US-based online trading platform developer Robinhood Markets floated yesterday in a $2.09bn initial public offering representing exits for internet and technology group Alphabet and entertainment agency Roc Nation.
The company priced 55 million shares at the foot of the IPO’s $38 to $42 range. It issued nearly 52.4 million on the Nasdaq Global Select Market while the remaining shares were divested by co-founders Vladimir Tenev and Baiju Bhatt and chief financial officer Jason Warnick.
Robinhood operates an online platform with 17.7 million monthly active users who can use its Robinhood Financial marketplace to trade stocks and shares, and its Robinhood Crypto to do the same with digital currencies. It made a $7.4m net profit in 2020 from $959m in revenue.
Alphabet subsidiary GV backed RobinHood’s $3m seed round in 2013 with Index Ventures, Greenoaks Capital, Rothenberg Ventures, Queensbridge Venture Partners, Social Leverage and Vaizra Investments.
Roc Nation invested an undisclosed amount in the company in February 2018, before which it had raised a total of $176m from investors also including DST Global, Andreessen Horowitz, Rothenberg Ventures, New Enterprise Associates (NEA), Ribbit Capital and Thrive Capital.
DST Global led RobinHood’s $363m series D round three months later at a $5.6bn valuation, investing with another Alphabet unit, CapitalG, as well as Iconiq Capital, Sequoia Capital, Kleiner Perkins Caufield and Byers and existing backers including Thrive Capital and NEA.
The company upped its valuation to $7.6bn in a $373m series E round closed in late 2019 and backed by DST Global, Ribbit Capital, NEA, Sequoia Capital and Thrive Capital.
Sequoia Capital, NEA, Ribbit Capital, 9Yards Capital, Unusual Ventures, TSG Consumer Partners and IVP added $600m in June 2020 series F round valuing RobinHood at $8.3bn.
D1 Capital Partners put up $460m for RobinHood’s $660m series G round, which closed in September with backing from Andreessen Horowitz, Sequoia Capital, DST Global, Ribbit Capital and 9Yards Capital at a post-money valuation of $11.7bn.
Ribbit Capital led a $3.4bn round for the company in February this year, investing together with existing backers including Iconiq Capital, Andreessen Horowitz, Sequoia Capital, Index Ventures and NEA.
Chief creative officer Benjamin Bhatt owns 59.8% of the company’s 132 million class B shares post-IPO while president and CEO Vladimir Tenev has 40.2%. Index Ventures retains 12.8% of its 701 million class A shares while NEA has 10.6%, Ribbit Capital 9% and DST Global 8.3%.
Goldman Sachs and JP Morgan are joint lead book-running managers for the offering while Barclays, Citigroup and Wells Fargo Securities are also book-running managers.
The underwriters have a 30-day option to acquire up to 5.5 million extra shares, potentially boosting the IPO to $2.3bn. Robinhood’s shares are trading at $33.95 at time of publication.
