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Robinhood (company)

Robinhood Markets Inc., or simply Robinhood, is a U.S.-based financial services company headquartered in Menlo Park, California.[2][3] 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.[4] The company makes money from interest earned on customers' cash balances and margin lending.[5]

Robinhood Markets Inc.
Robinhood Logo
HeadquartersMenlo Park, California
Key peopleVladimir Tenev (co-founder)
Baiju Bhatt (co-founder)
IndustryFinance and Insurance
ServicesBrokerage firm
Websitewww.robinhood.com
Alexa rankIncrease 5,128 (August 2018)[1]
LaunchedApril 18, 2013 in Palo Alto, California

After an April 2017 fundraising, Robinhood had a $1.3 billion valuation.[6] The Wall Street Journal reported in 2018 that the company had closed another round of financing that valued the company at $5.6 billion.[7]

Contents

HistoryEdit

The firm was founded by Vladimir Tenev and Baiju Bhatt who had previously built high-frequency trading platforms for financial institutions in New York City.[8][9]

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.[4][9][10][11] Initially the firm had a waiting list, and in under 30 days there were 100,000 signups.[12][self-published source?] In mid-to-late February 2014, co-founders Baiju Bhatt and Vladimir Tenev were on CNBC and Bloomberg TV.[13]

By September 2014, the waiting list had reached 500,000 people.[14] 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.[15]

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.[16] Fifty percent of users who have made a trade use the app daily and 90% come back to the app weekly.[17]

As of February 2017, the company had executed over $30 billion in trades.[5] In April 2017, Robinhood announced they raised $110 million at a $1.3 billion valuation led by Yuri Milner from DST Global[6], 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. [18]

In Augst 2017, the company began offering free stocks in exchange for referring new users.[19]

On January 25, 2018, the company announced a waitlist for commission-free cryptocurrency trading.[20][21][22] As of 9:00PM on January 25, 2018 the waitlist for enabling the feature grew to more than 1,250,000.[23] The month, Robinhood began offering commission-free trading of Bitcoin and Ethereum to users in California, Massachusetts, Missouri, and Montana.[24] In May 2018, Robinhood expanded its Crypto trading platform to Wisconsin and New Mexico.[25]

By February 2018, Robinhood had 3 million user accounts, around the same number as the online broker E-Trade.[26] 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.[27]

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.[28] In December Robinhood introduced checking and savings accounts with partner Sutton Bank, to be available in early 2019.[29] Robinhood initially claimed the accounts would be SIPC insured, which the SIPC denied.[30]

OperationsEdit

Robinhood operates a website and mobile apps for iPhone,[31] Apple Watch,[32] and Android.[33]

The company has no storefront offices and does not provide research reports or analytical tools on its platform.[5]

The firm is a FINRA-approved broker-dealer,[2] registered with the U.S. Securities and Exchange Commission and is a member of the Securities Investor Protection Corporation (SIPC).[8]

See alsoEdit

ReferencesEdit

  1. ^ "robinhood.com Traffic Statistics". Alexa Internet. Retrieved 15 August 2018.
  2. ^ a b Gannes, Liz (23 September 2014). "With $13 Million, Robinhood Aims to Share the Stock-Trade Wealth". Re/code. Re/code. Retrieved 26 September 2014.
  3. ^ "Robinhood lures digital coin traders from Coinbase with a free service". Digital Trends. 2018-02-22. Retrieved 2018-05-17.
  4. ^ a b Constine, Josh (December 18, 2013). "Robinhood App Will Offer Zero-Commission Stock Trades Thanks To $3M Seed From Index And A16Z". TechCrunch.
  5. ^ a b c MORRISSEY, JANET (February 18, 2017). "With No Frills and No Commissions, Robinhood App Takes On Big Brokerages". New York Times.
  6. ^ a b "Robinhood's Stock Trading App Is Valued at $1.3 Billion". 26 April 2017. Retrieved 6 April 2018 – via www.bloomberg.com.
  7. ^ 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.
  8. ^ a b Touryalai, Halah (26 February 2014). "Forget $10 Trades, Meet Robinhood: New Brokerage Targets Millennials With Little Cash". Forbes Magazine. Retrieved 26 September 2014.
  9. ^ a b 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.
  10. ^ Matherson, Nate (December 17, 2013). "Robinhood Opens Investing Doors to Wall Street's 'Hood". TheStreet.com.
  11. ^ GRANT, REBECCA (December 28, 2013). "Robinhood's pitch to millennials: free stock trading". VentureBeat.com.
  12. ^ "Robinhood on Twitter". Twitter.
  13. ^ Navarro, Brian J. (February 27, 2014). "Robinhood, a new app, offers free stock trades". CNBC.
  14. ^ Wohlsen, Marcus (23 September 2014). "New App Wants to Make Trading Stocks as Easy as Posting Selfies". Wired.
  15. ^ Daniel Roberts (12 March 2015). "Robinhood, an investing app, is luring stock-market newbies". Fortune Magazine.
  16. ^ Huang, Daniel (January 6, 2015). "Young, Poor and Looking to Invest? Robinhood Is the App for That". Wall Street Journal.
  17. ^ Constine, Josh (23 September 2014). "Robinhood Raises $13M To Democratize Stock Market With Zero-Commission Trading App". TechCrunch. AOL.
  18. ^ https://www.reuters.com/article/us-robinhood-investment/trading-startup-robinhood-raises-110-million-in-new-funding-round-idUSKBN17S1WV
  19. ^ "Robinhood stock-trading app confirms $110M raise at $1.3B valuation – TechCrunch". techcrunch.com. Retrieved 2018-04-06.
  20. ^ Cheng, Evelyn (25 January 2018). "Stock trading app Robinhood to launch bitcoin, ethereum trading in five states". CNBC. Retrieved 25 January 2018.
  21. ^ John Roberts, Jeff (25 January 2018). "Robinhood, the Investing App for Millennials, to Add Bitcoin and Other Cryptocurrencies". Fortune. Retrieved 25 January 2018.
  22. ^ Perlstein, Sharone (2018-03-19). "Robinhood, the Microfinance giant bets on Bitcoin". Sharone Perlstein. Retrieved 2018-03-19.
  23. ^ "Invest in Bitcoin & other cryptocurrencies, 24/7 & commission-free". Robinhood. 25 January 2018.
  24. ^ "Robinhood Opens Cryptocurrency Trading". Bloomberg.com. 2018-02-22. Retrieved 2018-04-11.
  25. ^ "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.
  26. ^ Chafkin, Max; Verhage, Julie (2018-02-08). "Brokerage App Robinhood Thinks Bitcoin Belongs in Your Retirement Plan". Bloomberg Businessweek. Retrieved 2018-02-09.
  27. ^ https://www.bloomberg.com/news/articles/2018-05-11/robinhood-founders-turn-billionaires-in-a-silicon-valley-minute
  28. ^ "Robinhood in Talks With Regulators to Offer Bank Products". Bloomberg.com. Retrieved 2018-06-22.
  29. ^ Robinhood launches no-fee checking/savings with Mastercard & the most ATMs. TechCrunch. 13 December 2018.
  30. ^ Robinhood said to not be properly insured to offer checking & savings. TechCrunch. 14 December 2018.
  31. ^ WOHLSEN, MARCUS (11 December 2014). "Stock Trading for the Touch-ID Era Has Finally Arrived". Wired.
  32. ^ Steven Tweedie (24 April 2015). "Best new Apple Watch apps I should download first". Business Insider.
  33. ^ "Robinhood stock trading comes to web with finance news for its 3M users – TechCrunch". techcrunch.com. Retrieved 2018-05-02.

External linksEdit