IN 2013, STANFORD UNIVERSITY STUDENTS Baiju Bhatt and Vlad Tenev came together to build a mobile stock trading app, Robinhood, which proved to be an instant hit among retail investors in the U.S. In an industry plagued with high transaction and broking charges, Robinhood created a niche for itself since its commercial launch in 2015. But the saga did not make for a happy reading.
In 2013, Stanford University students Baiju Bhatt and Vlad Tenev came together to build a mobile stock trading app, Robinhood, which proved to be an instant hit among retail investors in the U.S. In an industry plagued with high transaction and broking charges, Robinhood created a niche for itself since its commercial launch in 2015. But the saga did not make for a happy reading.
The company, which raised $5.6 billion from private investors prior to the IPO, is floundering. From its public issue price of $38 a share in July 2021, the stock is down 90% from its high of $85 and 73% from its IPO price to $10.39 (January 27, 2023).
For an app that has notched up 22.9 million users with 12.2 million monthly active users, the meltdown has its reasons.
The pandemic-fuelled boom in retail trading is fizzling out. Further, Robinhood's revenue stream from cryptos is in question. Not just that - it is blowing away money. In 2021, the brokerage firm incurred a $862 million loss on a net revenue of $978 million in the nine months of 2022.
Denne historien er fra February 2023-utgaven av Fortune India.
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Denne historien er fra February 2023-utgaven av Fortune India.
Start din 7-dagers gratis prøveperiode på Magzter GOLD for å få tilgang til tusenvis av utvalgte premiumhistorier og 9000+ magasiner og aviser.
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