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Robinhood Files Confidential Paperwork With SEC for an IPO

Robinhood Files Confidential Paperwork With SEC for an IPO
  • Robinhood has filed confidential paperwork with the SEC for an initial public offering.
  • The company added 3 million users through a Reddit-fueled trading frenzy in January.

Robinhood has filed confidential paperwork with the Securities and Exchange Commission (SEC) for an initial public offering (IPO). The company affirmed their decision via a blog post.

The company got off to a wild start to the year. During the Gamestop stock incident, it gained a large number of users onto its stock trading app. Robinhood added 3 million users through a Reddit-fueled trading frenzy in January, JMP Securities estimated.

That boom put Robinhood in hot water as it chose to limit trading on GameStop. Users could no longer trade highly-shorted stock. Users could no longer trade highly-shorted stock. Government bodies and renowned tech titans both highly criticized Robinhood’s CEO, Vlad Tenev, for this decision. Tenev pondered over possibly making new regulations.

Robinhood was established in 2013 by Tenev and Baiju Bhatt. They were first working in finance, selling and trading software to hedge funds, until finally, creating Robinhood. They hoped to help improve opportunities to everyday retail investors. Particularly by buying and selling stocks without commissions.

Before the GameStop controversy earlier this year, Robinhood had a value of approximately $12 billion in a 2020 financing round. Also, to avoid a liquidity crunch, the company raised $3.4 billion in February.

Additionally, interest in the public markets for all things tech has led to an increase in active investors. Robinhood counts New York-based D1 Partners, Sequoia, Kleiner Perkins, and Google-parent Alphabet’s venture capital arm, GV, among its most prominent venture capital investors.

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A Computer Engineering graduate who writes news focuses on cryptocurrency-related and blockchain technology. He is enjoying using his skills to contribute to informing people of the exciting technological advances that happen every day.