Time spent on phones is up! As eMarketer notes, people spend over three hours a day on their phones now, up 13.9% from last year. All major app categories are surging, but social networking has gained the most: 11 minutes per day for the average adult. With limited ability or reason to leave my apartment, I have trouble finding any time off my phone. Work calls, Zoom happy hours, and what feels like endless scrolling through the many social apps at my disposal, I confidently fall into that "average adult" category.
But if time spent on phones has been impacted by Covid-19, it pales in comparison to how different industries and businesses have been affected. Travel and retail are down, gaming and streaming are up, and the stock market, after gaining all the territory it lost since March, is unpredictable at best. But when the market took it's steepest drop at the height of virus-related uncertainty, there was one glimmer of positivity: the ability for many to invest in the market for the first time.
Button sits squarely in the mobile commerce space and is always looking out for innovative mobile tech. Given the current trends - more time spent on phones and social apps, plus a new-founded ability and interest in investing - we were instantly drawn to Public.com. I sat down (virtually) with Katie Perry, VP of Marketing at Public, to learn more.
Whenever I describe Public to someone who hasn't used it before, I usually start by telling them to erase whatever picture they have in their mind of investing in general or a typical investing product. What we're doing is completely different.
Katie, who has a background in brand marketing and corporate strategy, met one of the co-CEOs of Public while running her own marketing strategy consultancy. The product and mission immediately resonated with her.. "With great people and a beautiful, intuitive product," she said, "it didn't take much to sell me on the opportunity."'
Where else can you find experienced traders, college students, creatives, VCs, healthcare professionals, and more coming together to share ideas over common interests in specific companies or industries?
Public makes the stock market social. With the ability to invest in 'slices' of stock, people of all ages (adults 18+) and backgrounds have greater access to investing, can own a piece of the companies they believe in, and learn from those around them through social shares and messaging. As Katie describes, the combination creates a unique offering to its users: "while fractional shares help break down economic barriers to entry, the social layer aims to tackle the psychological barriers that so many people feel when they think of investing."
What we saw during the peak volatility in March was that during times of uncertainty, people really leaned into the social aspect to learn alongside their friends and others in the community.
To learn more about Public and current trends in social investing, check out my conversation with Katie.
1) AG: Who's your main audience?
KP: We're building a broad community of investors, which means that the experience should feel welcoming and familiar to investors of all kinds. One of our core design principles is to optimize for human beings, not user profiles. I can't tell you how many times a new member gives us feedback that the app feels familiar to them, despite them being new to investing.
We're building a lot of features that make Public a safe place for new investors in particular. For example, when Hertz announced they would be selling additional shares of common stock (despite filing for bankruptcy), we halted buying on our platform to protect members from a potentially risky investment. We've also introduced Safety Labels, which flag stocks that the SEC deems riskier than others based on things like financial standing and market cap.
Another interesting tidbit is that the majority of our members (more than 70%) define themselves as mostly or exclusively long-term investors, which challenges the myth that stock-picking necessarily implies short-term trading behavior.
2) AG: For those of us bad with fractions...tell me more about these "fractional" shares.
KP: Fractional shares means that Public slices stocks up into smaller pieces, so you can own a fraction of a share for just $1, $5, $100, or whatever amount you like. This means that anyone can own a piece of the companies they believe in, no matter where they are on their financial journey.
3) AG: How does the social aspect work exactly?
KP: Traditionally, the stock market has felt inaccessible to many people. It has also traditionally been something that you're expected to figure it out alone. Public is the only investing app that makes it possible to share why you invest and have conversations with other investors about their own decision-making. We even have a chat feature so people can build dedicated chat groups around the companies, industries, and values they care about.
When you make a trade—invest in a company or sell a position—you're prompted to share why with the community. Sharing the "why" helps others in the community understand your thought process, and gives them a place to ask questions and learn more. Here's a recent example from one of our members, who invested in Tapestry ($TPR), a luxury fashion brand. The "why" for this member was in support of the diversity of the company's leadership team.
4) AG: What interesting trends have you seen given the current climate and all of the impacts we've seen across industries (and stocks alike)?
KP: People are paying more attention. In the wake of the Black Lives Matter movement, we saw Corporate America almost at once wake up to its challenges when it comes to diversity. This is especially jarring in the context of publicly-traded companies. There are only four black CEOs on the Fortune 500 list and none of them are women. Women represent just 37 Fortune 500 CEOs in all. Public recently curated a list of companies setting the bar for diversity, and our conclusion in building the list was that the bar is not nearly high enough. Only 20 companies met our criteria, which included having minority representation in senior management and on the board. We're hoping this list gets a lot longer very soon.
In the context of the coronavirus, we saw huge impacts on the economy and the stock market (which are not the same thing!). In March, the market swung very low and at that moment, there was a surge of interest among new investors. These people spotted an opportunity to invest in certain companies while the prices were off their previous highs.
The thing about the market right now (and in general) is that nobody can predict what's ahead with 100 percent accuracy. But despite what's happening, and perhaps because of what's happening, you're seeing this growth in conversations about business news. Axios recently reported that business and finance media outlets saw the most growth in Q1 of this year—more than sports, celebrity/entertainment, etc.
People want to talk about business strategy and they want to talk about it with their friends. From March to April we grew our customers by 80%, because not only were people interested in investing, but they wanted to do it together. The collaboration of ideas we see in the community is a really powerful thing, with people commenting on current developments (e.g. what is Elon Musk saying now?) or making statements about wanting to support companies with diverse CEOs, like Lowe's, for example.
5) AG: Button's mobile-only, too, so we get it...but can you explain why Public is a mobile-only experience?
KP: Instead of looking at what was out there in terms of brokerage platforms and modernizing bits and pieces, our team started from the customer and built around what today's investors are actually looking for in an investing experience.
Public's mobile app is insanely intuitive, making it possible to invest with a just tap and a swipe. Every aspect, from the color scheme to the copy, defies the norms of our category. We employ a minimalist aesthetic and communicate in straightforward, human terms instead of financial jargon. Instead of organizing stocks and ETFs in sectors, we curate Themes around interests and values, like "Women in Charge" (companies with female CEOs), "Combat Carbon," and "Self-Driving Cars."
Importantly, as we strive to build an intuitive product, we also realize the responsibility that comes with providing more access to the stock market. For that reason, we've built in product guardrails, like Safety Labels, to ensure our members have context before buying potentially risky stocks. We also do not offer complex trading instruments, like margin accounts, and we have a strict no day-trading policy.
6) AG: How does Public measure success?
We want our members to be engaged with their portfolios on a daily basis. At Public, don't define "engagement" as trade activity, rather we define it as time spent participating in conversations around the companies and trends you care about.
KP: We want to create an experience that makes it fun to be engaged with your portfolio on a daily basis: reading articles about the companies you invest in or "watch," browsing the feed to glean new insights from the community, and participating in chat groups.
It has been really interesting to see how much our members have taken to the social features in particular. In March when the market was at its most volatile, we saw a 70% uptick in social engagements and twice the amount of time spent in our app. People seemed to want to make sense of the volatility together instead of going at it alone.
This is not investment advice. See public.com/disclosures.
For more interviews with forward-thinking leaders in the mobile industry, check out the Talking Shop section of the Button Blog.
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