Robinhood has amassed a $7 billion business in a mere span of six years. That’s the company’s financial status as it nears a $200 million funding round from its contemporary financial backers, Bloomberg stated. The investment system is still unwinding and once over with, could result in Robinhood getting a valuation as far as $10 billion.
Robinhood recorded its most recent funding round last year at which time a $5.6 billion amount was attached. The stock-trading app claims a remarkable track record of developing its user base and monetizing its administration. According to Nasdaq Daily, Robinhood Markets Inc. amassed $8 billion in wealth in 2017 and is visioned to bring in $47 billion yearly by 2020. It is already the quickest growing broker of all time.
Last year the investment app blew past 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. Robinhood is very much in prevalence with the people. The depreciation of commission fees is a big business point for millennials, who have less cash to forbear than their progenitors did when they were that age. The app’s friendly interface and slick design is also likely a draw for the young-ish crowd.
There’s no doubt that the mobile app’s choice of crypto-currency investments is also attractive to millennial savers and day-traders. One general survey found 43% of millennials confide in crypto exchanges more than stocks. A further 90% of millennials prefer crypto-currency to gold.
Robinhood’s profits are generated from three sources:
- Interest acquired by lending money contained in Robinhood accounts
- Selling orders to large-volume exchanges endeavoring more liquidation.
- Robinhood Gold subscriptions that charge users $10 to $200 a month to rent anywhere from $2,000 to as far as $50,000 to trade on margin.
The sale of orders to high-frequency exchanges is a practice that has attracted some criticism for lack of transparency.