I worked at a lot of San Francisco Bay Area startups (aka Silicon Valley startups) There is a really serious elitist attitude here that you have to be l33t and hack the everything in order to hack a startup.
What that generally means, at least in one respect, is that you have to be smart enough and quick enough to take opportunistic advantage of your surroundings: the competitors(aka incumbent disruptees), some compound economic conditions, but also your customers and investors as needed.
I mean sure, I love all these people trying to do something truly better for their customers and break the old and decadent to create the new and efficient. I get that. And I’m all for that.
But, take this example of what happened to me when I tried to transfer some stock out of the Robinhood platform. I initiated a partial account transfer out of Robinhood to E*TRADE because Robinhood could not provide some service regarding those shares. A few days later, half way through setting up a bracket, Robinhood deactivates my account. It canceled every single outstanding trade I had in flight. And it also nicely sent an email for each of those actions, piling up a screen full in my mail client.
Some thoughts race through my mind… shoot! Did I trigger some kind of secretive financial services rule for brokerage firms that warranted Robinhood deactivating my account and reporting me to an anti-illegal-activity agency?? Did they think I was laundering money by transferring these shares in and out? Did they think I was trying to evade tax and report me to the IRS??? Wait! No no, those are clandestine snitching and invisible to me. This type of deactivation with no explanation usually has to be for something that immediately impacts the company’s business.
And then it dawned on me, yes it does affect Robinhood business! This startup lives off DAU’s and subscription fees (and for god’s sake I even bought gold membership just to patronize fellow startup) making it prohibitively difficult to leave its services. It is to its business advantage to do this. And customer is the wiser until he tries to get his money or stock out of the system, and by then, as it is for me, all is too late.
I’m not picking on Robinhood, it’s a great free service. And because it is so great it really shouldn’t have snuck in that hack into it. For goodness sake! I did a partial transfer and left a lot of money and shares in Robinhood so I can continue to trade!
Wait, are they picking on me because of my race? I know it’s really easy to detect that nowadays with their app reporting my location and the spelling of my name… are they picking on me because my account is too small compared to other users?
The support email responded after almost 24 hours. It claims that they do this to everyone: https://support.robinhood.com/hc/en-us/articles/115001535326-Stock-Transfer.
What happens to my stocks during the transfer?
While stocks are being transferred, you’ll be restricted from trading them until the transfer is complete. You still own the stocks during this process, and they’ll update to reflect the current market value.
Their public documentation indicates that only shares being transferred cannot be traded not all shares! And while it took two days for me to receive this information, i hade the time to call E*TRADE twice to confirm that the transfer was indeed a partial account transfer (of just one stock among maybe two dozen that I own at Robinhood)
This reminds me of my own work at other companies… sometimes technological choices render the upkeep of documentation and sprawling knowledge base impossible. But wait… no the support sent me the link so it must be current as of now?
And certainly there are cases where an unnoticed bug prevented some metric driving feature from being disabled by customers in many situations… sure everyone hacks here.
But it doesn’t need to do that! It’s such a great service, free !! I mean how do I even ask for remediation of my trading losses from a brokerage firm that doesn’t charge money to trade? Is the truism “you get what you paid for” really true? And yet I feel outraged. Like I’ve been liked to, like I was cheated out of proper service, I feel like I lost money not being able to execute on my trading plan.
In the mean time, my transfer has not progressed. The share sits in Robinhood inaccessible to me. AND all my other shares at Robinhood are also inaccessible.
When I hack it… if I ever try to hack a startup,… I would never be sneaky in this way. I mean, com’on at least leave the customer and investor out of the con!
I hope by the time this blog publishes the company has either changed its ways or else gone out of business. Deploying this kind of unnecessary tactics to retain customers is just bad.
Haha, just saw Square unapologetically settle a lawsuite for taking gratuities from caviar customers but not passing the gratuities to the couriers(those who deliver the food) or to the chefs(those who cook them) The company insists that it did not confuse anyone that the gratuity was for Square, the S&P 500 public company and not its small sellers or its individually contributing couriers. (Techcrunch article circa 6/11/2018) There was one time when I made an order, there was a mandatory 18% gratuity. I, as a customer of Square’s customers cursed the courier for demanding uch exorbitant tip… Sorry courior.
This drastically lower my already very low esteem for having provided service to this startup. I’ve increased my trust in Square’s leadership and management in the time that I worked for it. I grew to believe that it wanted o empower the economically isadvebtaged and help he excluded inorities. But it is definitely a company that appreciates hackers and engages in this generalized hacking. Specifically, I am not excluding suggestion that it may take significant advantage of its merchants who are economically disabled or members of an excluded minority. Clearly this law suite is one such case. I feel it has taken advantage of participants of this transaction. What it charged should not be called gratuity.
But, as a shareholder, I applaud, as I did at their bi-monthly townsquare all-hands, the dilligence of their legal team for wordsmithing the legal documents to make this “not Square’s fault”… We gladly applaud it even though it is like applauding a democratic politician’s claim “I did not have sexual relations with that women” (…according to dictionary definition of that word) I guess… I mean, I guess we kind of just accepted that and voted red anyways, right? Yay, let me buy some more when SQ drops at this news.
But seriously though! You all startup hackers should be ashamed of yourselves for taking advantage of those poor drivers! Sheesh!!! I’m going to go out and eat at a restaurant and give the server, to his hands, a proper tip! This is a big karmic dent that needs to be patched with certainty.