Former Citadel Trader is Now Betting on Retail

[0:00] If I've got $10,000 of Nvidia, I can't
[0:02] do anything with it, right? I can pledge
[0:03] it for a margin loan, great. But I can't
[0:05] pledge it for a home loan. I can't take
[0:06] cash out against it. If the stock loan
[0:08] gets tight, I get no yield. If I hold
[0:10] the the blockchain native token, I can
[0:12] enter into a smart contract either on
[0:14] Figure or another platform, earn yield,
[0:17] take cash against it. I can use as a
[0:19] home loan. You know, it's got utility to
[0:21] me. What's going on, guys? Today, we got
[0:23] a great conversation with Neil McDonald.
[0:24] He's the CEO of Mumu US. And Mumu is
[0:27] taking over the United States. These
[0:28] guys are on fire and he's here to
[0:30] explain to us exactly what's happening.
[0:32] Why so many retail traders now have
[0:33] sophisticated tools? What are they doing
[0:35] on the platform? How is he thinking
[0:37] about tokenized stocks, crypto, and
[0:38] various other new technologies? And then
[0:40] we even get into what he's doing himself
[0:42] on the platform. Neil's very interesting
[0:44] because he used to work at a bunch of
[0:46] very large financial institutions. He
[0:48] was a big dog there. He ran some of the
[0:49] teams. He's going to explain to us what
[0:51] was going on there, how the cultures
[0:52] worked. but now he's the CEO of a retail
[0:54] trading platform and he's trying to
[0:55] bring a lot of those types of tools or
[0:57] those types of approaches to the retail
[0:59] trader. That's you, that's me and a lot
[1:01] of people who are listening. Here's my
[1:02] conversation with Neil McDonald. All
[1:04] right, Neil, I thought a great place to
[1:05] start the conversation. Mumu is taking
[1:07] over the world. I think that people in
[1:08] the United States a couple years ago,
[1:10] they had never heard of this thing
[1:11] before. They had heard of, you know, all
[1:12] the other retail brokerage platforms.
[1:14] And you guys burst on the scene. You're
[1:16] taking over the Subway. You got a Mets
[1:17] partnership. All this stuff that is
[1:19] marketing. But I looked into the
[1:21] numbers. You guys are massive. Talk a
[1:23] little bit as to why is Mumu being so
[1:25] successful on a global stage behind this
[1:27] whole retail trader movement.
[1:29] >> I I think we kind of caught the the uh
[1:32] it's it's good timing, right? So the
[1:33] rise of the retail trade everyone talks
[1:35] about. Um so we got like Mumu is a
[1:38] global firm. So we started in Hong Kong.
[1:40] Uh we came to the US about 201920. But
[1:43] the big push in the US has been really
[1:45] the past couple of years with the subway
[1:47] with the Mets uh and just the name
[1:48] recognition. We're open. We're going old
[1:50] school. We're opening a store back to
[1:52] the old Erade days with a coffee shop in
[1:54] it uh in Midtown on 33rd and Broadway uh
[1:57] just to be more visible and you know
[1:59] have something people can touch and
[2:01] trust and and and everything else. So I
[2:04] I I got a call two years ago from I Mu
[2:07] was not on my radar. It was kind of I
[2:08] knew all the other I've got every other
[2:10] platform.
[2:10] >> No, you did you did the marathon. You
[2:12] you went through pretty much every major
[2:14] amazing finance company. You worked
[2:16] there and ran a very big division there,
[2:17] right? Morgan Stanley, uh JP Morgan. And
[2:20] I you just ran the gamut.
[2:21] >> Yeah. So I was always a I ran options
[2:23] trading desk and quant trading desk at
[2:25] Citadel. I did all that kind of so I was
[2:27] always on the other side of the retail
[2:29] trader, right? I was always the guy
[2:31] happy to take retail. I would pay more
[2:33] to people like Erade and TD and those
[2:36] guys. Uh there's four things that retail
[2:39] traders have lacked, right? First was
[2:41] information. the information asymmetry
[2:43] when I started in late 80s uh I was at
[2:46] Goldman's and when Proctor and Gamble
[2:48] had their uh earnings for example that
[2:51] some guy would dial it in from
[2:52] Cincinnati to the sales guys they'd go
[2:54] and speak to the institutions uh the
[2:57] stock would move the the the all the
[2:59] information would be digested into the
[3:01] stock price and then by the time I got
[3:03] it up the next day as a retail guy in a
[3:05] Wall Street Journal or the Financial
[3:06] Times in the UK all the alpha's gone
[3:09] >> right so there is that huge information
[3:10] asymmetry that got solved by the
[3:13] internet.
[3:14] >> And then the second thing was access. So
[3:15] people like Erade, Robin Hood really
[3:18] gave cheap fast access to to data uh to
[3:22] the markets themselves. And then the
[3:24] rise of like free trading. So Robin Hood
[3:26] was revolutionary back in 20134 and
[3:29] that's when um Futu Muma started in Hong
[3:32] Kong around the same time. Um so I was
[3:34] saying it was information they lacked so
[3:37] they're always going to be wrong. If you
[3:39] do your series 7 today, and this is in
[3:41] 2026, they still have a qu a question
[3:44] and a section on a thing called the
[3:46] oddlot theory. And this is a real thing.
[3:49] And that is, and this obviously before
[3:51] you could slice and dice orders, block
[3:53] trades were institutions. Small trades
[3:55] were retail. That's just how it was
[3:57] before you slice trades and did small
[3:58] ALGO stuff as an institution.
[4:02] And so when the volume divided by the
[4:04] number of trades hits a certain level,
[4:06] so it's more retail participation. When
[4:08] that gets high, it's a sell signal and
[4:10] when it gets low, it's a buy signal,
[4:12] >> right? So they're always wrong. So we
[4:15] solved the internet solved the
[4:16] Street.com or Yahoo Finance. That's
[4:18] democratized information. All of a
[4:20] sudden, I know when the uh when the Fed
[4:23] changes rates, I know when an earnings
[4:24] report comes out, I can watch the news.
[4:26] I can watch CNBC. I can listen to
[4:29] podcasts. So we all have the same
[4:30] information. But then do you have the
[4:32] access and now everyone has the access
[4:34] and um commission free trading so it's
[4:37] cheap and it's accessible. So the next
[4:39] step, what they didn't have is the
[4:40] tools, right? So you've got the access,
[4:42] you've got the information. How do I
[4:44] actually use the accessing information
[4:46] to make money? So the tools wise, uh, if
[4:49] you're looking on our platform, it's
[4:50] it's bonkers. It really is. It's you
[4:52] have on our desktop and our phone what I
[4:56] had at Citadel running a quant trading
[4:57] desk. You've got back testing. Um, it's
[5:00] funny. It's new year. every new year for
[5:02] the past maybe 10 15 years I bought the
[5:05] Udemy teach yourself Python course right
[5:08] >> I've done two lessons and given up um on
[5:11] our platform you don't need that anymore
[5:13] it's uh no code algo building so just
[5:16] block to block to block just if then if
[5:18] then if then here's is here's the crazy
[5:20] thing I can build an algo
[5:22] >> and then I can back test it on 20 years
[5:25] worth of data for free
[5:26] >> wow
[5:26] >> and it'll give me every entry and exit
[5:28] point I did every trade and how your P&L
[5:31] looks over time for whatever time period
[5:34] you choose and then if you like it you
[5:36] click and you run the algo and that's
[5:38] pretty cool right
[5:39] >> you know so it's great having you know
[5:40] but then again it's great having great
[5:41] tools but you have to teach people how
[5:43] to use them
[5:43] >> now as the retail tools increased in
[5:46] efficacy did the big bad Wall Street
[5:49] firms the citadels of the world etc
[5:51] tools obviously have increased as well
[5:52] so do you think that um they still have
[5:54] an advantage but maybe it's a little bit
[5:56] more of an even playing field
[5:58] >> it's much more even their advantage is
[6:00] still maybe in speed.
[6:01] >> Mhm.
[6:01] >> Right. So, we're we're pretty quick, but
[6:03] we don't have our bare metal servers,
[6:05] you know, three cm away from where the
[6:08] matching engine is, cuz we don't need
[6:10] super super microscond or um speed, but
[6:13] certainly the tools are at a par of
[6:15] where it was 5 years ago.
[6:17] >> I mean, that's pretty crazy, right?
[6:18] >> And then with aentic AI and everything
[6:20] else, it really has leveled it to the
[6:22] point.
[6:22] >> Mhm. Now, when you look at you guys
[6:24] versus many of the other retail trading
[6:26] platforms, what do you think the big
[6:27] differences are? Why have you guys had
[6:28] so much success? Well, so the the fourth
[6:30] thing is that that we lack if we go back
[6:32] to that for a second. So is that is um
[6:34] information access tools and then it's
[6:37] really uh risk discipline, right? Human
[6:39] beings are generally terrible traders on
[6:41] your own. So when I sat at Gas or JP
[6:44] Morgan, I was in a big trading floor
[6:46] with 500 smart people trading somebody
[6:49] else's money. That's kind of
[6:50] >> that's an easier thing to do than to be
[6:52] sat at home with your own money trading
[6:55] to try and build a financial future for
[6:57] yourself. stuff.
[6:58] >> You know, human beings are emotional
[7:01] >> um emotional beings.
[7:04] >> Um FOMO,
[7:07] uh risk aversion, all the huristics from
[7:09] the Chicago school, all that, you know,
[7:11] Tanaman, Cannaman and Terski stuff. Uh
[7:14] it's tough to trade cuz even when I
[7:16] trade on my own, so when I've had to
[7:18] leave a company and have a three or six
[7:21] month garden leave, I'm trading my own
[7:23] money. Terrible. Awful. Interesting. I
[7:25] chase stuff and I panic out and cuz it's
[7:28] tough. So what we have is this 29
[7:30] million people distributed
[7:33] uh crowdsourced risk management kind of
[7:36] um desk of people. So you'll see people
[7:39] when our biggest influx of cash was uh
[7:41] liberation day last year really just
[7:44] came and they bought the dip and I was
[7:45] on the Nvidia chat and it's every second
[7:48] someone's saying something but this is
[7:49] someone in Tokyo in Hong Kong in
[7:50] Singapore in Australia in Canada or in
[7:53] the US and I was like what do I do here
[7:55] and they're like no guess below 100
[7:56] we're all buying and it's there's like a
[7:59] it's like having a trading floor of
[8:00] people to speak to so you don't I always
[8:02] before I trade I say what do you think
[8:04] and I'll send my trades out I'll send my
[8:06] port portfolio out. I'll send my algos
[8:08] out and people will take the time to run
[8:11] them themselves and change parameters
[8:12] and say, "Hey, here's an extra 400 basis
[8:14] points if you change this."
[8:16] >> Interesting. And so this social
[8:17] component is something that most of
[8:19] these other platforms do not have.
[8:20] Explain a little bit more as to how this
[8:21] works.
[8:22] >> So it's something it's a bit like
[8:24] Wikipedia against Carter, right? Some
[8:27] things are organic and can't be replaced
[8:29] and some things you can't just throw
[8:30] money at. So we started this back in
[8:32] 2013 just to make it like a a chat room
[8:34] for people to share ideas. One of the
[8:37] one of the main uh tenants in the firm
[8:38] is to make investing easier but not
[8:41] alone.
[8:42] >> And that's super important. Um I know as
[8:44] I said I'm a terrible trader when it's
[8:46] I'm actually on my own and not talking
[8:48] to other people, not bouncing ideas off
[8:50] people. I I'll panic. I'll do all the
[8:53] all the trader stuff that traders do.
[8:55] Same things I do. [laughter] So this
[8:57] this community aspect is really really
[8:59] important. It's um I'm on there every
[9:01] single day. I have thousands of people
[9:02] who follow me. I follow thousands of
[9:04] people and I have people I really trust
[9:06] and I'll go what are we doing here? What
[9:08] are we thinking? Is this important?
[9:10] >> I'm thinking about behind these calls
[9:11] and I'll get and wait until this level
[9:14] before I buy them. You know what we
[9:16] think uh or you know I'm think where's
[9:18] my exit point here? So I'm trading
[9:20] options and where's my exit point and
[9:22] they go we think it's here.
[9:23] >> So it's it's like being on the trading
[9:25] floor but this is people around the
[9:27] world. Yeah. Now do you think at some
[9:29] point uh you'll also be asking the AI
[9:31] like it right now you're talking to
[9:33] humans do you think that AI will also be
[9:35] fast enough good enough etc to
[9:37] >> I think so yeah
[9:38] >> it's interesting right because you start
[9:40] AI and humans
[9:40] >> because we have AI on the platform it
[9:42] does some fun stuff some of the some of
[9:44] the LLM stuff we've got like for example
[9:46] uh if you like if you're a technical
[9:47] trader you like double tops or head and
[9:50] shoulders
[9:51] >> you just pick one of 26 strategies you
[9:54] click on it and in a second it finds
[9:56] every stock in the universe that has the
[9:58] setup and shows where it's drawn.
[10:00] >> So that's great for entry and exit
[10:02] points.
[10:02] >> Mhm. So, so explain this a little more
[10:04] because I think this is like a very
[10:06] fascinating way to think about retail
[10:08] investing is um information and
[10:12] education has drastically increased. Now
[10:13] you got somebody at home who says, "Hey,
[10:14] I like uh double tops." Yeah.
[10:16] >> Okay. I I look I spend hours a day
[10:19] trying to find stocks that are, you
[10:21] know, in this uh specific formation. Um,
[10:23] now they can basically say to the
[10:25] system, go find me every double top in
[10:27] the US listed public stock market.
[10:29] >> You just click it and it just it goes
[10:31] and it's in it's instant
[10:33] >> and then wish just like another click or
[10:34] two to be able to just buy
[10:35] >> and then you just click on it and it say
[10:37] what do you want to do here?
[10:38] >> Mhm.
[10:39] >> I mean it's it's you couldn't do that as
[10:40] a human being.
[10:41] >> Yeah. I mean you're you're basically
[10:43] automating what is uh hours and hours of
[10:46] uh time but also frankly prone to
[10:49] mistakes.
[10:50] >> Yeah. Right. Right. I mean, you know,
[10:51] I'm very
[10:52] >> human beings are really good at like
[10:53] seeing patterns that aren't there.
[10:54] >> That's what I mean. You want to you want
[10:56] to you want to buy, you'll find
[10:57] something to tell you that it's
[10:59] >> uh they say technical analysis is just
[11:01] astrology for men, right? You just draw
[11:03] the lines everywhere. Um but I kind of
[11:04] think of it like with doctors, right?
[11:06] like uh now AI is doing more and more
[11:08] reading of X-rays and there's still a
[11:10] doctor involved but the X-ray AI system
[11:14] is able to pick up things that the
[11:15] doctor may miss or maybe the doctor's
[11:17] just tired or you know been a long day
[11:20] or whatever. To me that's where AI
[11:22] becomes really really interesting is
[11:23] it's augmenting the human which sounds
[11:24] like kind of what you guys are doing
[11:26] where you're basically saying the human
[11:27] has an idea it tells the system to go
[11:29] find a bunch of stuff and then the human
[11:30] is the oversight and and double-checking
[11:33] and saying yes confirm I want to do
[11:34] this.
[11:34] >> Yeah. I always get the do you want to
[11:36] trade yes or no? There's always a
[11:37] confirmation part to any kind of uh
[11:40] trade that's kind of suggested or
[11:41] whatever. Um but it's tough cuz it's um
[11:45] you know I came here I was on the
[11:47] subway. I was still on my phone. I was
[11:48] on Twitter and stuff. I was reading some
[11:50] of your stuff. We just were bombarded
[11:53] with information more so now than at any
[11:55] time in history. Just bombarded with
[11:57] opinions, views, information, data. Um
[12:00] so what AI does on our platform anyway
[12:02] just cuts through that. tries to make
[12:04] signals to give you actionable things to
[12:06] do. you know to it will suggest to you
[12:08] here's the summary from uh from you know
[12:11] the filings from you can even ask it the
[12:13] earnings report what was different in
[12:15] this earnings earnings um announcement
[12:18] than the last one
[12:19] >> and I can't do that I'm not going to go
[12:21] through every announcement listen to
[12:22] listen to the earnings call for the last
[12:25] three or four quarters that's just too
[12:26] much work but you can do that with AI so
[12:28] it just cuts down your research time
[12:32] >> you guys have all of the traditional
[12:34] assets you also have crypto on the
[12:35] platform
[12:36] >> crypto
[12:36] talk a little bit as to what do you see
[12:38] users actually doing on the platform?
[12:40] Are they mostly equities? Are they more
[12:42] crypto traders? Are they international,
[12:44] domestic, just like what are some of the
[12:45] patterns?
[12:46] >> Yes. So, so our guys are generally the
[12:48] uh stock guys. Uh our clients tend to be
[12:51] like buy and hold and longer term. Um we
[12:54] have more of those than kind of the
[12:55] in-n-out active day traders. And so for
[12:58] crypto, we find it's people who want to
[13:00] make it 5 10% of their portfolio. So
[13:02] they buy it through fiat. They don't
[13:04] have to have a wallet. It's in their
[13:06] account. They look at their account and
[13:08] even though it's it's, you know, in in
[13:11] digital form in in their daily
[13:13] statements on the phone, it just looks
[13:14] like stock.
[13:15] >> Mhm.
[13:15] >> And they buy it with fiat. We do the
[13:16] conversions. We do all the packing
[13:18] stuff.
[13:18] >> And we actually funny off the talk about
[13:21] like digital stuff and tokenization. So
[13:23] the big deal happened in February, the
[13:26] the first um SEC blockchain native thing
[13:29] with Mike Kagny figure. So, we were the
[13:32] >> I I'm an investor figure and u you're a
[13:34] big fan of my cat. So, that was fun to
[13:36] see.
[13:36] >> I was talking to I was talking to him
[13:38] yesterday. Um so, we he had there was a
[13:40] tight deadline for the S1. It ran out on
[13:42] I think Feb 16th. U they only got the
[13:45] okay on the Thursday before and we were
[13:48] the only broker with the technical
[13:50] ability to make that happen.
[13:52] >> Interesting.
[13:53] >> So, on our platform, you buy it with
[13:54] stock. You just it's a US dollar asset
[13:57] on our platform. on the back end we
[13:59] convert to YLts and then we get it
[14:01] minted on open platform on on on figure.
[14:04] So the only place you can buy it outside
[14:07] of figure ATS is through MU.
[14:09] Interesting.
[14:10] >> So so we did that and we think there's
[14:11] going to be many more of those.
[14:12] >> I was going to say do you think that
[14:13] over the next five or 10 years like what
[14:15] percentage of the stocks that people are
[14:17] buying on your platform will be
[14:18] tokenized versions versus kind of the
[14:20] traditional electronic us?
[14:21] >> I think Mikey would say 100%.
[14:24] >> 100%. Yeah.
[14:25] >> Um we're just hoping maybe with uh
[14:28] things like OpenAI and you know um and
[14:31] the the big IPOs coming that those guys
[14:33] are fairly technically advanced in it
[14:35] would they would make some portion of
[14:36] those blockchain native you know so I
[14:39] mean we we took down a third of the IPO
[14:42] >> our clients so I actually asked our
[14:44] client why did you buy it? They there
[14:45] was they wanted to be to buy the first
[14:47] ever SEC registered tokenized security
[14:50] on on the platform. And then also you
[14:52] can earn yield, right? There's no, you
[14:54] know, if I've got $10,000 of Nvidia, I
[14:56] can't do anything with it, right? I can
[14:58] pledge it for a margin loan, great. But
[15:00] I can't pledge it for a home loan, I
[15:02] can't take cash out against it. Uh if
[15:04] the stock loan gets tight, I get no
[15:06] yield. Mhm.
[15:06] >> But if I own the if I hold the um the
[15:09] blockchain native token, I can enter
[15:11] into a smart contract either on Figure
[15:13] or another platform, earn yield. Um I
[15:16] can take that and um take cash against
[15:18] it. I can use as a home loan. You know,
[15:21] it's got utility to me that just a stock
[15:23] in a stock um portfolio has very little
[15:26] utility apart from collateral for
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[17:44] It's fascinating to see. Um on one hand
[17:46] you've got crypto assets that are trying
[17:49] to get into the regulated system. On the
[17:51] other hand you've got things like a
[17:52] hyperlquid or something right that's
[17:53] trying to basically create uh the like
[17:56] cryptonative decentralized you know
[17:58] version and both are working. I think
[18:00] that's the part like to me that's the
[18:02] biggest thing is it's not either or it's
[18:03] both it seems
[18:04] >> and you saw on you know one of the
[18:05] biggest traded contracts on hyper liquid
[18:07] was oil. So people like permissionless.
[18:09] There'll be a certain sector of the
[18:11] investor base and the client base who
[18:12] always want to do permissionless stuff.
[18:14] And then there's people who want to
[18:15] trade on a platform that's secure,
[18:17] that's guaranteed they can and they're
[18:19] used to using the tools for stocks. Um
[18:22] so what we didn't rush into crypto, we
[18:24] took our time.
[18:25] >> So we wanted to try and um you know
[18:28] bring some rigor, discipline,
[18:29] transparency to the process and just
[18:31] make trading crypto just like trading
[18:33] stocks.
[18:34] >> What about with the options? Like it
[18:35] seems like retail investors have, you
[18:36] know, really flocked to options trading.
[18:38] Um zero day options now are the most
[18:40] popular option. Um there's, you know,
[18:43] potential pitfalls with so many people
[18:45] trading options, but it does feel like
[18:46] this is a huge part of uh the market.
[18:48] >> Yeah, we we spe our option product is
[18:51] probably the strongest product we have
[18:52] and that's kind of our one of our
[18:54] advantages over the some of our
[18:55] competition is some of the tools we
[18:57] have. We have so I've been trading
[18:58] options for 35 plus years. You know,
[19:01] people say AI and tools will take your
[19:03] job. All my knowledge is worth zero
[19:06] right now. All that experience is worth
[19:08] nothing.
[19:08] >> We have a thing called option strategy
[19:10] builder where you say I'm very bullish
[19:12] bullish, neutral, bearish, very bearish.
[19:15] >> You can set a slider for your risk
[19:17] tolerance um for your um for the tenor
[19:20] you want to go out and it will just
[19:21] build you the strategy and show you all
[19:25] the payoffs all in um image format. And
[19:29] then you can just uh slide the strike
[19:31] slide um whether you want to take more
[19:33] risk or less risk and it will build a
[19:35] strategy and you can click trade it
[19:37] straight through the interface. So it's
[19:40] almost uh obiscating away some of the
[19:42] technical components of it and you're
[19:44] more so the user interface is making it
[19:46] much easier to interact with
[19:46] >> because you can just see your payoffs
[19:48] and then for zero DTES as you know you
[19:50] know gamma goes to infinity
[19:52] five to four and so one thing we have we
[19:55] have a trading stop on zero DTE
[19:58] >> so I use that I never enter into a zero
[20:01] TT but a trading stop especially because
[20:04] you want to catch that wizoo right you
[20:05] want to go it's 10 cents it's not it's a
[20:07] $150 um but then It's $150 and it's 10
[20:10] cents again.
[20:10] >> So I use tra I use our trading stops
[20:13] >> so I know if it goes up and it's down by
[20:14] 10 I'm out.
[20:15] >> Yeah. How important is it that you're
[20:16] trading on the platform as well?
[20:18] >> I make all the mistakes. So like this is
[20:20] what the uh your normal average uh
[20:22] trader will do. So I I use it and you
[20:25] know we have everything we do is we have
[20:27] this system called andon. I think it
[20:28] came from Toyota that um every change we
[20:31] make is driven by clients. So people
[20:33] make suggestions, I make suggestions
[20:35] that goes when it's a certain level goes
[20:37] straight to our product guys and then
[20:38] they start. So it's not we it's not like
[20:41] I'm thinking this would be a great
[20:42] feature. It's when people ask for the
[20:43] features.
[20:44] >> Mhm. Mhm. Yeah. But you as the uh leader
[20:48] of the business, you are like touching
[20:50] the problem, right? Yeah. Yeah. It feels
[20:53] like that would be pretty important.
[20:54] >> Yeah. So I I make suggestions and we can
[20:56] do this better. Here's what I'd like to
[20:57] see. And then it goes we to a group of
[20:59] people. We discuss and then Yeah. But we
[21:02] we actually turn out product really
[21:04] quickly. We got 4,000 you got 4,000
[21:07] people um globally 3,000 of them are in
[21:10] product development and um yeah product
[21:13] and dev.
[21:14] >> You've made a huge push into these IPO
[21:16] allocations and really advocated for
[21:18] retail investors to get bigger and
[21:19] bigger portions. What have you seen
[21:21] there in that effort? Yeah, I mean we've
[21:22] had most success with with people like
[21:24] Mike Kagny, Mike Bell because they're
[21:26] disruptive people by nature. And so they
[21:29] look at, you know, they made their money
[21:30] by looking at a a legacy ecosystem
[21:32] saying that doesn't make sense. I can do
[21:34] that better, cheaper, faster. Um so they
[21:37] look at the, you know, um you go to an
[21:40] investment bank and you have to pay them
[21:42] to tell you your price should be this so
[21:44] they can send it to their institutional
[21:46] um clients and there's a conflict of
[21:48] interest there or people can see that as
[21:50] a conflict of interest. So we went
[21:52] directly to these guys or we went
[21:53] through uh some of the banks. We said
[21:55] listen um we can show you all the data.
[21:57] Retail is not the idea the narrative
[21:59] that retail is a flipper is not the
[22:01] case. So we have all the data. If I take
[22:04] a figure or bullish for example we've
[22:06] been net buyers of the stock every week
[22:08] since the IPO.
[22:09] >> Interesting.
[22:10] >> So we have more people who hold the
[22:11] stock now than actually we got
[22:13] allocation for.
[22:14] >> Yeah. I mean great great for those
[22:15] businesses. Right.
[22:16] >> And we and we get huge amounts of
[22:17] demand. Bitco $200 million deal. Well, I
[22:20] know it's down uh from its its price,
[22:22] but we had like almost $700 million of
[22:25] um demand.
[22:26] >> Wow. Um you've been friends with Jordi
[22:30] Visser for a long time. Jord's a star of
[22:32] the show. We might have to change it to
[22:34] Pomp and Jordy show. Um but
[22:36] >> Jordy and Pompa maybe.
[22:38] >> Yeah. At this point, why even have my
[22:40] name in it? This is a Jordy show. Um
[22:42] talk a little bit about the early days
[22:44] of Morgan Stanley and your career and
[22:46] kind of what you learned there. And then
[22:47] also I think Citadel is a pretty
[22:49] interesting place that you know most
[22:51] people with your pedigree and experience
[22:54] they don't kind of flip over on the
[22:55] other side of the table and I think it's
[22:56] very fascinating. You worked at some of
[22:58] these places that are you know uh very
[23:00] well respected for a long time for the
[23:02] culture they built the quality of the
[23:03] people the tools they built. So talk a
[23:04] little bit about that.
[23:05] >> Yeah I what I remember about Gman's
[23:08] Morgan Stanley JP Morgan said I think
[23:10] culture was the main thing. There was a
[23:12] culture of excellence of uh being humble
[23:15] um never thinking you're right all the
[23:17] time collaboration. So when I joined
[23:19] Goldman there was maybe 4,000 people
[23:21] globally when it was still a partnership
[23:23] >> and it felt like you were part of
[23:25] something that that was really really
[23:26] important to me and I've been looking to
[23:28] work at places that have had that kind
[23:29] of
[23:30] >> uh it doesn't feel too corporate.
[23:33] Obviously they're large banks but you
[23:34] know within groups of people you're
[23:36] working with very smart people who are
[23:38] all trying to get to the same point.
[23:39] >> Mhm. So, uh, Mumu is is exactly like
[23:42] that. It feels like a startup. It feels
[23:44] exciting. So, when I've been at the
[23:46] banks, I've always done the more cutting
[23:48] edge stuff. So, with Jordi, when I was
[23:49] at Morgan Stanley, uh, we were index
[23:51] option traders together. I was doing
[23:52] Europe, he was doing the S&P,
[23:54] >> and then when the, um, when the ISC was
[23:58] formed in 99, the first electronic
[23:59] options exchange, uh, I co-led that
[24:02] group. So, I got into the automated
[24:04] market making, and then that led to the
[24:06] the quant algo trading at Citadel and at
[24:08] JP Morgan. built globally their
[24:10] electronic market making business. So
[24:12] the tools to trade have always been
[24:13] something I've been interested in.
[24:15] >> And then that kind of was natural when
[24:17] it comes to someone like Mumu that feels
[24:18] like a startup. Um a bunch of super
[24:21] smart people all working really hard. Uh
[24:25] a lack of egos. It's it's it's the
[24:27] favorite place. It's I would say it's
[24:29] it's my favorite place to have worked in
[24:31] all of my career. Yeah.
[24:32] >> Wow. And when you think about uh this
[24:36] business, I think one of the things
[24:37] that's really interesting is you've got
[24:38] a lot of fronts that you've got to uh
[24:40] kind of manage, right? You've obvious
[24:41] got the internal team and the culture
[24:42] and things that every business has to
[24:44] deal with. You're building technology.
[24:46] So there's all the product and dev work
[24:48] that you got to do, but you're building
[24:49] it in a dynamic environment where, you
[24:51] know, 10 years ago crypto wasn't a thing
[24:53] really uh for a lot of these platforms.
[24:55] Now it's tokenization, prediction
[24:57] market. I mean, it's just every day
[24:58] there's something new. And then you've
[24:59] also got to deal with regulation on top
[25:01] of that. And so talk about how do you
[25:03] like like what does your normal day look
[25:05] like? How do you handle so much
[25:06] complexity?
[25:07] >> I think that's a good point. So we're a
[25:09] fintech company but we're a broker
[25:10] dealer, right? So it's it's you can't be
[25:12] like a fintech that just throws things
[25:13] against the wall and breaks things and
[25:16] because you can't cuz if you break one
[25:17] thing and people can't trade, you're out
[25:18] of business, right? And then you know
[25:20] we're regulated by FINRA uh registered
[25:23] with the SEC. Um so we you know a large
[25:26] part of our US offers is compliance,
[25:28] >> right? [clears throat] So it's
[25:29] protecting the customer. um AML stuff.
[25:32] So, we're we're super tight on that
[25:34] stuff. It's a useful discipline to work
[25:36] within a highly regulated environment.
[25:38] It protects our clients. It protects us.
[25:40] Um and so, we're trying to bring that
[25:42] kind of as I said, rigor, compliance,
[25:44] transparency, discipline. I'm trying to
[25:46] bring that to new new classes. It's the
[25:48] first time in history I've never know. I
[25:50] don't know what next year will look
[25:51] like. It's super exciting.
[25:53] >> It's exciting, but it's also you got to
[25:55] try to figure it out. So, like what how
[25:56] do you try to figure it out?
[25:57] >> Yeah. So uh not rushing in not rushing
[26:00] into the next. So we we think long and
[26:02] hard. We think uh why us? Why this? Why
[26:05] now?
[26:05] >> And so they have those three questions
[26:07] have to be have to be answered. Is it
[26:09] the right thing for our clients? Is it
[26:11] the right timing for us? Are we the
[26:12] right people to do this? Can we deliver
[26:14] something different?
[26:15] >> Mhm. And so when you look at these new
[26:17] technologies that are coming out, uh one
[26:19] of the other things I think is really
[26:20] interesting is like who the quotequote
[26:22] retail investor or this like I call them
[26:24] independent investor is has really
[26:25] changed. It used to be, you know,
[26:26] somebody with five bucks. These people
[26:29] are wealthy now.
[26:30] >> These people are wealthy.
[26:31] >> Talk a little bit like who that user is.
[26:33] >> Yeah. I mean, it's that 25 to 42. Uh
[26:36] some of the money's come down from their
[26:37] parents. You know, there's that whole
[26:38] waterfall from uh from the boomers,
[26:41] >> but they're smart. I mean, they're not
[26:42] your average. They're not the retail
[26:44] investor of even 10 years ago.
[26:46] >> Um again, it's about educating yourself.
[26:48] So, you know, you can have all the best
[26:50] tools in the world, but if you don't
[26:51] teach people how to use them, they make
[26:53] it makes no sense. M so our our
[26:55] investors say our average AUM is much
[26:58] higher than our US competition. Um they
[27:01] tend to be buy and hold. They're not
[27:03] they don't they're not going crazy on
[27:05] zero DTE. They have the tools and we do
[27:07] have uh some active traders on the
[27:09] platform. Uh but generally
[27:12] um the I'm always amazed by their
[27:14] fortitude, right? they and that's part
[27:16] of being in the community stuff. But we
[27:18] have people who've bought Nvidia Jan 23
[27:21] at like below 20 bucks and all they've
[27:23] done is buy dips all the way down and
[27:26] then when it's a bit extended they'll
[27:28] sell sell credit spreads when it's
[27:29] coming off again they'll sell you know
[27:31] um put spreads so they're pretty
[27:34] sophisticated they're sophisticated they
[27:36] don't panic
[27:37] >> you know that's um you know I kind of
[27:40] make the joke that uh my wife's not
[27:42] going to fire me from my 401k right if I
[27:44] have a bad quarter but you know if you
[27:46] if you're an opponent millennium or your
[27:48] overleverag hedge fund. You have a bad
[27:50] quarter, you're out, you're down 5%,
[27:51] you've lost, right? So my um our clients
[27:55] will take draw downs and see it as
[27:58] opportunity. Talk a little bit more
[28:00] about like take the pods, right? And
[28:01] whether Citadel or anywhere else um or
[28:03] Millennium um I don't think people quite
[28:06] understand the risk limits and how uh
[28:09] kind of unemotional the decision-m there
[28:11] is. So so talk just a little bit.
[28:12] >> It's completely automated. So if you're
[28:13] a PM and you're running a strategy, you
[28:15] have to show your sharps above like 2.6
[28:17] I think it is for for say millennium. I
[28:20] don't want to quote Izzy here, but 2.6
[28:22] is 10. You know, you have to show a
[28:23] track record and then they'll give you
[28:25] money. Absolutely. And if you do well,
[28:27] you get paid.
[28:28] >> The downside is they start to gate you
[28:30] down two and a half, three and down
[28:32] five, you're out and they just stop you
[28:34] out and you wipe down.
[28:35] >> Yeah. So like let's say you're I don't
[28:37] know made $100 million. Once you're down
[28:39] 5% it's over.
[28:41] >> That's over.
[28:42] >> Yeah. And it's really a culture of
[28:44] >> I mean if you're up you know if you're
[28:45] up a 100 I think they scale it. So but
[28:48] if you're down five below average zero
[28:50] then you definitely are.
[28:51] >> Yeah. And so it's interesting because
[28:53] they're doing this across you know in
[28:54] some cases hundreds of pods and it
[28:56] really just becomes this like automated
[28:58] big risk mitigation you know.
[29:00] >> It's great. I mean it it's you know
[29:02] they're getting paid on the picks and
[29:03] shovels and other people are taking a
[29:05] risk.
[29:06] >> Mhm.
[29:06] >> So it's a great business model.
[29:08] >> Mhm. Yeah. That's pretty uh it's pretty
[29:09] interesting
[29:09] >> assuming that you've got really tight
[29:11] risk limits and that you can liquidate
[29:12] down five.
[29:13] >> Well, that's the other thing you get
[29:14] into these correlations and you know um
[29:16] I I always uh I yearn for the old school
[29:20] like cowboy risktakers.
[29:22] >> They're they're not working in any pod
[29:23] shops, right? Because these guys might
[29:24] go down 20% and you know make it all
[29:26] back in a single trade. Um, but I do
[29:28] think that the rise of the pod shops
[29:31] mirrors the rise of the sophisticated
[29:32] investor where everyone is becoming much
[29:35] more informed and understands some of
[29:38] the pitfalls of financial markets
[29:40] together. Um, and you know, Twitter X
[29:42] has been a huge part of that. But, but
[29:44] it does feel like the pod shops have
[29:46] really hit their stride and become super
[29:48] sophisticated. Retail has as well.
[29:50] Again, it's not saying a retail investor
[29:52] is like a pod shop, but um there just
[29:54] feels like overall the market is getting
[29:56] smarter.
[29:57] >> Yeah. I mean, again, it's an education
[29:59] process. We've got 2,000 videos and
[30:01] stuff on the platform trying to take
[30:03] people from,
[30:04] >> you know, trading 101 to to using algos
[30:07] to using uh back testing environments to
[30:09] using the tools. The gap between the guy
[30:11] at Millennium Citadel and the
[30:14] sophisticated retail retail trader has
[30:16] never been narrower and AI is making
[30:18] that really really tight. Interesting.
[30:20] What What do you like lay awake at night
[30:23] over? What What What are the challenges?
[30:25] >> Um
[30:27] >> other than the Mets not being good or
[30:30] the Mets being seven and 11. Just
[30:32] kidding.
[30:32] >> They've got to play one more game in in
[30:34] LA as well.
[30:36] >> As a Yankees fan, I can, you know, give
[30:38] a little
[30:38] >> They're going to be They're going to be
[30:39] seven and 12.
[30:41] >> They're going to be seven and 12 by this
[30:42] evening. [laughter]
[30:43] >> I I won't be watching the late game
[30:45] tonight. Um uh regulation whereas that's
[30:49] going clarity act I really care about.
[30:51] Regulators are having to move quicker
[30:53] than I think it makes them comfortable.
[30:55] The the world is changing so quickly.
[30:58] >> We got lots of initiatives with the AI
[31:00] stuff and with our tools. Um and it's
[31:03] just can can we keep up? Can we keep
[31:06] giving our guys the tools that they
[31:07] need?
[31:08] >> Mhm. So, you know, we we we most of our
[31:10] money goes in R&D and product
[31:12] development and we're just hoping that,
[31:14] you know, we keep telling
[31:15] >> the engineers like super AIDS and
[31:17] they're all just like running wild with
[31:18] all the models and everything.
[31:19] >> So, we have some like that and we have a
[31:21] whole section there. We got remember we
[31:23] we've got to run a broker dealer. So, we
[31:24] need the safe boring infrastructure
[31:27] >> um sci stuff all the stuff you need and
[31:30] then we've got the more fun stuff which
[31:32] is the AI
[31:33] >> um and the people coding the fun stuff.
[31:36] But a lot of it is just making sure
[31:37] we're up all the time like for for
[31:40] figure for the we make marketers 245 in
[31:43] the we make marketers we give access 245
[31:45] to figure D to the token.
[31:47] >> Mhm.
[31:47] >> So that was a big step for us and then
[31:49] so we we have to be up all the time. So
[31:51] >> my worry is uh at some point something
[31:54] happens and we go down.
[31:55] >> Do you sleep?
[31:56] >> I do sleep. Yeah. Yeah. I sleep a lot
[31:58] more as CEO of Muma than I ever slept at
[32:00] Citadel Jim World. Why?
[32:02] >> Cuz I'm not running risk.
[32:03] >> I'm running risk. I care about my my
[32:05] clients and reputational risk and they
[32:07] make sure the platform's up.
[32:08] >> Yeah. Yeah. But not like a book.
[32:10] >> Not like a book. Yeah.
[32:11] >> Yeah. Yeah. That's interesting though
[32:12] that actually there you felt much more
[32:15] uh kind of pressure to uh on the risk
[32:17] side of the the book versus the uh
[32:19] >> Yeah. I mean especially because there's
[32:21] so much more information at weekends
[32:23] now.
[32:24] >> So if I was running a huge global
[32:26] options book and then you know something
[32:28] happens on a Saturday
[32:30] >> we got a guy at the White House. He
[32:31] likes to do stuff on Friday, Saturday,
[32:32] [laughter] Sunday. You know, I mean I
[32:34] would he suspiciously waits till market
[32:36] clos on Friday and starts firing off
[32:37] information.
[32:38] >> I would never be not running slides.
[32:39] >> Yeah. You know, but back then you
[32:42] mentioned Monte College before.
[32:43] >> We used to run those overnight
[32:45] >> on bare metal servers,
[32:47] >> right? [clears throat] Um and the fact
[32:48] on our platform you can click and just
[32:50] run a whole back test is is
[32:52] >> crazy. Yeah. Yeah. That's
[32:54] democratization right at it finest.
[32:56] >> And then you you can share them with
[32:57] people.
[32:58] >> Yeah. Yeah. So you see you see in our
[32:59] chat every day if you take video people
[33:02] just pulling their trades up and their
[33:03] wins, their losses
[33:05] >> and there's a feeling of being part of
[33:06] something, you know, in a big trading
[33:08] venue.
[33:09] >> Yeah.
[33:09] >> Uh rather than just being in your
[33:10] bedroom or in the kitchen or
[33:12] >> Yeah. I love it. I love it. All right.
[33:14] Well, thank you for taking the time to
[33:15] do this. If you guys want the best
[33:17] trading experience, go to Mumu. Go check
[33:18] them out and we'll do this again in the
[33:20] future.
[33:20] >> Anthony, thank you.