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Robinhood's IPO likely to value trading app up to $35 billion

PUBLISHED ON 2021-07-19 21:30:00 EST Ishika Dangayach

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Robinhood Markets Inc is aiming for a valuation of up to $35 billion in its initial public offering in the United States, according to a filing on Monday.

The plans for a listing come only months after the online brokerage found itself at the core of a spat between a growing number of regular investors and Wall Street hedge funds in late January.

The business intends to sell about 52.4 million shares in the offering, with other investors selling approximately 2.6 million at a price ranging from $38 to $42 per share. Robinhood would raise around $2 billion at the midpoint of the offering range.

According to the filing, Salesforce Ventures, the investment arm of software company Salesforce.com Inc, is aiming to buy up to $150 million in Class A common stock at the IPO price.

Founded in 2013, Robinhood’s Chief Executive Vlad Tenev and Co-Founder Baiju Bhatt will own roughly two-thirds of the voting power in the firm. Each holds a unique class of shares that grants them ten times the voting rights of the common stock that Robinhood intends to offer in the IPO.

The company’s platform enables users to conduct limitless commission-free transactions in stocks, exchange-traded funds, options, and cryptocurrencies.

The business was chastised when it was forced to halt trading amid this year's rise in GameStop and other previously beaten-down companies, plans to post second-quarter revenue of $546 million to $574 million, which is more than double what it made the previous year.

Robinhood was obliged to seek $3.4 billion in emergency financing at the time as its finances were stretched by a large increase in retail trading and a corresponding increase in capital needs from clearing houses.

The IPO of Robinhood comes amid a record 15-month run for the U.S. IPO market, as investors rushed to purchase shares of high-growth technology companies.

The business intends to list on the Nasdaq under the ticker symbol "HOOD."

The offering's primary underwriters are Goldman Sachs and J.P.Morgan.

With inputs from Reuters


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