This article originally ran in Term Sheet, Fortune’s newsletter about deals and dealmakers. Sign up here.
Robinhood, a no-fee trading stock trading startup, just made its first acquisition, and it’s a millennial-focused media company called MarketSnacks.
This purchase may seem odd for the fintech giant valued at more than $5 billion, but it makes sense given Robinhood’s increased push to become one-stop shop for a young investor’s needs.
“We improved market news coverage on our platform, added discovery tools on mobile, and revamped our Help Center to better answer your questions,” Josh Elman, Robinhood’s VP of product, writes in a blog post. “Robinhood Snacks is a major step towards building out these resources and helping you get more informed on market news.”
MarketSnacks, a daily podcast and newsletter, focuses solely on finance, featuring a funny photo and humorous analysis on three to four news items each morning. Now, the newsletter will re-brand to “Robinhood Snacks” and the podcast to “Snacks Daily” with exposure to the company’s existing user base of more than 6 million users as well as the general public. MarketSnacks co-founders Nick Martell and Jack Kramer will join Robinhood as managing editors of news and continue to produce the daily news offerings.
“Robinhood approached us and told us that their users were craving easily digestible and accessible business news,” Martell told Fortune. “Robinhood’s done an amazing job at breaking down barriers of financial services and financial products, but users still need good information to participate and be well-informed.”
Robinhood declined to disclose the terms of the deal and did not provide growth metrics for the newsletter. MarketSnacks had “tens of thousands of subscribers” two years ago when I last interviewed the founders.
Founded in 2012, MarketSnacks started as a creative outlet outside of the founders’ full-time jobs on Wall Street. After the markets closed, Martell and Kramer would text each other about what they’d include in the following morning’s newsletter. They then divvied up the sections of the newsletter and took turns editing it each day.
I first subscribed to MarketSnacks in 2014 when I was working at a startup in New York City. I was 22 years old, and my boss recommended a few financial newsletters that were easy to understand. I fit squarely into MarketSnacks’ target demographic as their average user is in their 20s, with 85% of their subscriber base under the age of 36. Roughly half of the newsletter readers are women. Robinhood has a somewhat complementary demographic with its average user being 32 years old and 50% of their customer base being first-time investors.
The newsletter strikes a light-hearted tone while tackling subjects like initial public offerings, acquisitions, and quarterly earnings. The goal is to translate financial news to anyone — even if they don’t work on Wall Street. For instance, rather than saying Chipotle missed on earnings, you’ll read something like, “Everyone has that friend who lamely chooses ‘burrito bowl’ over ‘burrito.’ The latest earnings from Chipotle were like that friend.”
“We make what can be dry and boring really fun and relatable,” Kramer said. “We believe humor is a great tool in making things memorable for people just getting into the financial world.”
Last year, Martell and Kramer quit their jobs to focus on their venture full time and raised funding of an undisclosed amount from Rough Draft Ventures. They also struck syndication deals with clients such as Fidelity Investments and made media appearances on financial news outlets. Robinhood approached the founders this summer and sponsored the newsletter, which ultimately led to an acquisition offer.
“A core element here is that ‘Robinhood Snacks’ will have editorial independence from the rest of Robinhood,” Martell said. “We are committed to a set of editorial principles, just like any committed news organization.”
I’ve written previously about the murky territory tech companies have to navigate when they wade into the business of content. Although Martell and Kramer insist that MarketSnacks will maintain editorial independence from Robinhood, when presented with the following scenario, those lines get blurry. I asked — if Robinhood goes public and the IPO doesn’t go so well, how will you present the event in the newsletter? “The inherent conflict of interest in that case is so strong, we’re not going to cover Robinhood at all, but we will cover everything else with editorial independence,” Kramer said.
But an important distinction is that Robinhood isn’t launching a publication. It sees the MarketSnacks acquisition as a value proposition to existing and future Robinhood customers. Subscribers to the newsletter don’t have to be a user of any Robinhood products.
The other interesting part of this deal is that Robinhood will also scoop up the MarketSnacks podcast, which offers a breakdown of the top three business stories of the day in 15 minutes. The news comes after Spotify bought podcasting startups Gimlet Media and Anchor for a combined $340 million.
“I think podcasting has a huge growth trajectory — the engagement is insane,” Martell said. “To us, this exit is a testament to the power of combining a tech company’s resources with the trust and value of a media platform.”