Robinhood Markets Inc., or simply Robinhood, is a U.S.-based financial services company headquartered in Menlo Park, California. The company offers the Robinhood smartphone mobile app, which allows individuals to invest in publicly traded companies and exchange-traded funds listed on U.S. stock exchanges without paying a commission. The company makes money from interest earned on customers' cash balances and margin lending, and by selling order flow to high frequency trading firms.
Type of site
|Headquarters||Menlo Park, California|
|Key people||Vladimir Tenev (co-founder)|
Baiju Bhatt (co-founder)
|Industry||Finance and Insurance|
|Alexa rank||3,811 (January 2019[update])|
|Launched||April 18, 2013 in Palo Alto, California|
After an April 2017 fundraising, Robinhood had a $1.3 billion valuation. The Wall Street Journal reported in 2018 that the company had closed another round of financing that valued the company at $5.6 billion.
In December 2013 Robinhood launched out of stealth on the crowdsourced technology news website Hacker News, leading to articles about the company in TechCrunch, PandoDaily, VentureBeat, TheStreet and others. Initially the firm had a waiting list, and in under 30 days there were 100,000 signups.[self-published source?] In mid-to-late February 2014, co-founders Baiju Bhatt and Vladimir Tenev were on CNBC and Bloomberg TV.
By September 2014, the waiting list had reached 500,000 people. In March 2015, the company announced those still on the waitlist could create accounts and any U.S. residents, 18 and older, could apply for an account.
As of January 2015, 80% of the firm's customers belonged to the demographic "millennials" (people between the ages 18 and 29) and the average customer age was 26. Fifty percent of users who have made a trade use the app daily and 90% come back to the app weekly.
As of February 2017, the company had executed over $30 billion in trades. In April 2017, Robinhood announced they raised $110 million at a $1.3 billion valuation led by Yuri Milner from DST Global, and Greenoaks Capital and Thrive Capital, the venture capital firm founded by Josh Kushner, the brother of Jared Kushner (a senior adviser and son-in-law to U.S. President Donald Trump).
In August 2017, the company began offering free stocks in exchange for referring new users.
On January 25, 2018, the company announced a waitlist for commission-free cryptocurrency trading. As of 9:00PM on January 25, 2018 the waitlist for enabling the feature grew to more than 1,250,000. The month, Robinhood began offering commission-free trading of Bitcoin and Ethereum to users in California, Massachusetts, Missouri, and Montana. In May 2018, Robinhood expanded its Crypto trading platform to Wisconsin and New Mexico.
By February 2018, Robinhood had 3 million user accounts, around the same number as the online broker E-Trade. By April 2018 Robinhood had raised a total of $176 million in venture capital funding, with the last valuation at around $6 billion, up from their previous evaluation of $1.3 billion.
In June 2018, it was reported that the company was in talks to obtain a US banking license, with a spokesperson from the company claiming they were in "constructive" talks with the U.S. OCC. In December Robinhood announced checking and savings accounts, with debit cards in partnership with Sutton Bank, to be available in early 2019. Robinhood initially claimed the accounts would be SIPC insured, which the SIPC denied. The products were rebranded as "cash management" the next day. In January 2019 the waitlist and sign up page were removed from the app.
The company has no storefront offices and does not provide research reports or analytical tools on its platform.
The firm is a FINRA-approved broker-dealer, registered with the U.S. Securities and Exchange Commission and is a member of the Securities Investor Protection Corporation-- SIPC)--(SIPC has not been approved as of 1-1-2019).
Bloomberg News reported in October 2018 that Robinhood receives almost half of its revenue from payment for order flow. The company later confirmed this on its corporate website when asked by CNBC.
- "robinhood.com Traffic Statistics". Alexa Internet. Retrieved 2 January 2019.
- Gannes, Liz (23 September 2014). "With $13 Million, Robinhood Aims to Share the Stock-Trade Wealth". Re/code. Re/code. Retrieved 26 September 2014.
- "Robinhood lures digital coin traders from Coinbase with a free service". Digital Trends. 2018-02-22. Retrieved 2018-05-17.
- Constine, Josh (December 18, 2013). "Robinhood App Will Offer Zero-Commission Stock Trades Thanks To $3M Seed From Index And A16Z". TechCrunch.
- MORRISSEY, JANET (February 18, 2017). "With No Frills and No Commissions, Robinhood App Takes On Big Brokerages". New York Times.
- Kane, Logan. "Robinhood Is Making Millions Selling Out Their Millennial Customers To High-Frequency Traders". Seeking Alpha. Retrieved 13 February 2019.
- "Robinhood's Stock Trading App Is Valued at $1.3 Billion". 26 April 2017. Retrieved 6 April 2018 – via www.bloomberg.com.
- Winkler, Rolfe; MacMillan, Douglas (15 March 2018). "Valuation for Robinhood, Maker of App That Offers Free Stock Trades, Tops $5 Billion". Retrieved 6 April 2018 – via www.wsj.com.
- Touryalai, Halah (26 February 2014). "Forget $10 Trades, Meet Robinhood: New Brokerage Targets Millennials With Little Cash". Forbes Magazine. Retrieved 26 September 2014.
- Carney, Michael (December 28, 2013). "Robinhood gets $3M to take from Wall St. and give to Main St. with its mobile-first, zero-commission brokerage". PandoDaily.com.
- Matherson, Nate (December 17, 2013). "Robinhood Opens Investing Doors to Wall Street's 'Hood". TheStreet.com.
- GRANT, REBECCA (December 28, 2013). "Robinhood's pitch to millennials: free stock trading". VentureBeat.com.
- "Robinhood on Twitter". Twitter.
- Navarro, Brian J. (February 27, 2014). "Robinhood, a new app, offers free stock trades". CNBC.
- Wohlsen, Marcus (23 September 2014). "New App Wants to Make Trading Stocks as Easy as Posting Selfies". Wired.
- Roberts, Daniel (12 March 2015). "Robinhood, an investing app, is luring stock-market newbies". Fortune Magazine.
- Huang, Daniel (January 6, 2015). "Young, Poor and Looking to Invest? Robinhood Is the App for That". Wall Street Journal.
- Constine, Josh (23 September 2014). "Robinhood Raises $13M To Democratize Stock Market With Zero-Commission Trading App". TechCrunch. AOL.
- "Robinhood stock-trading app confirms $110M raise at $1.3B valuation – TechCrunch". techcrunch.com. Retrieved 2018-04-06.
- Cheng, Evelyn (25 January 2018). "Stock trading app Robinhood to launch bitcoin, ethereum trading in five states". CNBC. Retrieved 25 January 2018.
- John Roberts, Jeff (25 January 2018). "Robinhood, the Investing App for Millennials, to Add Bitcoin and Other Cryptocurrencies". Fortune. Retrieved 25 January 2018.
- Perlstein, Sharone (2018-03-19). "Robinhood, the Microfinance giant bets on Bitcoin". Sharone Perlstein. Retrieved 2018-03-19.
- "Invest in Bitcoin & other cryptocurrencies, 24/7 & commission-free". Robinhood. 25 January 2018.
- "Robinhood Opens Cryptocurrency Trading". Bloomberg.com. 2018-02-22. Retrieved 2018-04-11.
- "Robinhood's Crypto Trading Platform Expands to Wisconsin and New Mexico | Finance Magnates". Finance Magnates | Financial and business news. 2018-05-07. Retrieved 2018-05-17.
- Chafkin, Max; Verhage, Julie (2018-02-08). "Brokerage App Robinhood Thinks Bitcoin Belongs in Your Retirement Plan". Bloomberg Businessweek. Retrieved 2018-02-09.
- "Robinhood in Talks With Regulators to Offer Bank Products". Bloomberg.com. Retrieved 2018-06-22.
- Robinhood launches no-fee checking/savings with Mastercard & the most ATMs. TechCrunch. 13 December 2018.
- Robinhood said to not be properly insured to offer checking & savings. TechCrunch. 14 December 2018.
- A Letter From Our Founders. 14 December 2018.
- Robinhood quietly stops users from signing up for cash accounts amid scrutiny from regulators. MarketWatch. 2 January 2019.
- WOHLSEN, MARCUS (11 December 2014). "Stock Trading for the Touch-ID Era Has Finally Arrived". Wired.
- Tweedie, Steven (24 April 2015). "Best new Apple Watch apps I should download first". Business Insider.
- "Robinhood stock trading comes to web with finance news for its 3M users – TechCrunch". techcrunch.com. Retrieved 2018-05-02.
- Constine, Josh. "Robinhood aims at IPO as the fintech startup seeks CFO". TechCrunch. Retrieved 11 January 2019.
- Rooney, Kate (September 6, 2018). "Robinhood is on the path to IPO and is searching for a CFO". CNBC. Retrieved 11 January 2019.
- Kauflin, Jeff (December 13, 2018). "In A Bold Asset Grab, Robinhood Offers 3% Interest On Checking And Savings Accounts". Forbes. Retrieved 11 January 2019.
- Verhage, Julie (December 14, 2018). "Investing App Robinhood Is Facing 'Serious Concerns' Over Its New Checking Account With 3% Interest". Time Money. Retrieved 11 January 2019.
- Foxman, Simone (October 16, 2018). "Robinhood Gets Almost Half Its Revenue in Controversial Bargain With High-Speed Traders". Bloomberg. Retrieved 18 January 2019.
- "CNBC: How Robinhood Makes Money". CNBC. January 16, 2019. Retrieved 18 January 2019.