Robinhood IPO: Filing Confidentially to Go Public

Robinhood Files for Private IPO

According to reports from Bloomberg and confirmed by Axios, Robinhood has submitted a private filing to initiate the process of becoming a publicly traded company.

Robinhood is a well-funded American fintech company renowned for offering consumers trading services without commission fees.

Recent Trends in IPO Filings

Submitting an IPO filing privately has become increasingly prevalent in recent financial quarters. Therefore, Robinhood’s decision to file confidentially before disclosing its financial performance to the public isn't unexpected.

However, this private filing suggests the company is progressing towards a public offering sooner than previously estimated.

Anticipated 2021 IPO

For some time, market observers have anticipated that Robinhood would pursue an IPO in 2021. TechCrunch has reached out to Robinhood for comment regarding the private filing, but has not yet received a response.

Reasons for a Near-Term Public Debut

Despite facing controversies in recent periods, several factors may be driving Robinhood’s interest in a public debut. The current stock market strongly favors companies demonstrating substantial growth, a characteristic Robinhood possesses.

Furthermore, recent IPOs have been met with enthusiastic reception from investors, creating a favorable environment for seeking public-market liquidity.

Revenue Growth in 2020

The company experienced significant revenue expansion throughout 2020. TechCrunch has previously analyzed this growth, focusing on Robinhood’s income derived from payment for order flow (PFOF).

During congressional testimony, Robinhood indicated that PFOF constituted the majority of its revenue. Consequently, the growth in PFOF serves as a reliable indicator of the company’s overall financial performance.

As reported by TechCrunch, PFOF revenue increased substantially in 2020, rising from approximately $91 million in Q1 to $178 million in Q2.

This upward trend continued with $183 million in Q3 and $221 million in Q4 of the same year.

Additional Revenue Streams

Robinhood also generates revenue through consumer subscriptions and other diverse sources.

Implications of the Private Filing

The private filing indicates that a public offering is likely in the near future, although it may not occur quickly enough to include Q1 2021 financial results. Further details will be provided as soon as the filing becomes available.