Robinhood Markets Inc, the online brokerage firm in the epicenter of the historic retail frenzy that has swept Wall Street this year, has revealed regulators’ secret plans for an initial public offering in the United States, the company revealed on Tuesday.
The move to advance the stock market float comes at the middle of a historic boom in the US capital markets, driven largely by dealmaking through so-called special purpose acquisitions.
Data from Refinitiv and Dealogic showed that companies raised more than $ 100 billion through initial public offerings (IPOs) in the first three months of the year, as they prepare to surpass the record-breaking 2020 total of $ 167 billion.
The amount raised includes initial public offerings on a blank check.
Reuters reported in December that Robinhood had chosen Goldman Sachs Group Inc to lead preparations for the stock market float.
The company said in a blog post that the company has not yet determined the number of shares to be offered and the price range.
People familiar with the matter said Robinhood had considered rolling out a generic name through a direct listing in the weeks leading up to the introduction.
In direct listing, the company does not sell any shares before its market debut, as is the case with initial public offerings.
Robinhood was founded in Menlo Park, California in 2013 by Stanford University roommates Vlad Teneff and Paigeo Bhatt.
The company’s platform allows users to make unlimited trades without commissions in stocks, ETFs, options and cryptocurrencies.
The platform’s easy-to-use interface has made it a go-to for young investors who trade from home during the restrictions caused by the coronavirus, and its popularity has skyrocketed during the retail frenzy.
However, the company faced criticism after it had to limit trading in some stocks over social media that fueled the trading frenzy due to a 10-fold increase in deposit requirements in its clearinghouse.
She was forced to raise $ 3.4 billion in emergency funds after her finances were strained by the massive jump in retail trade.
Ribbit Capital led the financing rounds and included existing investors Iconiq, Andreessen Horowitz, Sequoia Capital, Index Ventures and New Enterprise Associates.
Robinhood’s recent funding was estimated to be worth nearly $ 30 billion, according to people familiar with the matter.
Robinhood is currently under investigation by US regulators over its temporary trade restrictions on so-called “meme stocks.” The company has allocated $ 26.6 million for a possible settlement of the March 2020 trading interruption, in addition to its options trading policies.