Robinhood Markets Inc. (NASDAQ: HOOD) has laid off 23% of its staff, after firing 9% of people earlier in the year. CEO Vlad Tenev wrote: “In this new environment, we are operating with more staffing than appropriate. As CEO, I approved and took responsibility for our ambitious staffing trajectory—this is on me.” It is cold comfort for the roughly 1,000 people who are out of work.
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Robinhood management gambled that people would continue to trade via its easy-to-use smartphone app. That was true for several years. Tenev did not see that there was a change coming, even though he had 21 million users of the platform he could have polled. Clearly, he did not do customer research that would have been simple.

In the most recently reported quarter, Robinhood revenue fell 44% to $317 million, a remarkably small sum for a company that was once worth tens of billions of dollars. The net loss was $295 million. Oddly, Tenev had only positive things to say about the quarter. One of the triggers for the loss was barely acknowledged. Cryptocurrency price declines were partially to blame for the dismal figures.

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Tenev is hard to fire. He is a co-founder and a large shareholder. However, lead independent director Jonathan Rubinstein could ask the board to insist on Tenev’s resignation. Another reason he should be pushed out is that the stock is down nearly 80% in the past year. Any other public company board would take this as a primary reason for new management.

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