Mar 23, 2021 - Economy

Robinhood files for public offering

Illustration of a teenager on a laptop covered in wall-street related decals including a bull, a trend line, and an emoji with dollar sign eyes

Illustration: Sarah Grillo/Axios

No-fee trading app Robinhood has filed confidential public offering papers, as first reported by Bloomberg and confirmed by Axios.

Why it matters: The move comes just a month after Robinhood came under fire for restricting certain stock trades.

Between the lines: It is unclear if the company plans to conduct a traditional IPO, in which Robinhood would raise capital from the public markets, or do a direct listing, whereby insiders like early investors and employees would reap the proceeds.

Backstory: Robinhood in February restricted the purchases of certain so-called "meme stocks," including GameStop and AMC, following a Reddit-fueled surge in trading activity. The company later said the pauses were driven by collateral requirements by its clearinghouse, although it took days for that explanation to be clearly communicated.

  • Robinhood, in the midst of the maelstrom, raised billions of dollars in new capital so as to not run into similar liquidity issues going forward.
  • Co-founder and CEO Vlad Tenev was later grilled on Capitol Hill, as part of a House hearing on retail investing.
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