Businessweek Extra-Webull CEO Anthony Denier

free online trading platform we Ball. Yeah, he also happens to be an Ali Baba Alam and look, we Will also got caught up in that frenzy trading around memestocks like game Stop, AMC and others, just like robin Hood did, right and they put restrictions on trading like after the chaos. And you might recall Bloomberg Business Week we recently reported on the company we Will. Apparently he has been peeling off users from rival robin Hood. It's increased its roster

of brokerage clients. Check this out, Tim, about tenfold last year to more than two million. And that was before all of the craziness around game Stop, which of course we talked about with the CEO. Here's our conversation with Anthony Denier. We did not have a say in the matter. We're an introducing firm. We do not operate our own clearing house, right so we do not put any customer, We do not put any collateral on behalf of customers to settle all the transactions that happened on our platform.

We are simply a portal. So our third party clearing house called me at approximately nine eight a m. And informed me that they may not be able to settle new by orders in three particular names of three most popular ones that were seeing on Reddit. And I had to make the hard decision to send out a message to our users that we are not able to support by orders. Why was that a decision you had to make it? Why was that a decision you had to make? It sounds like it wasn't even a decision like you

had to send that. Well, you're right, I had to send it exactly. I mean I could have. I could have went back to the clearing house and said no, I'm going to keep the orders open, and what possibly could have happened is those trades would have failed, which would have cascaded into a much bigger problem. So maybe you're right. I did not have that did not have a decision of So were what is the issue that needs to be fixed here in order to to to be able to actually make trades when when when your

users want to make trades? What needs to be fixed? Uh? Well, first off, there's a two days to business day waiting period for settlement. Right. The systems that go into settling transactions are very antiquated. To put it lightly, they're working on technology that was built decades ago. Right, it used to be T plus three, now it's T plus two. There is talk that they're gonna work till T plus one.

That's two whole days. That massive amounts of capital need to be allocated as collateral to deal with margin requirements as the DTC clearinghouse. So what needs to be done. We need to implement new technology i e. Blockchain, which has been talked about for a long time. But when you're taking an old system and trying to bring it into the new world, that does take time. Um, So there needs to be technology technological advances in order to ensure that this does not happen again. So that's what

we're trying to get to. Like, what's the problem? Was it? Traders? Individual retail investors, you know, doing something wrong or was it just a case that the infrastructure, the logistics just doesn't quite work as you say, antiquated systems. Is that the problem? Now, that's a that's a loaded question a little bit because on on the surface, I will say that that is the problem. Now, obviously, I think what's going on is a little deeper than just the market

mechanics of trade settlement right now. If you if you want to talk about the story of why specific brokerages stopped the new opening positions or i e. By orders of these specific stocks, yes, it was a market mechanic. It was a lack of capital, right, and fear of

counterparty risk that was the reason for that. But more underlying is why are these masses having a populous movement going against what you know they would call, you know, the institutions, right, the hierarchy, you know, um, you know the suits. There's an unlevel playing field that's been going on for a long time, and firs like weevil have been aggressively trying. We've been trying since we started two and a half years ago, open up the playing field.

I don't I'm not even gonna evolve using the word democratization because it gets used too much. We're giving access two uh, not only tools, but access to markets and trading strategies that retail investors had never had access to, right, or they did have access to they had to have huge amounts of capital at the firm, or they had to pay ridiculous fees a platform fee, subscription fees, or commissions. And we removed that and that started. That started the trend,

and now they want the playing field level on all levels. Right, Why does what is institutions get the ability to have a ten x leverage capability with portfolio margin where regulation stops a retail investor from two x leverage. Well, you know someone would say, forgive me not my words or my assessment, but smart investor versus dumb investor. Do individual retail investors really understand the implications of that kind of leverage. I think they're really starting to. And like I said,

it's been listed. Um hey, Anthony, give us some numbers from from this week. I mean, what kind of increase in action did you see on the platform? We saw some of these trading apps moved to the top of the iTunes app store, so obviously there was a lot of activity. Yeah, um, a lot of activity is probably

putting it lightly. Um. We've we've been very fortunate to have to be growing at a at a very fast pace over the course of the past year and a half, in particularly coinciding with the whole retail trading world going to zero commission. It opened up retail investing to a whole new demographic of user. Most of those users were app based users, right, we are an app based platform. Are demographic kinds of skew younger because we are so app specific. Um, So we've been very fortunate to have

good growth numbers. Now that this, you know, this movement has gone viral, so to speak, it's reopen that it's the new reawakening of zero commission. It's people realizing that, hey, I can take control, I can make changes, I can improve the system. So we went from you know, I we you know, I would look and scroll in the finance category of app on the App Store, whether it's Android or I RLS, and you know, I was getting

I put up a couple of posts. I was really excited because we made the top ten in the finance section. We were nowhere near in the top thirty for overall apps compared to like TikTok and Zoom and Instagram and and now if you look for the last couple of days, it's been Robin Hood's number one. We will number two and read it number three, which tells the story of what's going on. So bottom line twenty seconds. It's just made you even that much more popular. It has increased

our popularity. Um. It's also increased our need to make sure that customers are informed, educated, We're transparent about what we're doing, why we're doing it. Um. You know, these are things that that make a successful product. So you've grown. Can you give us a number? Just are you get fishing for a number? Are number number number two in the app store? That was we will CEEO Anthony Denier.

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