by It is no secret that the COVID-19 pandemic helped accelerate retail trading activity on brokerage apps, setting a new era for investor engagement. According to the World Economic Forum, retail investors accounted for 52% of global assets under management in 2021, a figure that’s expected to grow to over 61% by 2030. Here’s another startling fact: as of January 2025, there are 5.24 billion users of social media, which is almost two-thirds of the world’s population.
These two trends—increasing volumes of retail trading and record-setting social media usage—are increasingly intersecting.
This convergence doesn’t just matter for investors—it has major implications for how companies communicate. That, in turn, creates interesting opportunities and challenges for PR professionals advising on investor relations. It means being sure that IR strategies and programs keep pace with a changing audience.
The rise of retail investors, empowered by social media platforms—aka “new media”—and accessible trading tools, has reshaped the financial landscape, forcing companies to reconsider their communication strategies. No longer limited to analysts and institutional investors, public companies now find themselves engaging directly with a new, powerful audience: the social media-empowered retail investor. That has put a premium businesses having to navigate the complexities of managing their public image and brand loyalty in an era of decentralized, highly vocal communities.
While publicly traded companies have long prioritized communication with analysts and shareholders, the advent of new media has opened up creative avenues for engaging retail investors. Executives are now appearing on podcasts and YouTube channels alongside popular “finfluencers,” participating in Reddit AMAs, trading banter in comment sections, and even inviting retail investors to ask questions during earnings calls.
Which begs the following questions: when does it make sense for publicly traded companies, especially small to mid-caps, to go the extra mile and directly engage with their retail base? Do these interactions influence stock volatility or long-term investor loyalty? And what risks do companies face when unfiltered executive commentary meets the unpredictable dynamics of opinion-infused social media?
The Growing Influence of Retail Investors
Retail investors have long been dismissed as ‘dumb money,’ assumed to be incapable of keeping up with Wall Street’s institutional giants. However, the GameStop short squeeze of January 2021 was a turning point, highlighting the power of self-directed investors and the power of coordinated online communities in shaping market movements, for better or worse.
The democratization of data has further empowered retail investors. The revolution in personal investing came with the creation of the first online trading platform developed by a company called TradePlus in 1982, which was later acquired by E*TRADE. This enabled investors to access real-time stock quotes and place orders without having to call a broker or rely on outdated information to make decisions. More and more platforms subsequently emerged, democratizing the ability for millions of people —not just the wealthy with industry connections —to trade stocks.
The democratized access to financial technology has only accelerated over the years, as well as access to in-depth coverage and analysis. Anyone can now easily obtain company filings and disclosures, insider trading and ownership data, options data, operational insights, and a never-ending flow of company news. Additionally, a 2023 FINRA survey signals a generational divide in how financial information is sourced: 48% of retail investors aged 18-34 turn to social media to learn about investing, compared to just 18% of older investors.
This shift highlights the growing trust in online communities and influencers as sources of financial insight. However, retail communities don’t always promote the most responsible investing practices. The Wall Street Bets (WSB) subreddit, home to over 18 million self-described “degenerates” (members), is known for compiling highly leveraged options plays. Such communities may tempt novice traders to take only risky bets in the hopes of receiving eye-watering returns. The tragic case of 20-year-old Alexander Kearns, who took his own life after mistakenly believing he owed $730,165 due to a misinterpretation of his Robinhood account balance, serves as a stark reminder of the risks.
Despite the various pros and cons, online investment communities yield significant influence. Just as Wall Street sell-side analysts build their reputations by making accurate estimates for earnings and stock price, content creators increase their credibility by making the right picks, while defending themselves from the internet’s crude brand of accountability.
Platforms like X, Reddit, Substack, and YouTube foster vibrant, topic-based communities whereby individual investors share ideas, analyze stocks, coordinate strategies, and collectively shape market sentiment. Users post content—due diligence, analyses, memes, and hot takes—and the community votes to surface the best takes.
Crowd-sourced due diligence adds another layer, allowing investors to share niche expertise and collaboratively refine investment theses. The stereotype of retail investors as suckers for high-risk penny stocks—immortalized in films like The Wolf of Wall Street—doesn’t tell the whole story. “FinTwit,” short for “Financial Twitter,” is a diverse community that includes both regular retail investors and finance professionals, such as equity research analysts, professional traders, and data scientists.
Due to the virality of social media, the most upvoted posts can reach up to hundreds of thousands of impressions, sparking debate, fact-checking, and engagement in real-time. It’s chaotic, social, and potent. And publicly traded companies are taking notice.
Why Public Companies Are Engaging Retail Investors
With these trends in mind, the market is bearing witness to more public companies embracing online retail investing communities, prompting an evolution in public relations strategies. When done the right way, fostering direct engagement with retail investors can strengthen brand loyalty, enhance market confidence, and even drive long-term shareholder value.
On the PR/IR front, crafting press releases for journalists and expecting the sell-side to reach the coverage no longer suffices. Marketing communications and PR professionals have to contend with a decentralized and unpredictable crowd that can both amplify or undermine a company’s narrative in hours. And while media gatekeepers still matter, social media has accelerated how quickly the perception of companies can shift, with retail investors often setting the tone—particularly during times of crisis.
Real-World Examples
For example, in May 2022, crypto exchange Coinbase faced intense scrutiny on social media after its 10-Q filing indicated that, in the event of bankruptcy, customer assets might be treated as unsecured creditors. This was during the 2022 crypto winter, which saw the collapse of crypto exchanges like Celsius, Three Arrows Capital, and FTX.
In an eight-part series of tweets, Coinbase CEO Brian Armstrong addressed the issue directly to users and investors on Twitter to emphasize that the company had no risk of bankruptcy and was complying with a new SEC requirement. Those tweets seem to have instilled trust. The day Armstrong communicated via Twitter, Coinbase was trading at $70 a share; the stock is now trading at $188 a share, delivering a 168% increase while solidifying the company as a clear leader in the crypto industry.
Other companies, like Palantir, are deeply engaged with their retail investor base. The controversial U.S. defense contractor, led by its eccentric CEO, Alex Karp, has a cult-like retail following and is approaching 100,000 members on its dedicated subreddit. Plenty of investors have reported life-altering gains and continue to embrace Palantir for its outsider status and unorthodox management style.
Since listing as a direct public offering (DPO)—which cuts out the need for underwriters, like investment banks— Palantir’s market cap has increased tenfold, carrying thousands of retail investors along for the ride. During the company’s latest Q4 earnings on February 3rd, 2025— always released as a livestream video— Karp, when asked if he had anything to say to retail investors, gleefully exclaimed, “We’re doing it! We’re doing it. And I’m sure you’re enjoying this as much as I am.”
Telehealth company Hims & Hers has also recognized the power of retail engagement. It is another example of a company recently dubbed as a “meme stock”—a stock that gains popularity among retail investors through social media, as evidenced by its highly volatile price movements. A day before its earnings call, Hims & Hers took to X (Twitter) to solicit questions from its eager retail community, promising to answer two of them during the call.
During earnings calls, public companies traditionally stick to a strict format where only Wall Street analysts and institutional investors ask questions. Breaking from this norm, Robinhood, aligned with its mission to “democratize finance for all,” opened its latest earnings call to questions from prominent “finfluencers.” Among them was Amit Investing, a YouTuber with 65,000 subscribers who livestreams daily market coverage and frequently analyzes news and performance of companies popular with retail investors.
While publicly traded companies may feel more compelled to build goodwill with retail investors, they also have to be careful about what kind of information they are legally able to disclose. For example, Regulation Fair Disclosure was implemented by the Securities and Exchange Commission to prohibit companies from selectively disclosing material, non-public information to certain individuals before making it public to all investors.
Furthermore, social media also has the capacity to amplify brand damage when used recklessly. We’re seeing that right now with Tesla. Elon Musk, who infamously dissolved his PR team in favor of directly communicating with his 220 million followers, is currently facing a major PR crisis, as his alignment with the Trump administration and support of far-right political parties have contributed to a dramatic month-over-month decline in automobile sales in Europe and Canada, as well as an unprecedented amount of Tesla owners trading in their vehicles. Tesla has become a political symbol—a “no-no” on Wall Street —and controversy surrounding the company is intensifying on social media with hashtags like #teslatakedown and #swastikars. The company stock has now given up its gains since the election.
While a large portion of Tesla’s retail investor base may perhaps be in favor of Musk’s political stances and unabashed nature, the ongoing saga highlights the risk of using social media in a way that may inadvertently alienate a large customer base and thus affect the organization’s long-term potential.
The Bottom Line
Retail investors aren’t just spectators in the market—they are active participants who are able to influence stock prices, shape public narratives, and attract institutional interest. According to the Federal Reserve’s Survey of Consumer Finances, the percentage of households with stock holdings increased to an all-time high of 58% as of 2022, up from 49% in 2013.
And recent data published by The Financial Times on March 25th, 2025, states that individual investors have pumped almost $70 billion into US equities this year even as money managers are cutting their exposure to the market due to the Trump Administration’s economic policies —underscoring the conviction and influence of everyday investors in spite of economic and political instability.
Companies that acknowledge this shift and proactively engage with retail investors while taking advantage of new media can foster stronger brand loyalty, gain greater media visibility, and cultivate a more diverse shareholder base.
To be clear, a company’s fundamentals will always be the most important factor, and a big part of management’s responsibility is to ignore the noise. However, in today’s financial and media landscape, overlooking retail investors is not only a blind spot—it can be a lost opportunity.