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Market Update

Robinhood: What to Know Before It Goes Public

A look at how the trading app makes money, its competition, and its growth potential.

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Robinhood has been no stranger to the spotlight since the launch of its trading platform in 2015. The company has been a disruptor in the fintech space: The discount brokerage’s mission to democratize investing, its streamlined platform, and zero minimums have made it popular among younger investors. Its no-commission model has forced competitors to follow suit.

Robinhood’s growth has been impressive, and the company has found no shortage of funding. One of Robinhood’s co-founders told members of Congress in February that the brokerage has more than 13 million users. JMP Securities estimated that Robinhood’s total accounts may actually be closer to 23 million. Through January 2021, the company has raised nearly $5.6 billion. After its last deal, Robinhood’s post valuation was $11.87 billion, according to PitchBook, a Morningstar company.

Margaret Giles does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.