Robinhood, gateway to ‘meme’ stocks, raises $2.85 billion in IPO: Source

NEW YORK (REUTERS) – Robinhood Markets, the owner of the trading app which emerged as the go-to destination for retail investors speculating on this year’s ‘meme’ stock trading frenzy, raised US$2.1 billion (S$2.85 billion) in its initial public offering (IPO) on Wednesday (July 28).

The company is seeking to capitalize on individual investors’ fascination with cryptocurrencies and stocks such as GameStop, which have seen wild swings after becoming the subject of trading speculation on social media sites such as Reddit. Its monthly active users surged from 11.7 million at the end of December to 21.3 million as of the end of June.

Robinhood sold 55 million shares in its IPO at US$38 apiece, the bottom of its targeted price range of US$38 to US$42, a person familiar with the matter said on Wednesday. In an unusual move, Robinhood had said it would reserve between 20 per cent and 35 per cent of its shares for its users.

The IPO values Robinhood at US$31.8 billion. It makes it one of the most valuable US companies to have gone public year to date, amid a red-hot market for new listings.

The source requested not to be identified ahead of an official announcement. Robinhood did not immediately respond to a request for comment.