On Thursday, the trading platform Robinhood debuted on Nasdaq under the ticker HOOD and fetched over 2 billion dollars. The company is valued at 32 billion dollars, equivalent to about 280 billion kroner, with a listing price of 38 dollars per share, according to CNBC.
Robinhood’s vision is to lower the threshold for entering the financial world and the company offers, among other things, brokerage – free purchase and sale of shares.
Untraditional listing
In line with their vision, Robinhood goes public in an untraditional way and invites its own small savings clients to participate in the listing.
The stock trading platform Robinhood offers 20-35 percent of the shares to its own clients on the company’s own mobile application, which differs from traditional listings, writes CNBC.
Listings have traditionally been reserved for institutional investors or wealthy individual investors. Small shareholders typically do not have the opportunity to buy into the companies before the shares are traded on the stock exchange.
Revolutionized stock trading
Robinhood revolutionized stock trading by offering users to sell and buy shares for free. This meant that the rest of the industry had to throw in the towel and give up such payments in 2019.
The trading platform has become very popular among small shareholders who want to buy and sell shares for the first time. The strong growth of small shareholders has been a good help for Robinhood, which has experienced explosive growth recently.
During the first quarter, the number of users increased from 18 million customers to 22.5 million. At the end of the second quarter, the app had over 22.5 million users. Revenue more than quadrupled in the first quarter of 2021 compared to the same period last year, jumping from $ 128 million to $ 522 million.
Option trading accounts for approximately 38 per cent of turnover, while shares and crypto are 25 and 17 per cent of revenues, respectively. However, Robinhood has warned that the brokerage business may have a drop in revenue and that the growth in the number of offices will decrease as the boom in the number of small shareholders will decrease, writes CNBC.
Competitors to Robinhood include Fidelity, Charles Schwab, Interactive Brokers and newer services such as Webull and SoFi. Charles Schwab has a market value of $ 130 billion and Interactive Brokers has a market value of $ 26 billion, according to CNBC.
DST Global, Index Ventures, NEA and Ribbit Capital are among Robinhood’s largest investors.
– .
