🎧🍌 Robinhood Co-founder Baiju Bhatt on the Journey to $40B, Building Space Solar Power with Lasers
Going zero to one building physical products, floating space solar farms, the value of creativity and design, combining qualitative and quantitative user research, and Robinhood's accidental launch
You’re probably familiar with Baiju Bhatt’s work as the co-founder of Robinhood, which has since grown into a public company worth $40B. But he’s also obsessed with space, and recently started Aetherflux, a space solar power company.
This conversation gets into the physics of using lasers to beam solar power to the Earth. We talk through Aetherflux’s early roadmap, and how Baiju went from zero to one building physical products.
We also talk through the early days of Robinhood, getting turned down by hundreds of early investors, the accidental launch, how to know if you really have product market fit, when Aaron Levie at Box helped get Robinhood[dot]com, the value of creativity and design, Baiju’s philosophies on combining qualitative and quantitative user research, and his favorite animal and classic car. He also tried to cut my hair.
I personally think this is one of the best episodes of The Peel to date - please enjoy, and I’d love to hear your feedback!
Timestamps to jump in:
2:31 Aetherflux: a space solar energy company
2:50 Origins of space solar power in the 40's & 70's
10:31 Safely beaming energy from space to Earth with lasers
13:46 Building floating space solar farms
21:27 Aetherflux's early roadmap
27:08 Growing up with dad as a Physics professor
32:18 Going zero to one building physical products
35:15 Baiju's favorite car, attempting a haircut, contemplating mustaches
38:27 Trying to prove Einstein wrong
41:42 Meeting Robinhood Co-founder Vlad at Stanford
44:10 Starting an algorithmic trading company
46:41 The beginnings of Robinhood
52:04 Getting turned down by hundreds of early investors
56:49 How they convinced Tim Draper to invest
59:39 Getting Robinhood.com because of Aaron Levie
1:01:28 Accidentally launching on a Friday afternoon
1:03:09 How to know if you have Product Market Fit
1:06:35 Combining qualitative and quantitative user research
1:14:23 Loving cats despite being allergic
Referenced:
Aetherflux launch coverage on TechCrunch
Seinfeld mustache scene
The Peel episode with Aaron Levie, Co-founder and CEO of Box
Find Baiju on X / Twitter and LinkedIn.
👉 Find on Apple, Spotify, or YouTube
Transcript - (read on Rev)
Find transcripts of all prior episodes here.
Turner Novak:
Baiju, welcome to the show.
Baiju Bhatt:
Thanks, man. Thanks for having me.
Turner Novak:
So we're going to talk about two probably big topics. We're going to talk Robinhood, which founded that, spent a long time starting something new though now.
Baiju Bhatt:
That's right.
Turner Novak:
It's called Aetherflux.
Baiju Bhatt:
Yep.
Turner Novak:
What is that?
Baiju Bhatt:
Yeah. Aetherflux, new company I'm starting. Mission of the company is to try to do something pretty bold, to take this old idea from the pages of science fiction to make this thing a reality. So the idea is to make, to find the path, to make space solar power a reality. So what is space solar power? It's this old idea from the 1970s. Actually, arguably from the 1940s there's an old Isaac Asimov story that first talked about this idea, but the concept in the 1970s were what are the emergent energy methods of generating energy that we think are going to be relevant for the next generation of humanity?
And so the ideas that came out of that were things like fusion and space, solar power. And so what space, solar power as an idea is what if instead of collecting solar power on the surface of the earth, you were to collect that in space.
Turner Novak:
Why is that a big deal?
Baiju Bhatt:
The benefits of this, the original concept was you would build one monolithic array in geostationary orbit. So pretty far from the surface of the earth, about a 10th of the weight of the moon. And there you would build one monolithic array which would face the sun and collect solar power. And when it collects that solar power, it turns it into another form of or photons. So in this case, microwaves. So think the electromagnetic radiation that we use for telecommunications and pushing a beam of that through the atmosphere to a ground station to collect power.
Now, this is a very cool idea and the benefits of this would be if you're in geostationary, at least you'd be nearly continuously sun facing. And so you would be able to address one of the main problems with solar power, which is that it's intermittent because you get solar power when the sun's shining.
Turner Novak:
Yeah, which depending on where you are, might be 5, 10, maybe 50% of the time if you're lucky.
Baiju Bhatt:
Yeah. And it's also when is that solar power available, right? Because solar power is peaked at lunchtime, right?
Turner Novak:
Yeah. So even if you're facing the sun, you might only get half of the power that you could possibly get from it.
Baiju Bhatt:
At least on the surface of the earth. And so if you could get it continuously in space, that would be huge. And so the idea then was if you put this thing in a geostationary orbit and you used microwaves to transmit the power, the benefits of this would be it would transfer through the atmosphere largely unimpeded. One of the, I think things that prevented this concept from the 70s from becoming a reality was that everything was enormous. So the aperture size and space would be the size of a small city like your aperture size. And when I say aperture size, I'm talking about how big is the thing that's transmitting or receiving power.
Turner Novak:
So you needed to have these massive city scale seven by seven mile structures in space?
Baiju Bhatt:
Yeah, like 500 acres in space. And so the question is, well, that's a cool idea, but how does humanity do this? And I think that that has been where that idea has lived for a long time. And so it's this very cool idea. I think the motivation behind it is pretty well founded, but it never happened. And so the idea behind Aetherflux is we want to take this idea and make it a reality.
And the way we want to do it is to find what is the direct path towards it? What's the path that we could do it with today's technology? And so our approach, this is not our grandfather's space solar power approach, let's say.
Turner Novak:
Wait, so what's the grandfather approach?
Baiju Bhatt:
It's this approach that I'm talking about, this old 1970s monolithic array-
Turner Novak:
Massive. Okay.
Baiju Bhatt:
Instead, our approach says, hey, what if you could make everything smaller? Is there an architecture that leverages the way that we build technology today, which could make this much more possible? And so what if you could build a constellation just as a starting point?
Turner Novak:
So this is a constellation of satellites or floating solar panels or satellite solar panels?
Baiju Bhatt:
Yeah, floating solar farms. Could you generate power like that? And if you did that, what method of power transmission would you use? So our basic architecture is instead of using a monolithic array, we're going to build a constellation of smaller satellites. Each one generates power and then transmits that power down in the ground.
Instead of using a phased array of point antennas that use microwave radiation or radio waves, we want to use collated lights. So beams of infrared lasers instead. And the benefits of this are you make everything smaller. So by using lasers for power transmission, we actually can get a much smaller spot on the ground.
Turner Novak:
How does that compare old approach versus current laser approach?
Baiju Bhatt:
So we're talking like a spot size on the ground that's maybe 100 acres or 500 acres.
Turner Novak:
That's what was needed previously?
Baiju Bhatt:
Versus we think for first mission, we're targeting say 10 to 20 meters diameter on the ground. We think we can actually get that smaller sub 10 meters.
Turner Novak:
Is that like a building or less than that even?
Baiju Bhatt:
So imagine a power receiver that's not huge, eventually the Starlink ethos of you can get power wherever you want in the world. And the benefits of this would be you lay out a ground station and it forms a link with one of the satellites that's passing overhead. And as it's in the field of view, it points down at the ground station and once it forms a lock with that ground station, we'll transmit power.
So we're going off on a couple of tangents here, but the basic idea is to take this concept of space, solar power and say what's the way of doing it that we think is the most straightforward path towards demonstrating it with today's technology? And how do we find an architecture there that we think we can scale out to providing useful power for applications?
Turner Novak:
So it's figuring out how to commercialize this versus just science project or science fiction?
Baiju Bhatt:
Mm-hmm.
Turner Novak:
Make money basically?
Baiju Bhatt:
So this is another way of saying it, we want to take this concept from science fiction and make it reality. We also want to commercialize space solar power, and this is one of the thesis behind me wanting to do space other than the fact that I just-
Turner Novak:
It's pretty cool.
Baiju Bhatt:
Space is really cool and I've wanted to do it my whole life, is this thesis. And I know we're going to talk about Robinhood in the future, but it's this thesis that if you can create more economic opportunities for people or if you're creating products or services that create different ways for people to pursue their own self better meant to make money that, one, that's really special.
Two, those are the circumstances where the rate of progress, the best way I can describe it is it's hard to see how quickly things progress. When I look at the space industry, there's stuff that humanity does in space right now. We do telecommunications, we do earth imaging. There's lots of defense applications in space, but I think there's room for more, right? I think there's room for distinct applications in space, and I think one of the first ones is energy and hence building an energy company.
Turner Novak:
So I think one of my biggest questions when I was looking into everything that you're doing, you're beaming extremely concentrated shot of energy down at the earth. Kind of sounds unsafe. Is it safe? How does that all work?
Baiju Bhatt:
So safety is big part of what we do. One of our first hires of this company was our safety officer. The basic concept behind this is that you have a satellite in space. The way we're contemplating this going to work is as the satellites passing overhead, it will look for the ground station and before it starts sending power, it'll establish a link between the ground station and the satellite. So imagine a heart beating between the two of them.
And the idea is that that connection is one of several layers of safety interconnectivity we have between the ground station and the satellite. As we build this, that safety system is going to take into account safety for birds, safety for spacecraft, safety for aircraft in the vicinity, for humanity, sorry, for planes, wildlife, the whole spectrum. And there's established standards to work within to do that.
But the idea is to actually build a system that's able to safely form a connection between the satellite and the ground station, monitor that connection as it's connected, and then when it sees a clear path to transmit power. And one of the benefits of the way that we're doing it is that it's a tight beam of light, meaning the goal of this is that we're able to impact that power beam onto a fairly small area, and in turn we won't have stray light going to places. You know what I mean?
Turner Novak:
So for people listening and not watching and didn't see motion you just made, how big of a beam? Are we talking a mile wide? Is this a couple inches?
Baiju Bhatt:
Yeah, so this is the thing, right? Is we want to target a spot size on the ground. At first it's going to be low double digit meters in diameter, but we think it's going to be able to get down to the 5 to 10 meters in diameter on the ground. That's not that big. And when you think about it, well, on the ground, that's the size of a roof. But if you think about it from the context of space, you're talking about trying to point at this thing from 550 kilometers.
Turner Novak:
That’s hard. It's like playing the hardest video game on the hardest difficulty.
Baiju Bhatt:
Yeah. But we do crazy things with technology. The technology to do stuff like this we think is out there and we're building right now.
Turner Novak:
So how long is it going to take you to do all of this? Do you have thinking around, all right, 2026, we'll be here, 2030, we might be here. How are you thinking about all that?
Baiju Bhatt:
Yeah. Okay, so this comes back to what we were saying in the beginning, which is what's the motivation behind doing this? And it's to find a direct path towards demonstrating this. Space solar power is not a thing. We don't power stuff on earth with space solar power, and the first thing that has to happen is we have to break ground there and we have to demonstrate a first, this is what power from space looks like.
It's not going to be a ton of power at first, but you have to think about what's the proof of concept of the technology, and then there's a distinct thought of how do you scale this to meet the applications of providing power to remote location all the way up to the broad ambition of how do you power humanity?
Turner Novak:
Like a home or a downtown or something?
Baiju Bhatt:
I mean cities, states, nations, the whole world. That's the big broad ambition. So we're not going to do that first. So the question is how do you distill that down to a first-
Turner Novak:
Yeah. Do you have an idea of the first thing we're going to try to do?
Baiju Bhatt:
Yeah, so this is what we're working on right now, and that path is basically what is the path to do this with stuff that's either commercially available right now off-the-shelf, let's do some custom stuff, but let's really keep that to the stuff where we have to do it.
How do we demonstrate this capability using technology that exists today? So for example, for power transmission, we're using infrared lasers. If you think about, well, I'll tell you what the broad architecture stack is for the first mission that goes up beginning of 2026.
Turner Novak:
Okay. It's really a year away.
Baiju Bhatt:
Yeah, we got a lot of room to do for the next year, but you can think of it as like, well, what are the big components of this mission? Well, first part is the SpaceX rideshare, that's commercially available. We bought that, which what an amazing company.
Turner Novak:
So this is a, you get a ride on a SpaceX rocket, it shoots you up and you got your first satellite in orbit?
Baiju Bhatt:
Yeah.
Turner Novak:
Okay.
Baiju Bhatt:
I call it the laser barnacle.
Turner Novak:
The laser barnacle, because you catch a ride, yeah, like a barnacle.
Baiju Bhatt:
Yeah. You're hanging on the top of the, you're inside of the fairing, but you're just like, you're bolted onto the-
Turner Novak:
I could just see the little thing bolted on the side of the SpaceX rocket as it's taken off.
Baiju Bhatt:
Yeah, I mean-
Turner Novak:
Is it actually going to look like that?
Baiju Bhatt:
I think it's going to be about the size of this table bolted to the side of the, not to the outside of the rocket, just to be clear.
Turner Novak:
Okay, okay. I was like, that sounds crazy, but okay.
Baiju Bhatt:
No, there's a big fairing on top of it, but there is still a mounting structure inside.
Turner Novak:
Okay.
Baiju Bhatt:
Hence the barnacle.
Turner Novak:
So will you ride on a ride? It's like a rideshare almost in space, but are there going to be multiple other payloads potentially on that ship?
Baiju Bhatt:
Yeah.
Turner Novak:
Okay.
Baiju Bhatt:
They call it a rideshare.
Turner Novak:
Interesting. Okay. How many different things might go up in one SpaceX launch? One or two, three people, is it potentially a hundred different satellites on a trip?
Baiju Bhatt:
I don't remember what the number is. It's not two or three, and I don't think it's a hundred. I think it's somewhere in between.
Turner Novak:
Interesting, huh?
Baiju Bhatt:
Yeah.
Turner Novak:
And so that's one of the things you're thinking is we basically, were creating a railroad to get into space, a transportation channel to get commerce.
Baiju Bhatt:
SpaceX is doing that for us.
Turner Novak:
Yeah, yeah. Okay.
Baiju Bhatt:
But that's from the point of view of commercially available, rides to space are available commercially. You don't have to build a rocket to do that.
Turner Novak:
So before SpaceX, if you wanted to get something into space, did you work with NASA or, I think there's some satellite internet companies, maybe one or two publicly traded ones where they'd put a satellite in space and you could get satellite internet on your aircraft, on your Delta flight or whatever. So there was a little bit of stuff happening, but I know it was, we'd launch one a year or we'd be planning our launch three years out, so it was probably a pretty big deal to the extent now SpaceX does multiple a week, right?
Baiju Bhatt:
Yeah.
Turner Novak:
I think, and their run rating soon every day.
Baiju Bhatt:
They also have rideshares a year.
Turner Novak:
That's awesome.
Baiju Bhatt:
I could wax poetic about how impressive SpaceX is ad nauseum, but so back to the point of what's the first mission? This is trying to paint the picture of the earnest pursuit was like, how do you do this? There's so many ways to do this where you're not going to have this happen for a decade. You can certainly create a system design here where you have to go and invent something new before you do it. This is not the goal. So one part, ride to space, you can buy it.
Turner Novak:
You got your satellite up there, it's floating. What happens then?
Baiju Bhatt:
Second part is a satellite, you can buy that. So we bought a satellite bus from a company called Apex in which I'm a small investor, and so we're building on top of that. Again, that's commercially available. We were able to accelerate so dramatically because of that and great company that's fun to work with them. And then the actual power transmission laser system, these high power lasers at the frequencies that we're operating, these are out there, right?
Turner Novak:
Really?
Baiju Bhatt:
There's actually one in that lab over there, really a test unit. Yep.
Turner Novak:
So you can just get them off of Alibaba, AliExpress, where do you get them from?
Baiju Bhatt:
It's way more complicated than that. There's manufacturers that make them, and then you can buy one, but you're not going to fly that thing. There's a whole different process for getting it ready to work in the space environment. But again, these things exist. We bought one, it's in there, right?
Turner Novak:
So you hook it to the satellite?
Baiju Bhatt:
We have to engineer the whole thing together, and the last is the ground station and the ground stations are the simplest version is solar panels, batteries, and some other optics like simple reflecting optics, and these are the pieces you need to do this. We are not talking about creating some exotic state of matter here to do this. We're not talking about manufacturing carbon nanotubes the size of a space elevator. We're talking about buying pieces and engineering them together.
And the reason I think this is really important is I think that's the engineering approach to this, which is how can you do this in a way that doesn't require a string of breakthroughs versus how do you improve on stuff that exists today? That leads to the second thing, which is how do you design a sequence of launches like this where for the first mission, the goal is to demonstrate power transmission.
Turner Novak:
So it's just, does it work? Can you-
Baiju Bhatt:
To demonstrate.
Turner Novak:
... make it happen?
Baiju Bhatt:
Yeah, and to actually rectify the power on the ground to show that that power is useful for something, but keep the requirements simple and from that ladder up to higher power, more constellation stuff, there's going to be a myriad of other things that we want to test that follow on that. But again, as an entrepreneur, my mindset was what's the most direct path towards doing this and how do we do that directly as opposed to go through the cycles of iteration without actually building the real thing? Because I think you learn so much more when you do the real thing.
Turner Novak:
And what is going to be the first test? Are you doing, are you working with a hospital, a family, the military? Is this going to be in middle of the U.S., middle of Antarctica? What are you thinking about site and partner?
Baiju Bhatt:
Yeah, I think demonstration will probably be done pretty closely with DOD partners, probably will be hosted in a no-fly zone. So think places like White Sands, New Mexico.
Turner Novak:
Is this because it's just less risk? No-fly zone is just there's less complications in the air?
Baiju Bhatt:
Yeah, also we're planning on serving military applications with this as well. So think getting power out to the forward deployed bases. When we think about how do we achieve this really broad goal of providing power for all kinds of real world applications, the first part is how do we match the thing that we're building to the market that needs it the most, right?
Turner Novak:
And isn't the U.S. military the number one consumer of fuel in the world or some insane stat like that?
Baiju Bhatt:
I don't know if it's the number one consumer of fuel, but I think the U.S. military is the biggest consumer of energy in the government, if I'm not mistaken.
Turner Novak:
Okay. That would possibly be the world too, I guess.
Baiju Bhatt:
Yeah, I know they use, I think, well, we can just double check this number.
Turner Novak:
Are we fact checking?
Baiju Bhatt:
Yeah. Hey Jack, how much does the DOD spend on fuel a year? I want to say it's 14 and a half billion, but I want to make sure.
Turner Novak:
14 and half billion on fuel a year?
Baiju Bhatt:
I want to make sure it's $14 and a half billion dollars, not 14 and a half billion gallons. I remember the number.
Turner Novak:
Which would be more, it'd be a big number.
Baiju Bhatt:
I just don't know which the unit is.
Turner Novak:
I think I actually.
Jack:
Billion dollars.
Baiju Bhatt:
There you go. $14 billion on energy per year.
Turner Novak:
So one customer, take a hundred percent market share with the customer, that's $14 billion in revenue?
Baiju Bhatt:
That's a huge market.
Turner Novak:
That's a massive, that alone.
Baiju Bhatt:
We could take a small percentage of that market share and build a very meaningful business. So that's the place to start. And how much energy does the world use in a year?
Turner Novak:
It's like 10% of GDP or something.
Baiju Bhatt:
That's a huge number.
Turner Novak:
I don't know what it is, but it's massive.
Baiju Bhatt:
And the way that we think about it is those DOD applications are for deployed bases.
Those are the places where it's hardest to get fuel. It's the most dangerous. Those are the contested environments.
Turner Novak:
True, yeah.
Baiju Bhatt:
What we're building we think has some pretty inherent advantages. I'd say one of those is that these ground stations, if you think about the size that we want to get to, these are intended to be portable, meaning you could have a more powerful one that's like a semi permanent installation. I can also imagine a world in the future where if we're able to get the optics to be even more performant, that we're able to make the ground stations entirely portable, where you might be able to take a ground station, package it up and have troops carry it into a contested environment, lay it out, generate power, and then package it back up.
Those are some of the benefits we get from the high level architectural designs. Because again, we're transmitting power a beam of power with lasers that inherently means that the spot on the ground is going to be tightly concentrated.
Turner Novak:
And I guess, just to wrap it all up and succinctly describe it, the thing that's on the ground is basically a solar panel and you're just beaming an extremely concentrated, powerful ray of light that just, it's like the most optimal way of delivering solar energy?
Baiju Bhatt:
Mm-hmm. And the cool thing is that the thing you care about here is what is the power density on the ground and you want to have high power density if you want energy to be useful. So that's actually one of the key parts of this architecture is if you push a bunch of energy down to the ground, but your receiver is absolutely enormous, it's going to be very diffuse and you're going to have to have a ton of infrastructure to be able to rectify that power. You want to have that infrastructure on the ground be compact.
Turner Novak:
And then thinking beyond military purposes, defense purposes, everybody uses electricity, every single person-
Baiju Bhatt:
Everybody, mm-hmm.
Turner Novak:
... in building, and so that's probably not next year, but a couple years in the future.
Baiju Bhatt:
That's what we want to build to, yeah. And I think also in the process of, again, the goal is to get iteration cycles and that's the reason why we're trying to do a first version of this pretty quickly. I think also the thing is it's the process of developing this technology that you figure out exactly how to build it. Just a simple analogy, I don't know if you've seen that little picture on the internet of the versions of the Raptor engine where the-
Turner Novak:
Oh yeah.
Baiju Bhatt:
... first version is-
Turner Novak:
Smaller and smaller?
Baiju Bhatt:
Yeah, the first version looks like a spider web. The second version looks like a slightly cleaned up spider web. The third version just looks like, holy cow, this just looks like the final version of this. It seems like the ideal version doing this, a little bit of that is right now we're building the spider web and it's inherently through building the complicated version, the one where you don't know all the answers, where you learn a bunch of stuff by doing it and doing it again and doing it again that you get the clarity to what that final state is going to be.
Turner Novak:
Well, speaking about learning things, doing things over and over again, how did you first get into physics and building stuff like this? What's the story there?
Baiju Bhatt:
Yeah, I've loved physics my whole life. I grew up with it as one of the big backdrops. My dad was a physicist.
Turner Novak:
Really?
Baiju Bhatt:
That was the reason my family came to the U.S., and my dad had wanted to study physics his whole life, which was a cool story. So he was like the one kid in, this is the story he tells me. He was the one kid in the town that he grew up in that was always trying to come to America to study physics. He was like-
Turner Novak:
Was that not a thing back in-
Baiju Bhatt:
No, it was from Bhavnagar in Gujarat in India in the 1970s and 80s.
Turner Novak:
Okay.
Baiju Bhatt:
Yeah.
Turner Novak:
What did kids aspire to be?
Baiju Bhatt:
My grandfather in India was one of the first Western trained eye doctors.
Turner Novak:
Western trained eye doctor? Oh, Western trained?
Baiju Bhatt:
Yeah. He was an optometrist, so that was the thing is all of my grandfather's children were going to go into optometry. My dad was like, "I want to study physics." As one does and did still go into optometry, he was a contact lens person in India for a long time. I guess, that's optics, isn't it? This is all a little eerie. I realized my dad was doing optics and now I'm doing optics too, weird.
Turner Novak:
It runs in the family, you can't get away.
Baiju Bhatt:
It runs in the family, yeah.
Turner Novak:
It was destined.
Baiju Bhatt:
So that's what he did in India and was applying to PhD programs to study physics in America, and famously was like, "I'm not going to get married because I want to devote my life to science." That did not work out well for him. He also said he wasn't going to have kids, did not work out well for him.
Turner Novak:
Nothing ever goes as you think, never goes to plan.
Baiju Bhatt:
And so he ends up getting married to my mom. My mom was pregnant with me. My mom did not want to come to America.
Turner Novak:
Really?
Baiju Bhatt:
Had no interest in coming to America because they both come from big families in India and my mom was the youngest. My dad was also the youngest, but my mom was going to stay and stay with her family in India. Lo and behold, my dad's got in and my mom was originally going to stay back in India. The story goes, they go to the embassy, they see that my mom is pregnant. They're like, "Cool, your son's coming to America."
Turner Novak:
Wow.
Baiju Bhatt:
That's how, this is going - You said you wanted to talk for a while, so I'm giving you a long version.
Turner Novak:
This is a long version. Yeah. Well, I guess, the TLDR then is you landed in the U.S. and your dad was a physicist at university, I think you said?
Baiju Bhatt:
University of Huntsville, Alabama.
Turner Novak:
Which is that one of the NASA sites, one of the kind HQs?
Baiju Bhatt:
Yeah, I think so. There was a bunch of changes that happened in the 80s or 90s, around that. There was some NASA program, I think around that time, and I think the Reagan administration changed something, but there's a lot of aerospace activity in Huntsville, and then my dad ends up and gets a job at NASA at Langley Air Force Base. So that's where I grew up with my dad working at NASA, and I always remember going to see his, there were those giant wind tunnels at Langley Air Force Base, which I have...
Turner Novak:
The testing where they would test aerodynamics and all that stuff?
Baiju Bhatt:
Yeah, yeah.
Turner Novak:
Okay.
Baiju Bhatt:
Seeing that stuff as a kid, right? It's like these magical facilities to test this crazy aerospace stuff. It really, really left an impression on me, and I studied physics at Stanford. I went on to basically pursue this. Lo and behold, had a little bit of a detour in my professional career. I went into finance, which we can talk about what that journey was like, but I'd grown up around this my whole life and I had this desire to want to leave a mark in this deep science space physics industry, and I think growing up in that generation, you look at what the aerospace industry was when we were kids and you hear about the moon landing and you hear about all this stuff.
Turner Novak:
That was legendary American lore, right?
Baiju Bhatt:
Yeah.
Turner Novak:
The moon landing was one of the most significant moments in human history probably.
Baiju Bhatt:
But that shit happened before I was born, and it was always this weird thing where it's like, did space exploration already happen? Because it didn't feel like we did enough anyways. I had had this passion for space and I told myself that I was just very curious about commercial space flight and that if that was emerging and becoming a thing, I was like, at some point I want to be a part of this.
Turner Novak:
Well, so I think then it's an interesting transition of you were, we'll talk about the software finance detour, but there was a point where you're like, "Okay, I want to start applying some of this physics. I know I want to go from zero to one on just building physical things." I know there's a lot of founders listening that are, they're going through similar process right now. How did you do it?
Baiju Bhatt:
I built a car. Was this during COVID? This was during COVID, yeah.
Turner Novak:
Okay, how'd it go?
Baiju Bhatt:
It works. It's good. Yeah. It's a company called Factory Five Racing. You ever heard of that?
Turner Novak:
Never heard of it.
Baiju Bhatt:
They're based out of Massachusetts. They make kit cars of old Shelby race cars.
Turner Novak:
Okay, so you get a kit and you assemble the car?
Baiju Bhatt:
Yeah.
Turner Novak:
Okay.
Baiju Bhatt:
But it's not like a Lego assembly. All the pieces don't fit together nicely.
Turner Novak:
Is it like welding? Is it fastening harness stuff?
Baiju Bhatt:
There's a lot of fastening stuff. There's a lot of metal shaving. There's a lot of getting electrical stuff to work. I didn't have to do any welding on that one, but there's a lot of fluid dynamics. There's a lot of machinery, and it's also just, I always thought the little stuff with that was really cool, which is when you're putting a piece together and you've got a torque spec where it's like tighten this thing up to this torque requirement and use this kind of bolt or use this kind of thread locker. I was just like, "Why? What is the material science here? How did they come up with this metal and this torque number?"
I always remember being very curious about that kind of stuff, which was probably the beginning of me asking the question of, okay, I can do it. I can physically assemble a thing, but why these choices? Why does it work like this?
Turner Novak:
So do you recommend to somebody that wants to get into this, buy a car kit and build a car?
Baiju Bhatt:
I think that if you want to build space hardware, I think that might be the single best way to do it.
Turner Novak:
Really? Okay.
Baiju Bhatt:
I'm joking around. I say that because I think that's what got me into it.
Turner Novak:
Yeah, I'm sure there's someone else listening. There's probably people listening to this that are thinking both sides. Most ridiculous thing I've ever heard. Probably some people are like, "That's also what I did."
Baiju Bhatt:
Yeah, it really captured my imagination. I really, really enjoyed the creative process.
Turner Novak:
Do you get any creativity in that or is it like a Lego instruction like, here's what you need to do?
Baiju Bhatt:
There's the assembling the thing, which is you don't want to be creative and not torque something up, that's a...
Turner Novak:
Yeah, mangle the part.
Baiju Bhatt:
Yeah, no, I think the creativity comes in what engine do you put in it? What are the components? How does it work the way that it does? Are you using power steering or are you going for a manual steering rack, all the way to what is the design of the finished product look like?
Turner Novak:
And are you a big car fan? Do you have a lot of cars? Do you like cars?
Baiju Bhatt:
I love cars.
Turner Novak:
Yeah.
Baiju Bhatt:
I love cars.
Turner Novak:
What is your favorite car, whether you have it or not?
Baiju Bhatt:
Yeah, I'm trying to think. If I had to pick one favorite car, I'd probably go with a 1973 Porsche, 9 RS.
Turner Novak:
So a classic?
Baiju Bhatt:
Yeah.
Turner Novak:
Okay.
Baiju Bhatt:
Yeah. I like my car's old and stinky.
Turner Novak:
Old and stinky. Yeah, I won't make any jokes from that.
Baiju Bhatt:
Are you saying I'm old and stinky?
Turner Novak:
No, I was like, someone always say, I like my, something like this and say, oh, just like I like my, blank. I couldn't think of anything.
Baiju Bhatt:
I thought you were saying I was old and stinky. I was like, "My goodness, that's rather forward of you."
Turner Novak:
No, I was going to say actually it feels like you always have had very regal haircuts. It's one of my friends. Do know Jaren Glover?
Baiju Bhatt:
Yeah.
Turner Novak:
He's like, you got to get him to talk about how his hair is always so good. Has that been a thing?
Baiju Bhatt:
Talking about how good my hair is?
Turner Novak:
Or having-
Baiju Bhatt:
Or having really good hair.
Turner Novak:
... caring about your hairstyle? It feels like your hair has always been very put together.
Baiju Bhatt:
Jack, how do you feel about my hair?
Jack:
The hair has had many different evolutions.
Turner Novak:
"Many different evolutions," Jack said.
Jack:
It's like been, very small.
Baiju Bhatt:
Yeah, it's been extremely small in the past.
Turner Novak:
Extremely small?
Baiju Bhatt:
Very small.
Turner Novak:
Okay. Well, I'm also going through my first real hair style evolution.
Baiju Bhatt:
You got some good hair on at the moment.
Turner Novak:
Yeah, I let it, it's like if I let it grow another three months, it'll start looking like a mullet. I think I'm in the early stage. I got it trimmed up a little bit. It's not that, I don't think it's a mullet yet.
Baiju Bhatt:
Would you like me to trim your hair?
Turner Novak:
Right here, right now?
Baiju Bhatt:
I can do that right now.
Turner Novak:
I know you got to go in half an hour, so that might cut the end of the podcast. Maybe we could, the rest of this thing is just you cutting my hair and you're talking.
Baiju Bhatt:
This guy is cracking off.
Turner Novak:
The camera guy tie is like, "I don't want to deal with this right now. I'm just the mics."
Baiju Bhatt:
Okay. So seriously, a serious thing that has been a huge revelation for me. You watch that Seinfeld episode where it's like, one, I've watched a lot of Seinfeld. It's one of the later seasons. It's like George and Jerry. It's like the beginning of the episode, it starts with both of them at a coffee table and they both got mustaches and they talk about how instead of going on a vacation, they grew mustaches to take a vacation from themselves. This is totally real.
Turner Novak:
I've never heard of this before.
Baiju Bhatt:
But you should-
Turner Novak:
Well, I'll find the clip. I'll try to throw it in the show notes if people want to check it out.
Baiju Bhatt:
You should grow a mustache. And I say this because there is a mustached version of every single one of us that's hiding in there.
Turner Novak:
Really a big bushy 70s, 80s style?
Baiju Bhatt:
It's just like there's a slightly different version of you in there and you should meet that person at some point. Maybe when it's still cracking up.
Turner Novak:
As my mullet grows out a little bit more, maybe I'll throw in a mustache.
Baiju Bhatt:
Yeah, that's a good look. I like it.
Turner Novak:
Well, so one thing I do want to talk about Robinhood, but I think an interesting transition is when you were telling me the meaning of the word Aetherflux, what does it mean and how does that connect to Robinhood?
Baiju Bhatt:
Yeah, so the name Aetherflux comes from a love of old science, and so this particular one, I think Vlad and I stumbled upon our love of this around the same time. So back in college we were doing this one program. We were doing this project for a guy that was trying to come up with a slightly different theory of gravity at the time. He didn't believe in Einstein's theory. He was looking for physics undergrads to help him poke holes in Einstein's theory, and Vlad and I were like, "Cool, we'll do that."
Turner Novak:
And that's ended up being your co-founder at Robinhood-
Baiju Bhatt:
Yeah.
Turner Novak:
... for people who don't know? Okay.
Baiju Bhatt:
And so we were doing this summer research thing with this guy who had an alternative theory of gravity, and he was like, "You got to go to the primary texts and understand the history of how Einstein arrived at the special theory of relativity."
Turner Novak:
So is this Greek texts, back thousands of years ago, or?
Baiju Bhatt:
No, it's like 150 years ago.
Turner Novak:
Okay. Did Einstein wrote or?
Baiju Bhatt:
Yeah, Einstein's seminal special theory of relativity, I believe is 1904 or 1905. And so, okay, what is this theory of special relativity, right? So back in the 1800s, there was this thing called the Michelson-Morley experiment, which was actually done at Case Western University. It was 1850s, which was basically to try to figure out the speed of light.
And the idea was that light is a wave. Sound, like water, and so as it's a wave, it travels through medium. So sound waves travel through air, waves on water travel on the surface of the water. So what is the medium that light travels through? And so there's a bunch of experiments done trying to figure out what this medium was. They didn't quite know what it was, so they called it the Aether.
And without going into too many details about said Michelson-Morley experiment, although it is very cool, it was very confusing because people were measuring the speed of light. And this Michelson-Morley experiment is like, well, if you have a split mirror and you have light going in this direction and light going in this direction, this platform, whatever it is that we're talking about here, still on the surface of the earth, the earth is rotating around the sun. It's rotating around its own axis.
And so wouldn't you expect to see light moving in a slightly different speed in this direction versus that direction?Sounds reasonable. Yeah, that's not right. That's all completely wrong actually.
Turner Novak:
Okay, wait, so light just moves through air, is it just-
Baiju Bhatt:
So Einstein came along and was like, all y'all are completely wrong.
Turner Novak:
Okay.
Baiju Bhatt:
This is just completely wrong.
Turner Novak:
So you were trying to prove Einstein wrong?
Baiju Bhatt:
We were trying to prove that when Einstein proved everyone wrong, that he was wrong and we were wrong in our proving that he was wrong. And in turn, I think he was right.
Turner Novak:
Okay, fair. Is that how you met Vlad then? Or was it -
Baiju Bhatt:
I'd known Vlad from before that we had been friends for a while.
Turner Novak:
Was it high school summer camp, physics camp I think or something?
Baiju Bhatt:
No, we met in the Stanford physics program, I think two summers before.
Turner Novak:
Okay.
Baiju Bhatt:
But back to this Aether theory. So there was this idea that light travels through medium called aether. It turns out that light actually doesn't have a medium that it travels through because light is very special and that light doesn't actually have different speeds in different conditions. It's actually the reference frame that changed to accommodate light being the same speed in all reference frames.
This is what Einstein's theory of special relativity is. Anyways, there was this fictitious medium called the Aether, which I always thought was very cool. And the idea of Aetherflux is harvesting the flux through this fictitious medium.
Turner Novak:
Interesting. And it's what you're doing, you're sending light through mediums.
Baiju Bhatt:
Yeah.
Turner Novak:
Different mediums?
Baiju Bhatt:
Yeah.
Turner Novak:
Okay. And so you did this thing with Vlad. It was like, how did you guys go from trying to prove Einstein wrong, ended up being wrong to Robinhood? I know there's a little bit of a journey. What was that like?
Baiju Bhatt:
Well, we were both physics and math kids at Stanford. We were very, very earnestly focused on doing that as undergrads and as graduate students. I didn't have much interest in business. In retrospect, I think it makes sense that I started a company, but at the time that was, I wanted to study physics, I wanted to be an academic and maybe 10% of me wanted to be a musician.
Turner Novak:
What's your favorite artist of all time?
Baiju Bhatt:
I don't know if I have a favorite artist of all time, but I will say, I got a lot of love for Tupac.
Turner Novak:
Wow, okay.
Baiju Bhatt:
A lot of love for Tupac.
Turner Novak:
I wasn't expecting that.
Baiju Bhatt:
RIP.
Turner Novak:
Rest in peace. So then how did you end up starting a company? Why did you decide to do that instead of music or physics-
Baiju Bhatt:
Academia?
Turner Novak:
Yeah, or academia.
Baiju Bhatt:
So I left, after I graduated, worked for a little while, decided pretty quickly I wanted to start a company, called Vlad. It was like, "Hey, we should do this together." Because we'd already been really good friends, convinced him to not pursue his academic background or academic career in math. And so the first summer moved out to New York and decided to start a trading company, to get into quantitative trading, algorithmic trading. That did not go very well. Then we decided-
Turner Novak:
What did not go well? Could you not figure it out? Did you lose money? Was it boring?
Baiju Bhatt:
We just couldn't really figure it out. We weren't set up to succeed, I feel like. But also we were trying to compete in a very, very difficult environment.
Turner Novak:
Did you learn anything from it? And maybe that was it because...
Baiju Bhatt:
Well, from that, we were interested in the thing, what was happening in financial services at the time. I remember thinking that there were some tectonic plates that were moving and that markets were becoming more and more electronic. This is 10 years ago more. And so we were interested in what's the trend that's going to emerge from markets becoming much more electronic.
And at some point we had this light bulb that went off where it's actually, the way that this could become very real for ordinary people is if markets go electronic, the cost associated with it change. Could you then use that hypothesis to build a consumer product around that that gets to zero commission, stock trading as we did.
The interesting thing was, Vlad and I, we were math and physics kids, and in our spare time, even back then, we would stay up into the wee hours of the night and oh, "Check out this high school kid that built a fusion reactor in his backyard." And we were like, "Well, what if you could mine helium three on the moon?" These were the machinations we had and the wee hours of the night.
And again, coming back to what I was saying a little while ago, which is it felt like space happened before I was born and I told myself if I ever saw a path towards it happening again in my lifetime, it was something I was really, really interested in. And so it was this seeing the first Falcon or the first SpaceX landing of the rocket, I was like, "Oh my god, might this actually happen in my lifetime?"
Turner Novak:
So it's probably like you knew you always wanted to come back to this, but just the timing just didn't quite make sense yet, and then it did a couple years ago?
Baiju Bhatt:
Yeah, I had this dream in my mind that it's like if ever this finance thing ever goes really well, maybe I'll do that. But how do you plan for that, right?
Turner Novak:
Yeah. Well, so then how did you end up doing Robinhood? How did you come into that specific idea? I know you guys tried a bunch of different things. There was a social trading thing. I remember, I never saw it or used it, but I remember that was a piece of it.
Baiju Bhatt:
Yeah. We were working on what is Robinhood today when we were doing that too.
Turner Novak:
Okay.
Baiju Bhatt:
Yeah. We had this hypothesis pretty early on that if you could make investing in the stock market zero commission and you could make it mobile at the time, think about building financial products on mobile. This was not a thing.
Turner Novak:
Yeah, I think I was using Scottrade when Robinhood launched. Or I think it's like TD Ameri, I think it's been acquired multiple times, but I signed up for it because it was the cheapest brokerage, and I remember having to go into a branch and make an account, and I remember, I think it was either nine or six bucks a trade. And I think I signed up because I got three free trades. So I was like, "I'll buy a couple stocks and I just won't sell them and I'll never have to pay the commission." Or it was something like that.
And I remember also in my head, I always made sure I bought in blocks of at least a thousand because then the feed drag was lower because if you buy and then you sell, you're paying about 10 bucks per trade or whatever. On a thousand dollars, it's like 2% fee drag on one position going in and out. And I remember when Robinhood launched, I think I saw it on a forum that I was, I don't know if you ever remembered The End of the Internet?
Baiju Bhatt:
Mm-mm.
Turner Novak:
It was this secret underground, private invite only forum thing, and some guy was obsessed with it. You know how all these movements, you need someone who's just ridiculously obsessed. This guy was constantly posting all the updates. I think he was taking stuff from Reddit, hyping his link moving up, putting a screenshot of how you moved up the wait list. And I remember me and my friends were on, they were like, "Damn, this looks pretty cool. This is actually an interesting idea."
Baiju Bhatt:
Yeah, that's what I was working on back then.
Turner Novak:
Yeah. So what was going on at that point on your end? You guys were, it took a while to launch, raising money took a while. I think the launch was accidental too, sort of. I guess order of operations, what happened next? You had this idea, you started building it?
Baiju Bhatt:
Yeah, we had this idea. We thought that, I think the, looking back on it now, we thought that if we could make this exactly what you're talking about here, right? We're like, a lot of people aren't using the stock market because of this. And we think that there's a huge underserved market here of our generation of people.
Moreover, this comes back to who I think both of us as people and our life experiences. For both of us we're both only children, families both moved to the U.S. because our dads were pursuing academic careers here, both grew up in Virginia. We both were studying physics and math at Stanford. I think a part of this also was, it was pretty deeply ingrained in my brain that this was the land of opportunity.
And being in America, it was a huge sacrifice that my parents made and I have cousins and stuff. I had family in India and this was the place where if you could make a life here, it was the envy of the whole world. And here we were as young men coming of age, very much a coming of age story where there's this real intellectual disconnect that was happening because on the one hand we're like, this is the land of opportunity and this is the place where people can have access to capitalism in the financial system.
This isn't a bad thing, where at the same time, a lot of people of our generation, and this is like Occupy Wall Street movement stuff where the system's broken, tear it down. And we're like, "This just does not reconcile with our worldview." Why would you want to tear this down? There's another path here, which is that you actually make it so that everybody can be a part of it.
And if you did that, you would solve the real thing here, which is that people feel disconnected from this system and there's a people that are having great, better outcomes or whatever from it, and other people are just not a part of it. You could tear the whole thing down or you could get more people to be a part of it. And we believe that that was the world we want to live in. I think at that point, when you're starting a company and actually think you're going to solve a problem like that, that's -
Turner Novak:
The scope and the scale that it all gets to, you never know.
Baiju Bhatt:
You'd have to be crazy to think that.
Turner Novak:
Yeah.
Baiju Bhatt:
You also have to remember the backdrop at this point where we had been entrepreneurs for the better part of five years and didn't have a whole lot to show for it. And so you ask the question, it's like, "Well, what makes you think that this is going to have this wild outcome?" You don't. You think one step ahead and you're like, what is our hypothesis here? Why do we...
Turner Novak:
Yeah. Now, I was talking to Chad Byers at Susa and he said, I think, "One of the numbers is 70, one of the numbers is 110 investors that you talked to for the seed round." No one was giving you money. What was that like? How did that go?
Baiju Bhatt:
Both numbers sound very painful.
Turner Novak:
Yeah.
Baiju Bhatt:
Yeah.
Turner Novak:
What was the challenge? Talking about it today, it sounds like obvious, right? It sounds like a great intersection and great pitch market. Financial services is like 20% of GDP or something.
Baiju Bhatt:
I think it's interesting from a platform perspective. That's how I think about it.
Turner Novak:
You mean Robinhood as a product is interesting as a platform?
Baiju Bhatt:
Well, I think.
Turner Novak:
Or-
Baiju Bhatt:
More mobile as a platform or underlying platform technologies. When we were starting Robinhood, one of the theses was that mobile is going to be people's computer. That's going to be the device that is effectively their computer.
Turner Novak:
Was this like 2012, '13-ish?
Baiju Bhatt:
'13, '14.
Turner Novak:
Okay. So it was prominent, but maybe not as obvious.
Baiju Bhatt:
There were financial apps on phones. Our thesis was that this is actually the default place to do this and it should be the de facto place that you are able to do this because you're carrying it around with you all the time. At the time, that was one of the things that was viewed as crazy.
It's like, well, what makes you think that people are going to want to have their finances on their phone? That's like, what if they lose their phone or these questions about how people are going to use technology. Where in retrospect, it's obvious that you would use your phone for money because it's a computer and it's actually convenient having it in your pocket.
Turner Novak:
It's like a wallet, having money in your wallet or in your pocket.
Baiju Bhatt:
Yeah, my phone has my wallet on the back of it. They are the same object in 2025 for me. It was like, "Y'all don't know how to build consumer products. You guys haven't done this before. You're math people." And what makes you think that there's a generation of young people that is underserved, they could use these other things. What makes you think that this is the thing that's missing? And there was a lot of naysayers.
Turner Novak:
How did that make you feel as someone, I know you're really big on design and creativity. How did it make you feel when people said that?
Baiju Bhatt:
Motivated, very motivated.
Turner Novak:
How do you channel that as someone who you're going through a lot of no's, how do you channel the motivation in the right way?
Baiju Bhatt:
I love it. I'm serious. I really, really feed off of that. And I think that it's like a challenge. I love basketball. I've grew up with the idols in that world of Michael Jordan's and the Kobe Bryant's, right? And there's a level of focus, determination and using setbacks to bring out the best in yourself. That's how my brain works. I love it.
Turner Novak:
So you guys were determined you were going to make it work and their setbacks made it harder, but you just knew you'd figure it out eventually?
Baiju Bhatt:
These are the kind of incongruent truths you have to keep it in your head simultaneously. You have to both be incredibly inquisitive and you have to ask the questions of what don't I know? What rock do I have to look under that I haven't looked under yet? Or where is the insight? And you have to be very open to being wrong. You have to be open to putting your ideas out there and just being wrong. That's the one part of it.
The other part is you also have to be determined. You have to believe in your ideas and you have to have your own belief in yourself. And that's one of the things that's always been very resonant for me, is knowing where the outside opinions stop and where my own viewpoint starts. Because yeah, a lot of nos, it was pretty very difficult back then. And over time, I've learned to channel that and use that to use that as positive motivation.
Turner Novak:
Yeah. And I think you guys had to do it. I don't know if this is terms as part of the deal, but you had an interesting agreement to finally get someone to invest. Do you know what I'm talking about?
Baiju Bhatt:
Tim Draper?
Turner Novak:
Yeah. What happened there?
Baiju Bhatt:
Oh man. Yeah, so this was when we were at the pits of not being able to raise any money, and we went and met with Tim Draper and we told him what her idea was. And this man is larger than life. He's probably one of the most interesting people. This man is larger than life.
And I remember going to his spot in San Mateo, and I think there's a Tesla that had been the half in the middle of the place. And we're sitting there, he's wearing a Spider-Man tie. And we're like, "Holy cow, we're meeting with Tim Draper." And he's like, "Well, it's great idea. It's never going to work. You're never going to get past these approvals that you have or whatever."
Turner Novak:
You need a broker dealer license or something?
Baiju Bhatt:
Mm-hmm. And we were working on that at the time. And he's like, "How much are you paying yourselves?" And we're like, "What?" He's like, "How much are you paying yourselves?" And we're like, "I don't know. Not very much, enough to 60, 70, 80,000, I don't know. Not enough to be able to live in the Bay Area and have an apartment." He's like, "That's way too much. Great idea. Never going to happen. You guys are paying yourselves too much." And we leave this meeting and we're just confused.
Turner Novak:
Why is that a sticking point? We're just 60K a year, that's reasonable.
Baiju Bhatt:
We're just confused, right? We're like, we're paying 70,000, 80,000 maybe the most, I don't know.
Turner Novak:
Did you have student loans still at the time?
Baiju Bhatt:
Yes, yes.
Turner Novak:
That was probably 8, 10, 12% of your salary.
Baiju Bhatt:
Yeah, I had a dinky little apartment I was living in.
Turner Novak:
San Francisco's expensive city.
Baiju Bhatt:
Palo Alto. And so after this meeting we're both feeling, I was feeling pretty dejected. And so we got, and I think we went to get burgers across the street and we have the idea that we'll tell him that we're going to not pay ourselves until we get this approval and we'll do that if he invests. And he said, yes. And then the gut check came in where it's like, okay, can I still afford gas or am I going to have to start biking to work? Like, we did it.
Turner Novak:
You started biking to work?
Baiju Bhatt:
Well, I was biking to work as such, but I was like, I'm definitely going to bike to work now. But yeah, there was a couple of months where I was like, okay, it's just like, we got to do this. And again, very clarifying, very focusing. This is the thing is you have to take the setbacks and use it to bring out the best in yourself.
Turner Novak:
My friend Jaren Glover, also at Robinhood, I think I might have mentioned earlier, he said to ask how you guys got the domain name. I think it was an interesting story.
Baiju Bhatt:
Yeah. We had the domain robinhood.io originally, and we had this very half baked launch where we were going to try to do a normal announcement where we were going to go and talk to a bunch of tech reporters in the vein of getting turned down by a bunch of VCs. We couldn't really get any, reporters don't want to talk to us.
Turner Novak:
Really?
Baiju Bhatt:
And so we're like, all right, let's just test how this website works. And that's how it got out there. I remember that the first day, two days, right after it had just been posted on a bunch of forums, I get an inbound from Aaron Levie, the founder of Box. And have you met this guy before?
Turner Novak:
Yeah, I've actually had him on the podcast before.
Baiju Bhatt:
This man's brain works a mile a minute. He is like-
Turner Novak:
Yeah, he's the most interesting guy to have on a podcast.
Baiju Bhatt:
Yeah, he's super interesting, but his brain works so fast. And I remember I was like, one, I was starstruck, and two, I was like, oh my God, I hadn't done anything of any note in the world I felt like, at that point. And then all of a sudden people were contacting me, and I remember in that first day, he's like, "You should get the name, you should get the domain robinhood.com.
Turner Novak:
That was his thinking during the launch?
Baiju Bhatt:
And I remember within that first day, I remember he emailed me again. He's like, "Wait, you need to do this." He was very insistent that you need to do this right now.
Turner Novak:
Really?
Baiju Bhatt:
And I was like, "All right, this guy is clearly important to do." And I was like, "Well, let's see if we can get it."
Turner Novak:
Yeah. And that was the story there. But yeah, well, I think another question that you just alluded to this launch that sounds like you were trying to plan something and you're like, it just happened. What happened with the launch?
Baiju Bhatt:
I remember we were trying to get Google Analytics working. That was big top of mind. So we were like, "Okay, we need to get some traffic to the page, see if it works." And all of a sudden we're starting to see traffic and we're like, "Where's this traffic coming from?"
Turner Novak:
Because you hadn't launched yet, right?
Baiju Bhatt:
And we were testing Google Analytics, if I remember. And somebody, it gets posted on these forums and we start to see traffic from Reddit and Hacker News, and it's like, all right, cool, somebody posted it. But then the traffic is like-
Turner Novak:
Keeps going.
Baiju Bhatt:
It's going. And we're like, "Oh my God. I think we just announced our product somewhat inadvertently." This is on a Friday afternoon.
Turner Novak:
So you weren't ready?
Baiju Bhatt:
No, I wake up the next morning and I'm checking my phone and I was in the habit of reading Hacker News back then and I'm reading through Hacker News and I scroll past, it's like Robinhood, Moon Landing or some other thing. And I'm like, "Burt, wait a sec. What?
Turner Novak:
Robinhood, what?
Baiju Bhatt:
Wait a second, wait a sec, what?" And then I remember, got on the phone with everyone was like, "Guys, we have to get in. We're launching today. And I think that was the day that I got the like, hey, you need to look at this domain name email from Aaron.
Turner Novak:
Interesting, huh? And you said, I think you've mentioned that was your favorite moment in Robinhood. Is that still true?
Baiju Bhatt:
Really, really eye-opening moment. So I'll tell you, I think as an entrepreneur, this is really interesting because what does product market fit? This was a question that I was very, very interested in understanding.
Turner Novak:
It's a very abstract question.
Baiju Bhatt:
It's super abstract and basically if you have product market fit, it's off to the races and you'll make mistakes, you'll get stuff, but you'll be on a baseline of doing something that people want. And the general contours of the thing that you're doing match what people want.
The thing is, if you don't have product market fit and you've never seen it before, it's sometimes difficult to know that you don't have it because you might have some adoption and it might be just very lossy or it might be very difficult to convince or to get people to try the thing for the first time or to read through what the thing is.
And I had actually never really seen product market fit before. And that day, the day that it just started taking off on these forums, I was like, I think I learned something that day, which is what is product market fit? What is the heuristic? Is it a metric? When this quantity crosses this other quantity and there's a full moon, and it's actually just when the thing you're doing works better than you expected. You have middling expectations, good expectations and great expectations.
Product market fit is like whatever you estimate the thing to be, it's going to do better than that. I think the simplest heuristic I found for it, so we said differently, I think at the time it was like what is a group of a thousand people look like? And I think as humans we can conceptualize that and imagine a big concert or something like that. Where does 10,000 people look like? Yeah, you could imagine a giant giant-
Turner Novak:
An arena?
Baiju Bhatt:
An arena full of people, right?
Turner Novak:
Yeah.
Baiju Bhatt:
What does 100,000 people look like? I don't know. I can't really conceptualize that.
Turner Novak:
That was the wait list you guys had within a week. I don't know the timing, but-
Baiju Bhatt:
Yeah, it was pretty quickly.
Turner Novak:
It was pretty quickly.
Baiju Bhatt:
I think it might've been a couple of weeks, maybe a month, but it was really quick. But what does a hundred thousand people look like? Or what do the opinions of a hundred thousand people look like? I think it's very difficult for the human brain to conceptualize that. It's just the size of that group of people is, in nature, humans never encountered 100,000 other people in any one environment.
And so being able to conceptualize, if we build this thing and we're in one-on-one conversations with people that might want to use the product and they understand how it works or they're interested in using it, how does that translate to a huge audience of people? And I think that aspect of product market fit I saw for the first time.
Turner Novak:
So you mentioned one-on-one conversations with people. What is the value of doing user research?
Baiju Bhatt:
There's a bunch of different ways of thinking about it. I think one that's really been formative for me is the difference between quantitative and qualitative understanding of how people use things. So here's the basic heuristic. It's like if you have a question, we'll take the example of a couple of different questions and try to understand what kind of, how you might try to ascertain the answer to that. The first question is, what's your favorite color?
Turner Novak:
I would say blue probably.
Baiju Bhatt:
Yeah. So what is the favorite color? If you had to ask people what's their favorite color? Well, you wouldn't ask five people. You'd ask everybody in North America and then everybody in Europe. You'd have a massive sample size.
Turner Novak:
To get the data?
Baiju Bhatt:
Right, to understand that question. It's like 63% of people think blue is the best color. If you ask five people, you're not going to the answer to that.
Turner Novak:
Yeah. You might get zero if you only ask five people.
Baiju Bhatt:
Exactly. And if you got zero, you wouldn't conclude that blue is not the favorite color. You'd be like, "We just talked to five people that like green." Now let's compare that with a different question, which is I put a door in front of you with a small circular rotating thing on it and you're like, "Get to the other side of this thing." How many people do you need to test that doorknob before you know whether it's a good design or not, or whether you've got the answer or not.
One, if the first person's like they can't get to the other side and your door sucks, you've answered the question, this is a bad door. This is the difference between preferences versus utility. There's also a relationship between this and qualitative and quantitative research where a lot of the stuff that we would do in terms of do people know how to use this product? Do people know how to use this thing to do the thing that we think that they might do with it? It's a lot of that in person. It's complete this task.
And if you have a sample size of five people and they don't all get it, you got to understand why. And those situations, I think things like in-person research is super important because you can ask questions in between the main question that you asked where if you just tried to sample a ton of people, if you didn't ask the right question, you just would miss all of that stuff.
Turner Novak:
So how did you design your user research team and sessions, or how do you recommend somebody do that?
Baiju Bhatt:
My main heuristic was when you start hearing the same things over and over again, you have a next person in your session, you're asking them questions, if you know what they're going to say, probably a good time to stop, pick up your pencils, make a new iteration of it, and then run that back through until you start hearing the same thing over and over again.
Turner Novak:
So you keep asking different questions in different ways and they keep saying the same thing and telling you the same thing?
Baiju Bhatt:
Well, if you have a prototype for something and you're like, "How does this work? Or use this thing or do this thing?" And you talk to five people and they're like, "Well, I'm having a lot of problem with this one part of it." Probably after five or six people you're like, "Yeah, we got to do something about this part of it. People don't know how this thing works."
Where if you didn't ask about that thing, if the one person that you were talking to was like, "I don't understand this thing." You're like, "Well, let's double click on that. What's going on there?" If you just do quantitative stuff, you just gloss over stuff like that. You gloss over the questions you didn't ask and the questions you didn't ask, some of those might be more important than the questions you did ask and you have to ascertain that.
And so another way of putting it is that in the breakdown between qualitative research and quantitative research, the qualitative side is valuable for hypothesis generation. So we talked to 10 people and seven of them said this thing. We think that a lot of people might be experiencing this, right? And so let's try to solve this because it might solve the problem for a bunch of people.
Turner Novak:
So any examples, maybe products at Robinhood that came out of interesting user research sessions?
Baiju Bhatt:
I think a lot of it did.
Turner Novak:
Really?
Baiju Bhatt:
Yeah.
Turner Novak:
How did you know what to prioritize? I think today, I think I saw a stat, Robinhood has five products at over 100 million in revenue or something, those numbers might be wrong, but was you have a lot of features that do things for people. How did you prioritize what to do?
Baiju Bhatt:
I don't know that there was one consistent prioritization that that was applied across the board, mostly because the company went through a lot of different stages and it's over the course of over a decade. I think one thing that we did do that I always thought that we did do is we were very open-eyed about we're is a pretty small company, at least in the early days. And so the resource constraints made so you couldn't like parallel path to everything.
Turner Novak:
I think another question that kind of want to ask this come out of all of this is how much do you value creativity and design and how do you pull that out when you're in a startup, you're resource constrained, you're trying to run a business, be profitable, make money, but you still want to value good design and be creative?
Baiju Bhatt:
I think creativity is relevant for design. I think creativity is a very broadly applied thing. I think design is one of the places where it's really, really conspicuous. But creativity is in this, we're not building a consumer project with Aetherflux, for example. But I think there's a lot of creativity in what we do.
And the creativity comes in what's like, what if you could do it this way or I was thinking about this for a while and I don't know if this is the right idea or not, but let's talk about it, right? I think creativity comes, at least for me, I talk out loud a lot. I think out loud. It comes from pressure testing ideas and being able to articulate an idea when it's pretty fragile and coming back to stuff a little while ago, having the confidence to be like, "You know what? I'm not going to give up on this if it doesn't look right in the beginning, but I'll take that feedback and think about it a little bit more, iterate on it a little bit more."
I think creativity is, said differently, I think that there's a bit of a fallacy that there's a path independent way of thinking. I think there's lots of different ways of doing things and if you don't believe that there's lots of different ways of doing things, you inherently don't look for the creative way of doing it. Because you think there's one way of doing it.
Turner Novak:
Yeah. So you never question the current state?
Baiju Bhatt:
Mm-hmm.
Turner Novak:
I actually have one last question. You've got a ring with a cat on it. Someone told me there's some significance between Robinhood and cats. What's the significance?
Baiju Bhatt:
I really like cats.
Turner Novak:
You just like cats?
Baiju Bhatt:
I love cats, yeah. I'm super duper allergic to them.
Turner Novak:
So do you have any cats?
Baiju Bhatt:
I do. I have two cats.
Turner Novak:
And you're super allergic. So you just-
Baiju Bhatt:
Super duper allergic.
Turner Novak:
... medicate up or you just constantly on allergy medicine?
Baiju Bhatt:
We have outdoor cats.
Turner Novak:
Nice, okay.
Baiju Bhatt:
Yeah. I was very, very allergic to cats. We had, back in the early days of the companies before Robinhood, there were always cats living in our office.
Turner Novak:
Okay.
Baiju Bhatt:
The way immune responses go, right? You get more allergic as time goes by.
Turner Novak:
Oh, do you?
Baiju Bhatt:
Oh yeah.
Turner Novak:
I didn't know this.
Baiju Bhatt:
Oh yeah.
And so I was allergic to cats in the beginning, but by the time-
Turner Novak:
10 years in.
Baiju Bhatt:
Holy cow, I'm super allergic to cats. So I live vicariously through my jewelry of cats.
Turner Novak:
So what makes cats so awesome? Because my daughter's also obsessed with cats. What makes cats so cool to you?
Baiju Bhatt:
I think it's possibly the smuggest mammal.
Turner Novak:
Mm-hmm, I can see that.
Baiju Bhatt:
Yeah. I think if you want to get something that's more smug than a cat, birds are very smug. I think you got to start venturing out of the mammals.
Turner Novak:
Interesting. Yeah. Okay. So you like smug animals?
Baiju Bhatt:
Yeah, I like cats because they're smug. I don't know why, for example, I find venturing outside of animals. I find, for example, pineapples to be very smug. It's a very pointy fruit, right?
Turner Novak:
Yeah. And they're very spiky. The shell is spiky and then the taste is, it will really get you.
Baiju Bhatt:
Exactly, right. I don't really care for pineapples, so it's more of a cat specific thing.
Turner Novak:
Yeah. Okay. Well, cool. So how can people, I guess, just find you follow along, what's going on with Aetherflux? What should people do?
Baiju Bhatt:
I think probably best way is to give me a follow on X, on Twitter.
Turner Novak:
I'll throw it in the show notes and then website, aetherflux.com. People want to check it out.
Baiju Bhatt:
That's right.
Turner Novak:
I'll also throw that in. Well, cool. This is a lot of fun. Thanks for doing it.
Baiju Bhatt:
Thanks for having me. This was awesome.
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