Jun 27, 2026 · 54m · news
How We Got Fred Wilson, Benchmark and Index to Invest $94M | Why Robinhood's Strategy is Wrong · 20VC with Harry Stebbings
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In this episode of 20VC, host Harry Stebbings interviews FOMO co-founder and CEO Paul Erlanger to discuss the platform's social-first trading model, its unconventional path to raising $94M from Benchmark, Index, and USV, and why legacy fintech strategies like Robinhood's horizontal expansion are fundamentally flawed.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Harry holds 28.3% of the talking time here. How this is scored →
Harry as informed peer 4.3 Guest teaching 3.7 Guest disagreement 1.9 Harry pushing back 2.9
speaking balance: gold is Harry, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 10:40 Rejecting the Casino Framing
Paul directly pushes back against Harry's premise that public markets are becoming a wild west casino, labeling 'casino' a derogatory term and asserting that retail coordination empowers traders against institutional hedge funds.
Hardest push from Harry ▶ 10:07 Challenging Market Casino-izationHarry aggressively presses the guest on whether retail social media exuberance and meme-stock volatility are driving a dangerous detachment from market fundamentals.
Biggest teaching moment ▶ 7:56 Explaining Pre-IPO Perpetuals MechanicsWhen Harry asks what a pre-IPO perpetual contract is, Paul breaks down synthetic pricing, side bets, and price convergence using real-world market examples that educate the host.
Harry holds his own ▶ 36:34 Masterclass on Immortal Brand AssetsHarry takes full control of the narrative by laying out his framework for 'immortal brand assets' versus transient ads, backing it up with concrete podcast and sports sponsorship examples that prompt the guest to ask for more insights.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Harry as informed peer | Guest teaching | Guest disagreement | Harry pushing back | Why |
|---|---|---|---|---|---|---|
| What Motivates Paul Erlanger? | 2 | 2 | 1 | 1 | Harry opens with questions on founder motivation and company structure before asking about FOMO's 140-angel round. Paul collaboratively explains their early distribution strategy and Aaron Harris's advisory role without conflict. | |
| Scaling to the First 1,000 Users through Feedback | 3 | 4 | 2 | 3 | Harry queries scaling to 1,000 users and asks why the financial super-app model is flawed. Paul reframes the question, explaining that super apps lack intentionality whereas FOMO leverages the social graph to link trades across market types. | |
| Understanding Pre-IPO Perpetuals | 2 | 6 | 1 | 2 | Harry interrupts to ask for a basic definition of pre-IPO perpetual contracts. Paul educates the host on synthetic price bets without underlying asset transfers using SpaceX and Cerebras as concrete examples. | |
| The Rise of Retail Speculation and "Casino-ization" | 4 | 5 | 5 | 5 | Harry strongly challenges Paul on whether public markets are turning into a detachment-from-reality casino driven by retail exuberance. Paul explicitly rejects the casino label, calling it derogatory and arguing that retail coordination empowers investors while all financial assets are inherently speculative. | |
| Benchmark Series A and the No-Pay Bet | 3 | 3 | 2 | 4 | Harry presses Paul on what generous equity allocation actually means in figures when the early team worked unpaid for eight months. Paul clarifies their founding equity split and shares the story of meeting Benchmark partner Peter Fenton. | |
| VC Selection, Fundraising Strategy, and the CEO's Role | 6 | 2 | 1 | 3 | Harry demonstrates strong VC domain expertise by advising founders on managing inbound VC noise and warning against expecting VCs to do core engineering hiring. Paul agrees, elaborating on CEO responsibilities. | |
| Scaling and Keeping a Lean Headcount | 5 | 3 | 2 | 4 | Harry highlights the paradox between tech narrative around AI replacing engineers and every founder citing hiring as their bottleneck. Paul resolves the tension by explaining that top-tier engineers are more valuable than ever as architects. | |
| The Reality of AI-Enabled Engineering Speed | 7 | 4 | 2 | 5 | Harry cites Uber and Microsoft questioning AI productivity gains and presents detailed industry calculations on developer token spend versus enterprise valuations. Paul details how internal senior engineers use AI to rapidly prototype complex front-end features in weeks. | |
| The Growing Importance of Human-Centric Design | 4 | 4 | 2 | 2 | Harry asks whether design software like Figma or fast prototyping tools like Lovable will win in an AI-driven workflow, and why no major social app has launched since Snap. Paul explains the need for human control in UI design. | |
| Lessons from Be Real & Creating Growth Loops | 4 | 4 | 1 | 3 | Harry suggests FOMO should build a viral media arm around extreme retail trading gains. Paul details FOMO's growth mechanisms, share cards, and internal network of 30 to 40 content creators. | |
| CAC vs. LTV and the Power of Brand Marketing | 8 | 2 | 1 | 2 | Harry delivers an authoritative breakdown of 'immortal brand assets' versus transient advertising using podcast archives and football shirt sponsorships as examples. Paul actively listens and asks for additional examples. | |
| Immortal Brand Assets & Transitioning to a Numbers Game | 4 | 3 | 1 | 2 | Paul shares the backstory behind FOMO's $75M Series B led by Index and USV at a $550M valuation. Harry lightheartedly laments missed VC investments due to partner holidays. | |
| Managing Volatility and the Buy vs. Build Playbook | 5 | 4 | 2 | 3 | Harry brings up Brian Armstrong's insights on crypto market volatility affecting company morale and questions why US fintechs haven't matched Revolut's global footprint. Paul explains their strategy to build core infrastructure in-house. | |
| Quick Fire Round: Social Momentum and Robinhood vs. Revolut | 5 | 3 | 4 | 5 | During the quick-fire round, Paul advises computer science students to use less AI to preserve foundational skills. Harry directly disagrees, arguing students should use AI heavily, leading Paul to playfully remind Harry that he is not an engineer. | |
| Rejecting 996: Fostering Autonomy and Ownership at FOMO | 3 | 4 | 2 | 2 | Harry asks about 996 culture and regulatory changes under Trump. Paul explains that high equity ownership creates organic dedication without mandatory hours and highlights negative public sentiment from crypto scam coins. | |
| The Power of Perpetual Contracts (Perps) on Secondary Assets | 4 | 6 | 1 | 1 | Paul explains how perpetual contracts bypass the need for Special Purpose Vehicles (SPVs) when trading pre-IPO shares like SpaceX or Anthropic. Harry notes the concept, and the episode wraps up warmly. |
Statements from this episode (47)
FOMO Gave Non-Founder Early Employees Founder-Level Equity Packages
“We gave non-founders a percentage of the company that usually founders get.”
FOMO Team Took No Salary for First Eight Months of Building
“For the first eight months to building, no one on our team took any pay.”
FOMO to Launch Global Access to Equities and Perpetuals
“But we're soon gonna launch globally access to equities and perpetuals non-US obviously.”
FOMO's 140-Person Angel Round Was Core to Early Success
“I think that initial round was really core to the success of FOMO.”
Crypto Users' Passion Gives FOMO a Major Competitive Advantage
“And this is actually one of the biggest, largest competitive advantages for our company is in the on-chain and crypto industry specifically, the users are very passionate about using the products.”
Unpaid Early Access from Power Users Doubled FOMO Web App Quality
“And when we put out our web app, for example, we did it a week prior and we gave early access. The web app probably became twice as good just in that week. Because we were able to get early feedback from people who are actually passionate. And these people are…”
Financial Super Apps Lack Intentionality Behind Product Bundling
“Whereas all these other apps are just everything super apps, and there's no intentionality behind why all those things have to exist in the same place.”
FOMO Would Build Prediction Markets on Polymarket or Kalshi
“We haven't integrated prediction markets yet, and I'm not sure exactly where it fits in on our roadmap. I think it's very interesting there. I think our first version of the product would be built on something like a poly market in Calci.”
Hyperliquid Pre-IPO Perpetual Prices Converged to Cerebras IPO Valuation
“So what we saw with Cerebris is when the IPO happened, the hyper liquid price started to converge to that price at IPO, right?”
Retail Investors Gain Earlier Access to Private Markets via Perpetuals
“With pre-IPO, with prediction markets, retail gets access to these markets earlier and earlier.”
Robinhood's Horizontal Scaling Blocked Global Expansion
“They grew their business and they were able to saturate the U S market. But they weren't able to go global.”
Describing Retail Market Speculation as a Casino Is Derogatory
“I think casino is kind of a derogatory way to view it. I think somewhat, it's somewhat empowering, right?”
Founders Dilute Messaging Out of Launch Fear, Creating Mediocre Products
“One of the biggest mistakes I think I see with founders is like they're terrified of launching and not having any adoption. And so they make it a more diluted and diluted message for more and more people. It doesn't mean anything to anyone. And then they launc…”
FOMO's Series B Was 100% Inbound, Unlike Its Series A
“So for the series B, that was all inbound, but the series A, we actually did run a process because we were like, we should raise money here.”
Peter Fenton Used FOMO's App Throughout Benchmark's Pitch Meeting
“I remember Peter Fenton was actually on his phone most of it. And I was like, kind of bummed out because I was like, damn, he's not interested. He's focusing on other things. He's doing emails. And I remember as soon as we finished the pitch, the first thing h…”
Benchmark Did Not Offer the Highest Series A Valuation
“I think it was close, but not exactly the highest.”
FOMO Operates With No Meetings, One-on-Ones, or Hierarchy
“So currently FOMO is extremely horizontal. We don't have meetings, one-on-ones. We don't really have any hierarchy. Everyone is kind of self-reporting.”
FOMO Built Its Web App in One Month
“We built this product in three weeks, and this product is basically what entire other apps, their entire product is. You know, we built our web app in one month.”
FOMO Mandates Enterprise AI Tools to Safeguard Proprietary Code
“Yeah, so we have an internal AI policy to make sure that we're only using enterprise account, that there's not sensitive things being uploaded, etc. I think that's really important. And then within those guidelines, most of our engineers are using cloud code a…”
Salesforce's $300M Anthropic Spend Equals 3.8% of Developer Salaries
“Right now, you know, if you look at Mark Benioff, he said they spent three hundred million on Anthropik. That's about 3.8% of developer salaries spent on tokens.”
Spending 20% of Developer Salaries on AI Tokens Is Realistic
“But, yeah, so hopefully they get cheaper with time, energy gets cheaper, compute gets cheaper, and then these things get cheaper, but at the current state, absolutely. I think 20% is definitely within reason.”
Adding LLMs to Existing Design Tools Will Beat AI-Native Platforms
“So with Lovable, it's much harder because they haven't built the human centric software. I think it's much easier to add the LLM on top, especially as it becomes commoditized by all these major models.”
FOMO Will Focus on Native Creators Over Mainstream Celebrities
“So I'm not trying to get LeBron James to trade on FOMO. I want these native creators.”
BeReal Lost Momentum by Forcing Daily Activity Without Feedback Loops
“Be Real didn't have the feedback loop. It required people to do something every day, and people don't want to have to do something every single day, and I think as soon as you lose that, you lose momentum very quickly.”
Trader Turned $10K Into $2.5M Overnight on FOMO
“This guy, Iceman, who turned, he turned 10 K to two and a half million dollars overnight in one night on FOMO.”
Trader Turned $300 Into $1.5M in One Month on FOMO
“There's another guy, Remus, he turned, I think it was 300 dollars into one and a half million in a month.”
FOMO Manages 30 to 40 Content Creators Fully In-House
“So we actually have this all in-house. We have these creator managers, they're fully in-house, and we manage a group of 30 to 40 creators.”
Podcast Brand Sponsorships Should Always Be Permanent Placements
“The thing I say actually on brand marketing is look for immortal assets, and what I mean by immortal assets is like, if you sponsor a podcast, make sure that the podcast has it in perpetuity.”
Revolut CEO Regrets Not Investing in Brand Marketing Earlier
“Every single big founder I've had, Nick at Revolut included, said the single biggest mistake he made around marketing was he did not appreciate brand marketing enough early enough.”
Robinhood's Early iOS Deposit Edge Was Caused by Android Bug
“One of the early stories from Robinhood I love is that the deposit amounts from people with iOS were twice the ones from people with Android. And their assumption was just, oh, like people with iPhone just have more money. So they're depositing more money. And…”
Fred Wilson Has Rare Product Intuition for a VC
“He has a talk about VCs not being focused on the product, but Fred actually has a really good product intuition. I think it's very rare for VC”
Benchmark Lacks the Platform Resources of Multistage Funds
“I think Benchmark doesn't really have as many resources. Like these multistage funds have so many resources for founders.”
FOMO Holds More Cash in Bank Than Total Capital Raised
“Our team is scaling. I mean, we're making money. We have much more money in the bank than we ever raised.”
FOMO Plans to Verticalize All Infrastructure In-House
“Our plan is to kind of verticalize all of our infrastructure and own as much of it as we can in house.”
Revolut Will Outvalue Robinhood in Its Next Funding Round
“It's our fintech provider, Revolut, which has stolen the show, and I think on the next round will be considerably more valuable than Robinhood.”
Social Features in Finance Apps Require Momentum-Driven Design
“But you need to be very intentional about the social graph. And I think that's something that is very momentum based. And as soon as you start losing momentum there, people stop using the app and then the whole thing could kind of unravel.”
Revolut Is Strategically Better Positioned Long-Term Than Robinhood
“I, I'm a Robin Hood user because I'm in the US, so I'm going to say Robin Hood, but I do think Revolut is very well positioned. Honestly, it's really hard. Maybe Revolut. It's a close, it's a, that's a close one.”
Overreliance on AI for Writing Degrades Core Skill and Judgment
“I try to use AI for as little of my writing as possible, because I think if I use AI for all my writing, I'm not gonna be able to write anymore, and I'm not gonna be able to remember what is good writing. I'm pretty scared of that to be honest.”
FOMO Wants Ribbit Capital on Cap Table After Prior Discussions
“Ribbit Capital. We spoke with them, yeah. I really like Mickey and the team. They're great.”
FOMO Does Not Enforce 996 or Set Mandated Working Hours
“I think at FOMO, there's no, we don't put numbers to it. There's no nine, nine, six.”
Public Crypto Sentiment Dropped Significantly Despite Regulatory Progress
“I think there's been a lot of positive movement on regulatory clarity but at the same time, I think that sentiment for crypto has also gone down significantly from the general public.”
Lack of Consumer Protection Against Scam Coins Destroyed Crypto Sentiment
“And I think what's given such a bad rep is there's no consumer protection here on a lot of these products. So people will buy it. It's so hard to do in the first place, but then they get over the leap of actually doing the thing and then they just lose all the…”