Robinhood the American retail brokerage firm filed for its IPO on Thursday. Here are some interesting bits from their prospectus:
- Robinhood has 18.0M funded accounts of which 17.7M are monthly active users, and has $81B in assets under custody with over 50% of customers being first-time investors.
The $81B of Robinhood’s assets under custody include: Equities - $65B, Options - $2B, Crypto - $11.5B, Cash - $7.6B, Margin - $5B.
Core products for Robinhood include their trading platform, crypto trading, and cash management. With their retail brokerage and crypto trading making up the majority of their revenue.
The fastest-growing product segments of Robinhood (by transaction revenue) are:
- Crypto: which is growing 1,967%
- Equities: which is growing 322%
- Options: which is growing 231%
Over the last two years, Robinhood has seen crazy user growth. They ended 2019 with 5.1M accounts while adding 5.5M funded accounts in the first quarter of 2021 alone.
The below image gives us how the trading activity has increased over the last year due to COVID-19, from the second quarter of 2020 till today compared to financial years 2018 and 2019.
In the financial year 2020, Robinhood reported a record revenue of $958M in revenue of which 80% of their revenue is generated through payment for order flow and other transaction fees. 12% of their revenue is generated through net interest margin on idle cash and 8% of their revenue is generated through Robinhood Gold (premium accounts).
If you want to read more you can refer to Robinhood’s IPO prospectus here.
