Robinhood disclosed the fundraising boost after the online brokerage pulled back on trading curbs it imposed amid last week’s Reddit-fuelled market frenzy.
Robinhood Markets announced Monday that it had raised an additional $2.4 billion from existing shareholders, on top of the $1 billion it took in last week.
The latest financing round was led by Ribbit Capital and also includes Iconiq Capital, Andreessen Horowitz, Sequoia Capital, Index Ventures and NEA, Robinhood said in a blog post.
“This round of funding will help us scale to meet the incredible growth we’ve seen and demand for our platform,” Chief Financial Officer Jason Warnick said in the post.
Robinhood disclosed the fundraising after the online brokerage pulled back on trading curbs imposed in the wake of last week’s Reddit-fueled market frenzy. But as the tumult entered a second week, that hasn’t quelled customers’ suspicions of the firm’s motives.
Chief Executive Officer Vlad Tenev has tried in public appearances — including with Elon Musk — to explain why Robinhood halted trading in popular stocks including GameStop Corp. Still, that wasn’t enough for many customers. Despite the relaxation of trading limits — reducing the number of affected securities Sunday to eight from 50 — some of its more than 13 million users are angry that they were restricted at all.
Venture capital investors are key stakeholders for Robinhood, after they helped lift its valuation to about $11.7 billion in a September funding round.
The latest round, following last week’s emergency infusion, suggests its initial public offering hangs in the balance.
The current turmoil could delay Robinhood’s IPO, which is planned for as early as May, one person familiar with the matter said. True to its mission, the trading platform had considered an unusually retail investor-centric offering by allocating a significant minority of listed shares to clients, Bloomberg reported in January. No final decision on that plan had been made at the time.
The latest fundraising was reported earlier by the Wall Street Journal.