Wall Street invests in Gen Z
Future. New fintech platforms are wooing Gen Z to Wall Street, from gamifying stocks to turning the act of investing into a communal experience (like sharing a TikTok). And like the attitudes fueling the Great Resignation, young investors are looking to park their money in companies that share their values. Call it a vibe shift in the financial industry — the next class of investors may be turning retail trading into a form of social activism.
Vibe portfolioWhile platforms like Robinhood, Public, and Acorns are popular among Millennial and Gen Z investors, new fintech platforms are taking cues from social media to further tap into the young market.
Staxx, which will be available this spring, recently raised $1.6 million and allows users to send each other payments in the form of stocks. Users can also see what their friends are investing in (although the amount invested is hidden).
Alinea raised $2.3 million to build out its Instagram-like platform, which lets users share “playlists” of themed investments, such as “Black empowerment, LGBTQ+ empowerment, women-led companies, and combating climate change.”
These apps are especially geared toward female retail investors, who have been “turned off by Robinhood’s video-game-like feel” — a criticism widely lobbied at the platform. Not that Robinhood is suffering because of that — it’s still the top investing among app Gen Z, according to a survey by Jefferies Group.
Stock partyThe rise of these youth-skewing platforms reflects the changing definition of what is “cool” on Wall Street.
Younger investors are looking at a company’s goals in carbon neutrality, equality, and integrity before investing.
They’re also looking to use platforms that are aesthetically pleasing, put a premium on “values-based investing,” and help create community.
And with Gen Z having some $360 billion in disposable income last year, it’s no wonder that traditional banking and investment firms such as UBS and JPMorgan Chase are acquiring or pouring money into youth-focused fintech startups. Last year, funding in the space hit a record $14.6 billion — most of which was in the U.S.
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