Optimism reigns at consumer trading services as fintech VC spikes and Robinhood IPO looms

But services that help consumers trade might need to retool their models over time to ensure long-term income

With the Coinbase direct listing behind us and the Robinhood IPO ahead, it’s a heady time for consumer-focused trading apps.

Mix in the impending SPAC-led debut of eToro, general bullishness in the cryptocurrency space, record highs for some equities markets and recent rounds from Public.com, M1 Finance and U.K.-based Freetrade, and you could be excused for expecting the boom in consumer asset trading to keep going up and to the right.

But will it? There are data in both directions. While recent information could indicate that some of the most lucrative trading activity at companies like Robinhood could be slowing, there’s also encouraging app download information that paints a more bullish picture regarding the durability of the boom in consumer interest regarding savings and investing, which The Exchange has had an eye on for some time.

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Our question today is this: How bullish are companies in the space about continued consumer interest in equities and other asset trading? And why? We’ll also put similar questions to their backers.

We’ve compiled notes from Accel’s Sameer Gandhi about views concerning Public as one of its backers and Index’s Jan Hammer about Robinhood and its market, as well as comments from Public.com and M1 Finance about what they see regarding consumer trading interest in the future. Thoughts from Robert Le, PitchBook’s senior emerging technology analyst, cap things off.

We’ll start with a short look at some data to help ground ourselves regarding where consumer trading demand appears to be today, then consider what the companies in the ring and their backers are thinking. We’ll close with a synthesis of all the perspectives to come up with hype-adjusted expectations for the rest of 2021.

Bullish data, bearish data

Coinbase executed its direct listing on the back of one of the most impressive quarters we’ve ever seen in the realm of business results, meaning it began to trade when it looked just about as good as a company can. Will the same hold true for Robinhood and company?