What

Public is a New York-based fractional investing platform through which users can invest in stocks and bonds, crypto, ETFs, NFTs, treasury bills, and other vehicles. Founded in 2019, Public has raised over $300M, including a $220M Series D from Tiger Global, Lakestar, Accel, Greycroft, and others in February 2021.

Public has recently launched a treasuries platform, and has also recently announced the option for investors to acquire supplemental insurance on brokerage accounts if they’re concerned about crossing the $500,000 SIPC insurance limit.

Why

According to Sam Nofzinger, Public’s GM of Brokerage + Crypto, how user demographics change, and the extent to which these users mature, have hinged upon the kinds of trading platforms available to them. Trading used to come with high fees on websites like E-Trade, before companies like Robinhood—years after the ‘08 crash—provided fee-free trading, thus opening up stock trading to new demographics. Increased disposable income in the early years of the Covid-19 pandemic also shifted dynamics, Nofzinger argues, since it moved investment away from companies that investors believe in, versus investing in a stock due to potential short-term increases in their price.

“We got detached from fundamentals,” he said.

But the average retail investor has significantly matured over the past 18 months.

“A year and a half ago, our top ten holdings across our base were things like Gamestop and AMC stocks,” Nofzinger said. “Now, if you look at our top ten holdings, four of those are low-cost domestic stock ETFs—so there's been a radical shift, as folks have increased their knowledge base about how to properly invest. We've definitely seen a shift toward more responsibility.”

How

Public’s products have been designed to encourage investor maturation while also responding to their demands. Through educational content, Public encourages investors to move away from hyper-short-term investing and develop their own theses and goals. Through explainer content like Q&As with analysts, strategists, and ETF companies, Public looks to provide access to professional, expert investors.

The company also stays dynamic with the kinds of investment vehicles it offers its customers. “The more things that you can offer your investors, the more your investors are allowed to do within your ecosystem,” Nofzinger said. With greater investor maturity has come greater demand for a diversified portfolio. Selling virtually risk-free treasury bills that offer a five-percent yield has been part of that product strategy.

In addition, given investor uncertainty in the wake of SVB and Signature Bank’s collapses, Public has offered additional SIPC insurance for investors’ brokerage accounts. The bespoke product offering is “great for a small set of the population,” Nofzinger said, since most Public investors don’t cross the SIPC insurance limit of $500,000. The product gets set up manually through Public’s customer support team, as most of the onboarding process involves paperwork on the backend.

Finally, Public seeks to roll out options trading later in the year. “Options can be used for risky endeavors, but they can also be used to basically help you manage your portfolio risk, so you can protect the gains you've made,” Nofzinger noted. He anticipates that options will increasingly get used as hedging products, and get investors invested in high-interest-rate instruments that are not just in treasuries.