Enter The Brokerage Wars: Gatsby? What Gatsby?

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In this episode of the Fintech Focus podcast, we enter the brokerage wars with Jeff Myers, co-founder and co-CEO of Gatsby.

Just like the name of the eponymous book it gives a nod to, this Gatsby also sees the green light when it comes to opportunity—and that opportunity is giving people access to commission-free options trading.

By providing a clean, easy-to-use app and simplifying the options buying process, Gatsby is trying to do for options what Robinhood has done for stocks.

Among the things we discuss with Myers: how the app works, who it’s meant for, payment for order flow, and why there’s no such thing as something being “too easy.”

Listen to the podcast below to hear how Myers is hoping to make the options world go gaga for Gatsby.

How did Gatsby come about?

So, my background is in technology and design. And actually, some people get a kick out of this—I hadn't traded options until a couple years ago. And essentially what my co-founder and I started to understand was that options are a really interesting financial tool because they're very conducive for this new generation of traders.

One, you can play around with an options contract. I'm talking buying options. You can play around with an options contract with less money because you have more control over how much risk you want to talk. You can go further out of the money, and therefore you can actually buy a call on Amazon.com, Inc. AMZN when you maybe couldn't afford a share. So, it's good for people with smaller accounts that sometimes want to play with stocks that are really expensive.

But we got really into options after that and realized that there's a need for a simplified no commission options trading app to bring new traders to the market.

What features are on the app right now?

Yeah, so you can buy puts and calls and we have a social feed. A lot of people who sign up for Gatsby email me and they say it looks like Venmo. It's a weird analogy because these are very different types of apps, totally different functions, but it does have this social feed just chronological list of all the trades that go through Gatsby to the extent that we're allowed to share. Obviously we're being ultra-compliant with FCC guidelines about integrating social feeds into a brokerage platform as it's nuances, but it's really cool because we see one of the more prolific traders on the platform, people start to see their faces more often, and they kind of find inspiration from them.

So, like, one trader one day will buy a put on x, y, z company and then over the course of the next couple hours, we see a couple other traders do that. So, it's kind of cool to see the community influence each other and find inspiration from each other. So that's, I think, a big feature for us. Especially for new traders, it's really cool to see what other people are doing. You get a sanity check before you do anything.

How has the last year plus differed from what you thought it might be like when you started?

Yeah, it's a great question. So getting a broker dealer license is obviously very complicated. My background has been just building apps and web applications and testing it with users and iterating on it really quickly. But you know, our COO basically says "Whoa, whoa, slow down. We have to go clear this with FINRA," or "We have to go clear this with our lawyer."

And so that ... it's like a new experience for me. It's great and I understand that it's super important. So we're trying to surround ourselves with people that will slow us down, as the product people and the technology people that come from sort of the era of move fast and break stuff, and actually just do it by the book in the right way, work with the regulators, make sure that the T's are crossed, the I's are dotted, and also make sure, simultaneously, that the users are having a great experience.