Moving fast and breaking things doesn’t fly anymore

Even if it benefits consumers. Case in point: Robinhood.

Many of the top tech companies took “ask for forgiveness, not permission,” a little too seriously, flouting laws and local regulations in the hopes they’d achieve “too big to regulate” status through widespread consumer adoption. Those days are coming to a close.

In 2014, Facebook edited their “Move Fast and Break Things” developer mantra over to the notably tamer “Move Fast With Stable Infra” — obviously, even a boring instructive didn’t keep the company out of trouble. The Ubers and Airbnbs of the world, previously given slack, have faced increasing pressure from cities around the world to conform, or be pushed out. San Francisco, burned by both, enforced strict limits on the companies behind the electric scooters that were briefly scattered across every surface imaginable.

Just recently, Robinhood announced intentions to provide a new checking account product that would offer an unheard-of 3% interest rate, insured by the SIPC…without informing the SIPC. The SIPC swiftly sprang into action and let the world know they would do no such thing, and to do so would be illegal, accusing Robinhood of trying to take advantage of the lower level of regulatory oversight required by the SIPC (vs FDIC, which is what traditional bank accounts fall under).

My take? Benefits to consumers shouldn’t have to depend on companies breaking the law — and it’s naive to think that’s all that’s on these corporations’ minds when they do.