Robinhood Attracts $200 Million as Valuation Swells to $7 Billion: Report


Robinhood Attracts $200 Million as Valuation Swells to $7 Billion: Report

robinhood

Robinhood is close to securing its latest funding round in which the mobile trading app will be valued at $7 billion and possibly even $10 billion. | Source: Shutterstock

ByCCN: Who says millennials don’t like to save and invest their money? By building a commission-free stock brokerage and trading app with a slick interface,Robinhoodhas built a $7 billion business in just six years. That’s the company’s valuation as it nears a $200 million funding round from its current financial backers,Bloomberg reports. The investment round is still unfolding and once complete could reportedly result in Robinhood fetching a valuation as high as $10 billion.

Robinhood closed its most recent funding round last year at which time a $5.6 billion valuation was attached.

The stock trading app boasts a stellar track record of growing its user base and monetizing its services.

According toNasdaq, Robinhood Markets Inc. made $8 billion in revenue in 2017 and is projected to rake in $47 billion annually by 2020. It is already the fastest growing broker of all time.

Last year the investment appblew passedE*Trade after doubling its user base to 4 million.E*Trade, which was started in 1982, had 3.7 million user accounts at the time.

Start spreading the news, Robinhood Crypto is officially in New York now. Trade Bitcoin, Ethereum, and other crypto in New York State.https://t.co/HGyvW8NUk9pic.twitter.com/K2XfXZukXO

— Robinhood (@RobinhoodApp)May 23, 2019

How Does Robinhood Makes Its Money?

With no commission fees, a common question people have when they first hear about Robinhood is: ‘How does the app make money?’ It’s a fair question.

Robinhood’s profitscome fromthree sources:

  • Interest earned by lending money held in Robinhood accounts
  • Selling orders to high-volume exchanges seeking more liquidity
  • Robinhood Gold subscriptions that charge users $10 to $200 a month to borrow anywhere from $2,000 to $50,000 to trade on margin

The sale of orders to high-frequency exchanges is a practice thathas attractedsome criticism for a lack of transparency.

Congrats to Menlo-Park based@RobinhoodAppfor being recognized on the 2019 CNBC#Disruptor50list for their 3rd consecutive year.#RewriteTomorrowpic.twitter.com/XvupsBqiOP

— Nasdaq (@Nasdaq)May 23, 2019

Robinhood’s Merry Band of Millennials

Robinhood is very popular with millennials. The lack of commission fees is a big selling point for millennials, who have less cash to spare than their parents did when they were that age. The app’s friendly interface and slick design is also likely a draw for the young-ish crowd.

Millennials Also Love Cryptocurrency

There’s no doubt that the mobile app’s selection of cryptocurrency investments is also attractive to millennial savers and daytraders.

One nationwidesurvey found43% of millennials trust crypto exchanges more than stock exchanges. A further 90% ofmillennials prefer cryptocurrencyto gold.

Robinhood Co-Founder and co-CEO Baiju Bhatttold CNBClast year:

“Crypto has certainly added to our growth. In the next couple of years I think you’ll see Robinhood looking like a full-service consumer finance company.”

About The Author

Wes Messamore

Grew up reading Isaac Asimov, J.R.R. Tolkien, The Bible, Ayn Rand, John Locke, and Robert Heinlein while listening to conservative talk radio, reading used economics textbooks, and reading through most mainstream political newspapers and magazines.

This article was edited byGerelyn Terzo.

Read More

Related posts:

‘I’ve had a helluva ride in life’: Ron Joyce, Tim Hortons co-founder, dead at 88
Via https://newsapi.org online business online marketing online business opportunities Government...
business opportunity in the post-Hayne world" style=" background: transparent url(https://onlinebizopps.info/wp-content/uploads/2019/01/265/directorships-a-risky-a-hrefhttpslcptrwv-netlcpmercedescol1twsuccessteam57247-target-blankbusiness-opportunitya-in-the-post-hayne-world-150x150.jpg) no-repeat scroll 0% 0%; width: 150px; height: 150px; ">
Directorships a risky business in the post-Hayne world
These businesses are offering military discounts for Veterans Day 2019 - East Idaho News
Via https://newsapi.org online business online marketing online business opportunities What is a ...
The explosive growth of quant investing is paving the way for 'super managers' in the hedge fund ind...

Be the first to comment on "Robinhood Attracts $200 Million as Valuation Swells to $7 Billion: Report"

Leave a comment

Your email address will not be published.


*