my relationship with math was a long and somewhat tortured one. So from when I was in kindergarten, it became really clear that I was good at math. I was like the top math student in my class and I started getting all this positive reinforcement. Well, do more math, do it in the summer, do a year's worth of math in two weeks.

• 52:03Speaker 01

  And it kind of became this self referential loop where I would just try to climb the ladder, right? All the way through to becoming a math PhD student at UCLA, um, studying under this, this guy Terence Tao, which many consider to be the greatest living mathematician. So kind of pretty high in the hierarchy. I mean, I wasn't a postdoc or professor, but I was, I was definitely probably in the top 0.001% of how much math a, a person realistically would try to learn. So I was in math grad school. Uh, my first month in grad school, you have the start of the global financial crisis.

• 52:45Speaker 01

  And even though I had been at Stanford, I wasn't really in the entrepreneurial circles. And, and also back then Stanford was not quite as entrepreneurially focused as it is today. Like the number one major wasn't computer science. A lot of people wanted to go into finance, but like, you know, Goldman, JP Morgan. I wasn't really in those circles. I was more in the math and physics kind of research circles. And my math and physics friends weren't very employable. This was like pre data science, pre AI. Everyone was hiring computer science people. So I was also in a weird position of not having a ton of attractive

• 53:30Speaker 01

  work options, like I didn't get a ton of job interviews. I kind of went to UCLA because of the best option, the default option, continue doing math. I have, uh, I was getting paid $18,000 to be a grad student. Get to hang out in LA, which we both know is very nice. Although not a very nice place if you're super poor, uh, to be clear. I was kind of drifting at that time. And, and then I get into grad school and I see all of these immigrants. And there were people who I imagine kind of like my dad had fled their countries. And this was kind of their moment. So they were doing math all the time. You know, they, they wouldn't go out. They would just be sleeping, eating, going to class, doing math.

• 54:13Speaker 01

  And then I remember thinking to myself, man, if I'm not like that, what am I even doing? Like, there's no way I'm gonna, you know, out compete these people, uh, for that ever winnowing number of postdoc positions. And I kind of asked a lot of questions of myself, like, do I even want that? Is that the life that, that, that I want? Well, you know, Terence Tao, the greatest mathematician in the world. Maybe there's like 20 people in the world that can understand a Terence Tao paper. So it wasn't like what you learn in, in class, you know, Gauss, Riemann, all these great mathematicians that every child learns their work.

• 54:57Speaker 01

  You know, it had gotten so specialized that, you know, you, very, very few people read this stuff now. So at that point I started asking myself, is this like ladder of math leading me to a good place? And I realized, no. The romantic idea of like learning for learning sake and progressing and making discoveries kind of collided with the practical reality of this being just like one of the worst careers and jobs. And I'm not even talking about dealing with like the administration of the university and all of that bureaucracy. So I wasn't very happy with what I was doing. And, uh, at that time, Lehman Brothers went under and you had the start of the global financial crisis.

• 55:42Speaker 01

  And my co-founder Beijou, who was also a math and physics guy, so we bonded over, over that. He got a job at a hedge fund up in Marin County, kind of on a whim. And he calls me up and, uh, convinces me to start a company with him.

• 55:58David Senra?

  And what is that company gonna do?

• 56:00Speaker 01

  Basically, he was hired in this, uh, hedge fund that was doing proprietary trading. So it wasn't really a hedge fund. It was a proprietary trading firm. They were trading the owner's capital and deploying it with computerized algorithmic trading strategies. Essentially, they had a couple of trades that were making money. One of them was, uh, what's called inter-listed arb. And this is the simplest strategy ever. Basically, the way it works is you have a stock that's trading in Canada, Intel, say. And then it's also trading in New York and you have a fast line in between them. So you just buy it where it's cheaper and sell it where it's more expensive.

• 56:41Speaker 01

  And you try to, you know, minimize the latency between the two so that you have less slippage. Well, this company had a pretty fast line between Toronto and, and New York. So they were able to, um, make a lot of money using, using this trade. And then there were a couple of other ones, like there was this market on clothes trade, which literally just traded, uh, it would, it would buy the imbalance heading into the clothes. So it would trade five minutes at the end of the day. And it's again, just a total speed game. So he calls me up and he says, look, I was hired here to be the first quant. I get to see all the traders. I get to see all the engineers. They're running on Windows machines. They've got Java.

• 57:22Speaker 01

  A trade hops through like 30 machines before it gets sent to the exchange. So the original idea that we got started with is can we just like compress that? Can we make it one machine? Can we run Linux? Can we have it on C rather than Java? And maybe we take that 30 millisecond latency down to 10 milliseconds. And if it's a speed game, you know, that, that should win.

• 57:46David Senra?

  But wait a minute, before we get there, like idea aside, think about it, like the jump from, I would say conservative family upbringing in the sense that like your parents took a huge risk by coming to America. But once they got here, they're like, we're essentially gonna stick to one career. Almost, I don't know if the counsel is like, you know, just, just get a normal job. You just said your mom's goal, like just, just go work Goldman Sachs or JP Morgan. It's awesome. Like, yeah, just middle class life, maybe upper middle class. Maybe you save a lot of money. You're a single digit millionaire in a few years, whatever the case is. But you're going from, that's a hell of a jump from math grad student to entrepreneur when you've never run a company before. And you did it. So explain like how you made the decision.

• 58:26Speaker 01

  And it was a hard decision. To be clear, uh, I wrestled with it a little bit. I was like, do I really wanna do this? Well, I was in a fortunate position. I passed my quals my first year. So then, you know, the summer after your freshman year, uh, or your first year, typically you're kind of studying for your quals. So the math department kind of paid you to, uh, study for your quals, get ready for, for the exams, whatnot. But I passed them the end of my first year. So essentially I was being paid to do nothing. And so that was an opportunity to get together and hack on stuff, right? And we rented a little place in the South Mission.

• 59:07Speaker 01

  Me, uh, Beijou and this other kid, Andrew Yarmola, who was also from the Stanford math department with us. And, uh, we got this place in the South Mission. Not a great neighborhood, but kind of fun. And we were just like, uh, building the trading system. That was kind of the goal for the summer. And then my plan was always to kind of take stock of where things were at the end of the summer, see how much progress we made. And, and essentially we'd made very little progress, but we were having a lot of fun and I kind of wanted to see it through. So the idea was we were, we're gonna build this stuff. Then we're gonna go to New York and kind of figure out how to deploy it and trade it.

• 59:47David Senra?

  Yeah, if you were, you just said, I wasn't happy with what I was doing. And now you're having fun, not making much money over the summer. Yeah, it's just like, but that's good enough. Like, so the fact I was having more fun is a good enough reason.

• 59:59Speaker 01

  It didn't seem like I was taking a huge risk.

• 1:00:01David Senra?

  Yeah.

• 1:00:02Speaker 01

  To be honest with you, because the, um, alternative, it's not like I was like killing it, making a killing, working at a cushy job at Google that was paying me millions of dollars a year.

• 1:00:15David Senra?

  You were making $18,000 a year.

• 1:00:17Speaker 01

  $18,000 a year.

• 1:00:18David Senra?

  Turns out if this doesn't work, I can probably find another job that'll make $18,000 a year.

• 1:00:22Speaker 01

  Well, and I was concerned about that actually. So I went to the, the vice chair of the department to ask for a leave of absence. And I was like, all right, I do want a safety net. I'm not gonna be stupid here. I'm gonna go to the vice chair and request the leave of absence for a year. And I was like biting my fingernails off for this conversation. And I still remember it vividly because I planned out my decision tree and I was like, if he tells me he won't approve it, I'll probably stay back and and keep doing grad school. And it was this Russian guy, Dima Shlatenko.

• 1:01:05Speaker 01

  And actually a couple of years ago, I was invited to give the commencement at UCLA math. And Dima Shlatenko was the department chair at that time. So we had this dinner and, and I was like, do you remember that conversation?

• 1:01:17David Senra?

  Changed the trajectory of my life?

• 1:01:19Speaker 01

  Changed the trajectory of my life. And he's like, he's a, he's like, that conversation changed the, it was very memorable. I'm very proud of you. And so he, I, I go into the, his office and he's like, so you want to be businessman, huh?

• 1:01:35Speaker 01

  When I was your age, I also wanted business. I wish you good luck. You do it and we will have spot for you if it doesn't work out.

• 1:01:44David Senra?

  Oh, that's awesome.

• 1:01:44Speaker 01

  So I was like, man, this guy just, yeah, just, you know, gave me a, yeah, safety net. So I felt good.

• 1:01:53David Senra?

  Have you read any of the biographies on Elon?

• 1:01:56Speaker 01

  Uh, some of them, yeah.

• 1:01:57David Senra?

  Yeah, he has a story that he tells in one of them. I think all of the ones I've read about him where I think he was in grad school. I forgot what he was in some kind of school. And he said, I'm going to take a leave of absence. And the guy said to him, you're never going to be back. And he goes, turns out he was right.

• 1:02:09Speaker 01

  Yeah.

• 1:02:10David Senra?

  And I think he left to go do zip two, if I remember correctly.

• 1:02:14Speaker 01

  I took a leave of absence. We put all of our servers and all of our stuff in the back of my 1998 Infiniti Q45 boat of a car. Drive across the country from LA to New York City. For the first year, we were kind of derping around, honestly, try some things. They didn't really work out. And then the year came. And then I remember having this conversation with my mom. I was living in Brooklyn at the time in this like terrible apartment that we were subletting. The bathroom was in the kitchen, sort of thing.

• 1:02:50David Senra?

  Very sanitary.

• 1:02:51Speaker 01

  Yeah, yeah. And my mom would visit me and, and, and she cried. She's like, man, my son.

• 1:02:58David Senra?

  The math genius.

• 1:02:59Speaker 01

  My son went to Stanford. First of all, he went to Stanford and then with great shame, I had to tell people he then went to UCLA. Cause you know, Stanford, everyone knows. And you have to explain the nuance of actually UCLA having a very, very strong pure maths department to people. But you know, at a surface level, it kind of felt like a downgrade, at least to my parents. And now he's borderline homeless. Living in Bushwick, uh, in this apartment that the bathroom's in the kitchen. They're like, are you going to go back to UCLA? They knew about, you know, my one year. I am like, uh, no, I'm having way too much fun.

• 1:03:44Speaker 01

  This is awesome. Who cares that we're not successful?

• 1:03:48David Senra?

  Say more about that. Who cares that we're not successful? Is this, is this when you, you said you started, you found entrepreneurship intoxicating even before you had success?

• 1:03:56Speaker 01

  Yeah, so I think the first, the first experience that I had with entrepreneurship was almost the best parts of doing math, but without any of the bullshit. So the best parts of doing math are that it's just you, your mind, maybe a chalkboard. Now it's a computer, but back then it was just you, your mind, a couch, and you could just make progress. And you actually didn't have to depend on any other people. And of course, when you turn math into a career, it stops being that because you have to go to classes. You have to teach TA, deal with the department administration, all of that shit. But yeah, this was kind of similar in a way. It's just you, computer, you're writing code.

• 1:04:40Speaker 01

  Maybe you have a business that business generates revenue. People want the code you write, but it, it's like all under your control and no boss. You know, no one, no one, uh, no one that you have to deal with. So that was the first time I'd kind of experienced that. And I found that part intoxicating. And now eventually I think it became important for us to earn a living. So entrepreneurship for entrepreneurship sake, um, lasted, that carried me on so far. And then it became about, you know, can we actually create a business that generates revenue that we could support ourselves?

• 1:05:17Speaker 01

  And we weren't quite there at the time I had to make the decision, but I did feel optimistic that we were going to get there. And so six months later, we had a business generating revenue. Uh, and it wasn't the original business we thought of, you know, we weren't trading, but we were selling low latency trading software to other companies. So we had kind of improvised our way to a business. Yeah, it got to maybe 2 million in revenue. We, we hired a small team. We were profitable, growing. We had a path to 10 million or so in revenue. And then I kind of went into my second evolution as an entrepreneur.

• 1:05:59Speaker 01

  The first one was from just enjoying entrepreneurship for entrepreneurship sake to having a sustainable business that could feed, feed me and, you know, my co-founder and our, our employees. Then the second gate was, well, I could grow this business from 1 million to 10 million, maybe, maybe get to a hundred million. But if I had to look back on my life in 50 years, would I be proud of what I was doing? Would I feel like I contributed positively to the world and, and to society and made an impact? And we were selling software to hedge funds who were already rich and making them, you know,

• 1:06:44Speaker 01

  trade a little bit faster and more efficiently. My co-founder and I both kind of realized that, you know, if anything, this was a means to an end. Like we, we didn't see ourselves just really doing this business for.

• 1:06:57David Senra?

  I love the idea that you imagine yourself as an older person looking back on your life.

• 1:07:01Speaker 01

  Yeah.

• 1:07:01David Senra?

  Uh, I think I've heard you say this is like a legacy test. It's like, do I really want to spend the next 30 to 40 years of my life doing this? Like you'd get to the end, like I kind of wasted my life.

• 1:07:10Speaker 01

  Yeah.

• 1:07:10David Senra?

  It reminds me of, um, that famous, uh, conversation that Steve Jobs had when he was recruiting John Sculley from Pepsi. He's like, you want to continue to sell sugar water? You want to come with me and change the world? Like, it's very fascinating, but I, I think this idea that I love, and maybe I'm wrong, but like, looking at the career choice that you're making, the business that you can build, because you're an entrepreneur, you can build whatever business you want. Like looking at it's like, will I spend the next 30 to 40 years of my life doing this? And if the answer is no, you should just stop.

• 1:07:38Speaker 01

  I think another reason why I liked mathematics as a thing to do was this idea of like making a fundamental discovery. And maybe if you make a fundamental discovery that's really big, eventually every child will, will learn about it. Right? It'll be in the, not, not just in the history books, but you know, every child will like learn about the techniques in school. That got me really excited because you, you have both the act of creation of bringing something new into the world,

• 1:08:13Speaker 01

  which, which I find just inherently interesting, but also that there's an impact and you know, it could affect millions of people. And I think that's what got me really excited about the idea that became Robinhood. It's both like a act of creation, something new, fundamentally different, and something that could have like mass scale, that could change the lives of hundreds of millions of people.

• 1:08:43David Senra?

  So it goes back to where this, it's this like tree of our discussion started where you think much more of yourself as like an entrepreneur. You get a lot more satisfaction out of the success you have as an entrepreneur compared to the success you had as an investor.

• 1:08:56Speaker 01

  As a, um, investor, or you mean a founder of a financial company?

• 1:09:02David Senra?

  No, yeah, I mean, you invest as well, but like, yeah, clearly from the discussion we've had, and especially where you just wrapped it up beautifully. It's like you think of yourself much more as an entrepreneur. You ever read Michael Bloomberg's autobiography?

• 1:09:13Speaker 01

  I haven't, no.

• 1:09:13David Senra?

  Okay, so he was in finance and when he got fired, I think from Solomon Brothers, I think it was in like a 1980, something like that. He had like a $15 million golden parachute, which is a ton of money at the time. And everybody, since he was in finance, they thought, okay, you're just going to take that money and live as an investor. And he's just like, no, I want to build something. I want to build a business that actually makes other people's lives better. Talks about it over and over again in his autobiography. It's exactly the story you just told us.

• 1:09:36Speaker 01

  Yeah, I mean, I think the financial aspect is really integrated into my upbringing and identity as well, which is a reason why I care about it and I care about our, our customers. Things are changing very rapidly in this world. I mean, you have AI and it's really changing things for the positive, also making people very nervous. But one thing that's not changing, I'm pretty confident is the importance of, of having money, investing, generating passive income. I think that's never been more important than it is right now.

• 1:10:12David Senra?

  Vlad, you took this discussion in areas I had no possible indication that we were going to go. I didn't even get to half the stuff I want to talk to you about. So I'm going to come back in a few months and then we're actually going to do the how Vlad works episode. But this was awesome, dude. Thanks for the time.

• 1:10:23Speaker 01

  Let's do it.

• 1:10:25David Senra?

  I hope you enjoyed this episode. Please remember to subscribe wherever you're listening and leave a review. And make sure you listen to my other podcast founders for almost a decade. I've obsessively read over 400 biographies of history's greatest entrepreneurs, searching for ideas that you can use in your work. Most of the guests you hear on this show first found me through founders.