US-based online trading platform Robinhood is preparing an initial public offering that would provide exits to internet technology conglomerate Alphabet and music management agency Roc Nation, TechCrunch reported yesterday.
Baiju Bhatt, Robinhood’s CEO, revealed the company is undergoing internal and external audits from US regulators in preparation for an offering, and is also planning to hire a chief financial officer.
Robinhood has created a commission-free trading platform aimed at novice investors, allowing them to easily track, buy and sell stock, options, exchange-traded funds, American depositary shares and cryptocurrency.
The company also offers a premium subscription service, Robinhood Gold, with expanded trading options. It generates revenue through the interest in clients’ accounts, a premium subscription option and a fee on cryptocurrency trading.
Robinhood’s customer base has grown to 5 million and the company has raised $540m in funding to date. It was valued at $5.6bn as of a $363m series D round featuring CapitalG, Alphabet’s growth-stage investment unit, in March this year.
DST Global led the series D round, which included Iconiq Capital, Sequoia Capital, Kleiner Perkins Caufield and Byers, New Enterprise Associates and Thrive Capital. The deal included a $100m divestment by Robinhood’s co-founders and employees.
Roc Nation’s Arrive unit had invested in the company in February 2018, though it was not explicitly named as a participant in the series D round.
GV, another corporate venturing subsidiary of Alphabet, had backed the company’s $3m seed round in 2013 alongside Index Ventures, Andreessen Horowitz, Rothenberg Ventures and assorted angel investors.
Robinhood’s shareholders also include Greenoaks Capital, Ribbit Capital, Queensbridge Venture Partners, Social Leverage and Vaizra Investments.