Reflections on Robinhood’s checking & savings fiasco

We in fintech often confuse Type 1 vs 2 decisions—reversible/not reversible. Robinhood reversed it, yes, but at high cost. As great as tech is, disrupting existing systems first requires wading through minutiae of regs + history.

It’s truly amazing to be part of companies and watch other companies move fast and do incredible things. And perhaps if I were on the Robinhood team I would have come to the same conclusion they did (our hubris will convince us we would “never have done ____________”), but these stories still illustrate to us several key principles:

1. Moving fast is high risk. If you can stomach that risk, great. But be prepared for some decisions to blow up in your face.

2. Ask for counterpoints. Groupthink is deadly. Ask counterpoints from those who agree with you will give you exactly what you expect — not much. Solicit from those who disagree or are willing to disagree.

3. Conduct pre-mortems. While not bullet-proof, when we’ve conducted a pre-mortem (assume your action will fail, and discuss why it did) to poke holes. This helped us identify many of the core issues we would inevitably face. Instead of concluding that “yes, this is awesome” we were able to comprehend, “yes, this is awesome, but _____________” to have a sober, realistic understanding of the land mines that lay ahead of us.

4. Execution is important, but pre-work is even more so. Think of it this way: if you give a presentation on a topic you’ve never spoken about before, where do you spend more time: preparing for your presentation (thinking, slide creation, rehearsing) or the actual presentation?

Sleep on it. I’ve been part of countless decisions where we did “research” (usually about 20 minutes or less). If we only had dug a little bit deeper, we would have realized some glaring issues.

5. Lastly, humility. You are human, you’re far from perfect and you are certainly not invincible. Be the leader who admits they’re wrong, don’t be the leader who is incapable of that.

Published by Jeff Beaumont

I love helping companies scale and grow their organizations to delight customers and employees, enabling healthy teams, fast growth, and fewer headaches. Scaling quickly is wrought with potholes and plot twists. When you’re running a company, losing customers, and employees are on their way out, and don’t have your systems running smoothly, then you’ll be at your wits' end. I've been there and hate it.

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