Robinhood Might See a $8 Billion Valuation – Soon
Millennial-catered online broker Robinhood is negotiating to raise $350 million in new funding. Courtesy of Sequioa Capital, one of Silicon Valley’s biggest venture investors, might boost the company’s value to $8.0 billion.
Its most recent funding came from DST Global with a $323 million Series E round. Other venture capital firms, including Sequioa, contributed to this as well.
The deal, sealed in July 2019, put its valuation up to $7.6 billion, $2 million higher than 2018’s Series D.
Robinhood, now in its sixth year, grew rapidly since its first launch to more than 10 million in 2019. Now, it’s earning twice as many accounts as it did exactly a year ago.
The firm is still widely known as the broker firm that permanently changed modern trading as we know it. As soon as its company launched in 2012, it offered no-fee trading, attracting millions of millennials into the platform.
In the span of a few weeks, much larger financial firms followed soon after. Charles Schwab Corp is one of the biggest companies that eliminated commission fees for trading across several asset classes.
Robinhood vs E-Trade
Like every success story, Robinhood is not immune to unforeseeable problems. Plenty of its users don’t know how much they’ve fared during one of the biggest market days of the year.
Last month, clients complained about not having access to their accounts, as well as long waits for customer service. It’s a sign that the company managed to earn more members than it has staff to help everyone.
This is opposed to one of its rivals, E-Trade, which had less than half the number of members last December. More specifically, the online firm saw 4.9 million brokerage accounts by the end of 2019.
When comparing how both brokers grew these past few years, E-Trade saw an annualized new growth rate of 7 percent.
Get the latest economy news, trading news, and Forex news on Finance Brokerage. Check out our comprehensive trading education and list of best Forex brokers list here. Subscribe now and receive FREE updates on the market today!