Extra Crunch Friday: A fraction of Robinhood's users are driving its runaway growth

10 investors predict MaaS, on-demand delivery and EVs will dominate mobility's post-pandemic future

Since the pandemic began, have you been walking more, or do you know someone who bought a new car? Did you run your first errand on an e-bike or scooter?

Over the last year, I’ve experimented with different mobility options to see which ones best suit my needs, as have most people I know: it’s challenging to maintain a recommended physical distance on a bus or subway!

The pandemic spotlighted many of the weakest points in our transportation system, but some of the shifts in behavior are creating opportunities for tech once considered fanciful like sidewalk delivery robots and flying taxis.

Transportation editor Kirsten Korosec reached out to 10 investors to learn more “about the state of mobility, which trends they’re most excited about and what they’re looking for in their next investments.”

Here’s who she interviewed:

• Clara Brenner, co-founder and managing partner, Urban Innovation Fund
• Shawn Carolan, partner, Menlo Ventures
• Dave Clark, partner, Expa
• Abhijit Ganguly, senior manager, Goodyear Ventures
• Rachel Holt, co-founder and general partner, Construct Capital
• David Lawee, founder and general partner, CapitalG
• Sasha Ostojic, operating partner, Playground Global
• Sebastian Peck, managing director, InMotion Ventures
• Natalia Quintero and Rachel Haot, Transit Innovation Partnership/Transit Tech Lab

Thanks very much for reading Extra Crunch this week!

Walter Thompson
Senior Editor, TechCrunch
@yourprotagonist

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A fraction of Robinhood's users are driving its runaway growth

Yesterday’s House Financial Services Committee hearing on the GameStop short squeeze saga was fairly typical: most lawmakers used their time to grandstand and little new information was revealed.

But Alex Wilhelm found one tidbit: much of Robinhood’s revenue is generated from payment for order flow (PFOF). Under the practice, market makers pay the trading platform for executing trades.

To get a sense of how much Robinhood’s high rollers contribute to the company’s general health, he calculated its PFOF revenues for the last three months of 2020.

“Borrowing a term from the casino trade, these whales generate the bulk of the company’s revenue stream.”

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Extra Crunch Live is a brand new beast in 2021

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Every Wednesday, join a conversation with a founder and an investor who'll offer feedback on pitch decks from the audience!

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Why do SaaS companies with usage-based pricing grow faster?

HubStop introduced usage-based pricing in 2011 to boost its retention rate, then near 70%.

Three years later, when it went public, its net revenue retention rate was edging close to 100%, “all without hurting the company’s ability to acquire new customers.”

Offering new users frictionless onboarding, customer support and free credits is a proven method for making them more active — and loyal.

So, why do public SaaS firms with usage-based pricing see faster growth?

“Because they’re better at landing new customers, growing with them and keeping them as customers,” says Kyle Powar, VP of growth at OpenView.

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Paying $115B for Stripe or $77B for Coinbase might be quite rational

In October 2018, private-market money valued Coinbase around $8 billion. As of this week, it’s valued at $77 billion,

Similarly, Stripe is valued at $115 billion on secondary markets. In the middle of last year, that figure was closer to $36 billion.

“Would I line up to pay $77 billion for Coinbase?” asked Alex. “Probably not, but that doesn’t mean that the public markets won’t.”

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Pandemic-era growth and SPACs are helping edtech startups graduate early

Natasha Mascarenhas reports that some edtech startups are hitching rides with special purpose acquisition vehicles so they can speed up their journey to the public markets.

To learn more, she interviewed Susan Wolford, chairperson of $200 million SPAC Edify Acquisition, and Nerdy CEO Chuck Cohn.

Nerdy, the parent company of Varsity Tutors, is going through a reverse merger with TPG Pace Tech Opportunities.

“It’s less about going into the public markets, and more about that this transaction allows us to take an offensive position and lean into the big opportunities,” Cohn said.

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Dear Sophie: Tips for filing for a green card for my soon-to-be spouse

Dear Sophie:

My fiancé is in the U.S. on an H-1B visa, which is set to expire in about a year and a half.

We were originally planning to marry last year, but both he and I want to have a ceremony and party with our families and friends, so we decided to hold off until the pandemic ends. I’m a U.S. citizen and plan to sponsor my fiancé for a green card.

How long does it typically take to get a green card for a spouse? Any tips you can share?

— Sweetheart in San Francisco

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