Robinhood’s IPO: A New Chapter for Millennial Traders
So, you’ve heard about Robinhood soaring into the public spotlight, right? On July 28 they raked in US$2.1 billion by selling 55 million shares at the lower end of their $38‑$42 price band. With that haul, they’re now valued at a whopping US$31.8 billion—making them one of the hottest U.S. names to go public this year.
Why the hype is so high
- Currency craze: $1 $2 keeps the user base buzzing.
- GameStop & AMC: meme stocks that shook the market, fueled by Reddit chatter.
- Active users jumped from 11.7 M at the end of 2022 to 21.3 M by June‑2023.
In a tongue‑in‑cheek twist, Robinhood promised to set aside 20–35% of its IPO for the very users that first made it a buzz‑worthy app. One would hope they’re calling their trading badges “golden tickets” now.
What a platform buys you
Think of it as a “no‑commission‑nay” playground for:
- Stocks & ETFs
- Options
- Cryptocurrencies
It’s that kid‑friendly interface that got everyone from college slouches to stay‑at‑home traders humming along during the pandemic.
Past bumps on the road
Robinhood’s quick rise wasn’t all smooth sailing:
- Widespread anger from traders and lawmakers when the platform slapped a ten‑fold rise in deposit rules.
- Regulators sniffing around for internal trades in popular meme stocks.
- In June, they shelled out almost US$70 million to settle an FINRA investigation over system failures and “false or misleading” claims.
Payment for order flow controversy
Because Robinhood doesn’t charge you per trade, they instead pocket fees from market‑makers who want to receive your order. Critics say the model might nudge the platform toward the cheapest trade rather than the most suitable one for you. The SEC is keeping a close eye on this.
Founders stay in the driver’s seat
Founded by Stanford roommates Vlad Tenev & Baiju Bhatt in 2013:
- Bhatt now controls about 39% of voting power.
- Tenev holds roughly 26.2%.
And get this—Robinhood’s shares will start trading on NASDAQ under the ticker “HOOD” on Thursday. All the money is up for grabs; just remember to DO YOUR RESEARCH and keep your trade jitters at bay.
