Commission-free investing app Robinhood has officially raised its latest round of funding, bringing in $323 million at a $7.6 billion valuation, up $2 billion from its Series D valuation in 2018. The investment is led by DST Global, the firm run by Russian billionaire Yuri Milner, and includes participation from new and existing investors such as Ribbit Capital, NEA, Sequoia and Thrive Capital.
The Silicon Valley company, whose mobile app lets users buy and sell public stocks without trading fees, said that it would use the funds to increase hiring and develop new products around its stock trading app, which has more than four million users. The seven-year-old startup has been growing at an explosive rate, doubling the number of accounts in the past year.
Robinhood’s offering is particularly popular among the “millennial” population, who appreciate the ease of using the app to trade several asset classes without fees.
Closing in on rival E*Trade
Hitting more than 4 million users isn’t the only milestone for Robinhood. The company has reportedly attracted more than $150 billion in transaction volume since its introduction. The impressive metrics mean that the New York startup has been able to bring on nearly as many customers as E*Trade, which has been in the online brokerage industry since 1982.
Robinhood is one of the fastest-growing players in the red-hot financial technology segment. And as the company is moving closer towards going public, it has recently attracted a number of high-profile Wall Street’s experts, including Jason Warnick who spent 20 years at Amazon.
Robinhood Crypto got off to a good start last year. It seeks to carve out its niche by letting traders buy and sell cryptocurrency for $0 a trade. In doing so, the company makes money from order flows, a common tactic used by discount brokers to generate revenue by directing orders to certain trading venues. The company also receives interest on unused cash deposits from user accounts and offers a premium paid account for $10 per month, which gives users added features.