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Robinhood to File for Confidential IPO in March

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by Ibukun Ogundare · 3 min read
Robinhood to File for Confidential IPO in March
Photo: Depositphotos

It has been already revealed that that Robinhood selected Goldman Sachs Group Inc to lead its IPO.

Stock brokerage Robinhood Markets Inc is reportedly planning a confidential filing for an initial public offering (IPO) in March. Familiar sources confirmed the development on the 26th of February.

Citing reliable sources, Bloomberg revealed that Robinhood has been discussing with underwriters on the confidential IPO filing. According to Bloomberg, Bloomberg may achieve the filing in a few weeks. However, the sources added that Robinhood had not made final decisions about the intended IPO filing. Also, the sources added that the timing could change.

Robinhood IPO: Details

Before now, Coinspeaker had reported that Robinhood was in talks with Goldman Sachs Group Inc (NYSE: GS) regarding the trading platform’s IPO. The report said that Robinhood had selected Goldman Sachs Group Inc to lead the intended IPO. Also, the report revealed that the IPO could value Robinhood at over $20 billion.

This came after an earlier report by Bloomberg about Robinhood seeking advisers ahead of its 2021 IPO. According to the report, Robinhood had not made an official announcement about going public. Still, the IPO could happen in the first quarter of the year.

Robinhood secured major funding from several investors over the past months. Some of the investors are DST Global, 9Yards Capital, Sequoia Capital Ribbit Capital, and Andreessen Horowitz.

In May, Robinhood raised $280 million through cash investments, pushing its valuation to $8.3 billion. Shortly after, the company’s valuation increased to $8.6 million after another cash investment of $320 million. The trading platform raised an additional $200 million from D1 Capital Partners, pushing the trading company further to an $11.2 billion valuation.

Robinhood Records Growth in Customer Base amid Pandemic

Robinhood became more popular last year during the global lockdown. As there were restrictions in movement, young people indoors explored the trading app to pass the time and make money. The company confirmed its growth in a routine filing with the US Securities and Exchange Commission (SEC) on the 26th of February:

“Throughout the COVID-19 pandemic, we have seen substantial growth in our customer base, retention, engagement and trading activity metrics, as well as continued gains and periodic all-time highs achieved by the equity markets generally. As a result of the COVID-19 pandemic, market volatility, stay-at home orders and the distribution of government stimulus checks helped foster an environment that encouraged an unprecedented number of first-time retail investors to become our customers and begin trading on our platform.”

Robinhood also made several headlines in January during the market frenzy. During the time, a Reddit message board, WallStreetsBets triggered the market mania. The online brokerage halted the trading of selected stocks on its platform amid the unusual market rally.

In the recent filing, Robinhood also noted some of the investigations the company is facing due to the trading restrictions it imposed. Robinhood said the investigation targeting the company is from different agencies. Some include the SEC’S Division of Examinations, and FINRA, the New York Attorney General’s Office.

Business News, IPO News, Market News, News, Wall Street
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