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

Robinhood Attracts $200 Million as Valuation Swells to $7 Billion: Report 1

By CCN: 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, Robinhood has 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 to Nasdaq, 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 app blew passed E*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.

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 profits come from three 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 that has attracted some criticism for a lack of transparency.

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 nationwide survey found 43% of millennials trust crypto exchanges more than stock exchanges. A further 90% of millennials prefer cryptocurrency to gold.

Robinhood Co-Founder and co-CEO Baiju Bhatt told CNBC last 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.”

[embedded content]

[youtube https://www.youtube.com/watch?v=iHN0f2WNLkE?feature=oembed&w=680&h=383]

About the author

E-Crypto News was developed to assist all cryptocurrency investors in developing profitable cryptocurrency portfolios through the provision of timely and much-needed information. Investments in cryptocurrency require a level of detail, sensitivity, and accuracy that isn’t required in any other market and as such, we’ve developed our databases to help fill in information gaps.

Related Posts

E-Crypto News Executive Interviews

Automated trading with HaasBot Crypto Trading Bots

Blockchain/Cryptocurrency Questions and Answers

What Are E-stablecoins And How Do They Operate?
What Are E-Stablecoins And How Do They Operate?
August 11, 2022
How to Choose a Legit Crypto Casino?
August 5, 2022
Spend Crypto
5 Ways to Spend Crypto
August 2, 2022
What Is A DAO LLC?
What Is A DAO LLC?
August 2, 2022
Can Running A Lightning Node Earn You Passive Income?
Can Running A Lightning Node Earn You Passive Income?
July 5, 2022


CryptoCurrencyUSDChange 1hChange 24hChange 7d
? --- 0.00 % 0.00 %
Ethereum1,876.7 0.15 % 1.13 % 5.69 %
Tether1.003 0.29 % 0.25 % 0.16 %
USD Coin1.000 0.44 % 0.25 % 0.18 %
? --- 0.00 % 0.00 %
? --- 0.00 % 0.00 %
? --- 0.00 % 0.00 %
Binance USD0.9995 0.04 % 0.09 % 0.25 %
Solana42.12 0.56 % 2.22 % 3.81 %
? --- 0.00 % 0.00 %

bitcoin
Bitcoin (BTC) $ 24,004.00
ethereum
Ethereum (ETH) $ 1,893.60
tether
Tether (USDT) $ 0.999483
usd-coin
USD Coin (USDC) $ 0.999051
bnb
BNB (BNB) $ 315.72
cardano
Cardano (ADA) $ 0.566499
xrp
XRP (XRP) $ 0.376169
binance-usd
Binance USD (BUSD) $ 1.00
solana
Solana (SOL) $ 43.52
dogecoin
Dogecoin (DOGE) $ 0.085766