Neil here. I hope you had a fantastic long weekend!
My family and I had a great Fourth of July holiday. But in between all the family fun, I couldn’t help but notice just how wild the last few days have been in the news cycle.
Andy Jassy is officially Amazon’s new CEO, while Jeff Bezos is suiting up to go to space…
China is cracking down on big tech IPOs… The Tokyo Olympics are almost here…
The West Coast heat wave shows no signs of stopping… And that’s just the tip of the iceberg.
After just a few days, it’s enough to make your head spin.
Now, we’ll break down the most important headlines through the week. But today, I want to dig into another headline… one that’s turning out to be one of the craziest the investing world has seen all year.
I’m talking about Robinhood, the app designed to democratize trading for the everyday investor.
The company has officially filed to go public in what’s expected to be over a $40 billion IPO. Once it hits the market, it’ll trade under the ticker $HOOD.
Now, Robinhood’s IPO is one of the most highly-anticipated offerings of the year, but this announcement is yet another headline on what’s been an absolutely crazy year for the company.
Each one of those numbers represents triple digit growth from where the company stood in just March 2020, and the company expects to keep growing rapidly.
That’s an impressive gain, but it’s Robinhood’s earliest investors who’ll strike the most gold when the company officially leaves the private equity world.
Robinhood’s first publicly-available valuation comes from its Series C funding round in April 2017, which valued the company at $1.3 billion – officially launching it to unicorn status.
From its Series C round to its anticipated IPO valuation, early stage Robinhood investors could see almost 3,000% gains if they got in back then. Investors who got in even earlier than that could see even more money in their pockets.
But there’s another angle to this story… one that’s even more important than anything I’ve mentioned above already.
It’s a bad idea to start investing your money if you don’t know what you’re doing. The best thing to do is get all the information you can before you begin, so you’re more prepared to handle the inevitable risk.
Robinhood has faced serious scrutiny this year for this exact reason.
In June, Robinhood paid a whopping $70 million FINRA penalties for system outages and reportedly misleading its customers. The first issue – the system outages – took place on some of the heaviest trading days in March 2020, essentially shutting customers out of trading equities, options, and crypto.
The second issue alleges that Robinhood communicated misleading information about risky trading practices like options and trading on margin. And because it’s a trading app built on providing wealth-building opportunities to everyday investors – not Wall Street bigwigs – having access to authentic and honest information is extremely important.
In fact, some Redditors – the folks at the helm of the massive GameStop short and more – have warned users to forget Robinhood’s IPO altogether. That warning comes despite Robinhood’s attempt to attract that exact crowd of retail investors to its IPO… and its announcement in May that it would roll out IPO access to its users.
At the end of the day, I’m interested to see exactly how this IPO plays out after what’s been an extremely hectic, complicated, and wild year for the company. But one thing’s for sure…
The value of understanding the ins-and-outs of investing has never been more important than it is right now, no matter what kind of investing you’re doing.
Here, we’re all about startups… And that’s exactly what I emphasize here at The Startup Investor and at the Angels & Entrepreneurs Network.
We work hard to pull together comprehensive reports on the latest startup news, what we believe are the next greatest angel investing opportunities, the need-to-know educational materials, and more… all so you can make the very best decisions for your wallet and portfolio.
In fact, we’ve already recommended over 100 deal opportunities across all of our subscription levels, and we have no plans to slow down anytime soon.
We’d love to have you on board for what’s to come! Just click here to learn how to get started for just $39 a year.
I can’t wait to see you over there.
Have a great rest of your day, and I’ll be back soon with another update.
Until next time,
Neil Patel
My family and I had a great Fourth of July holiday. But in between all the family fun, I couldn’t help but notice just how wild the last few days have been in the news cycle.
Andy Jassy is officially Amazon’s new CEO, while Jeff Bezos is suiting up to go to space…
China is cracking down on big tech IPOs… The Tokyo Olympics are almost here…
The West Coast heat wave shows no signs of stopping… And that’s just the tip of the iceberg.
After just a few days, it’s enough to make your head spin.
Now, we’ll break down the most important headlines through the week. But today, I want to dig into another headline… one that’s turning out to be one of the craziest the investing world has seen all year.
I’m talking about Robinhood, the app designed to democratize trading for the everyday investor.
The company has officially filed to go public in what’s expected to be over a $40 billion IPO. Once it hits the market, it’ll trade under the ticker $HOOD.
Now, Robinhood’s IPO is one of the most highly-anticipated offerings of the year, but this announcement is yet another headline on what’s been an absolutely crazy year for the company.
First, let’s talk growth.
As of July 1, Robinhood has 18 million retail clients, $80 billion in customer assets, and $522 million in Q1 2021 revenue alone.Each one of those numbers represents triple digit growth from where the company stood in just March 2020, and the company expects to keep growing rapidly.
Next, let’s talk early investors.
Robinhood is one of the most valuable unicorns in Silicon Valley. Right now, it’s valued at around $11.7 billion, and an IPO could value the company at around 241% more than that.That’s an impressive gain, but it’s Robinhood’s earliest investors who’ll strike the most gold when the company officially leaves the private equity world.
Robinhood’s first publicly-available valuation comes from its Series C funding round in April 2017, which valued the company at $1.3 billion – officially launching it to unicorn status.
From its Series C round to its anticipated IPO valuation, early stage Robinhood investors could see almost 3,000% gains if they got in back then. Investors who got in even earlier than that could see even more money in their pockets.
But there’s another angle to this story… one that’s even more important than anything I’ve mentioned above already.
That angle is investor education.
Whether you’re a seasoned trader or a market rookie, investing is risky business.It’s a bad idea to start investing your money if you don’t know what you’re doing. The best thing to do is get all the information you can before you begin, so you’re more prepared to handle the inevitable risk.
Robinhood has faced serious scrutiny this year for this exact reason.
In June, Robinhood paid a whopping $70 million FINRA penalties for system outages and reportedly misleading its customers. The first issue – the system outages – took place on some of the heaviest trading days in March 2020, essentially shutting customers out of trading equities, options, and crypto.
The second issue alleges that Robinhood communicated misleading information about risky trading practices like options and trading on margin. And because it’s a trading app built on providing wealth-building opportunities to everyday investors – not Wall Street bigwigs – having access to authentic and honest information is extremely important.
In fact, some Redditors – the folks at the helm of the massive GameStop short and more – have warned users to forget Robinhood’s IPO altogether. That warning comes despite Robinhood’s attempt to attract that exact crowd of retail investors to its IPO… and its announcement in May that it would roll out IPO access to its users.
At the end of the day, I’m interested to see exactly how this IPO plays out after what’s been an extremely hectic, complicated, and wild year for the company. But one thing’s for sure…
The value of understanding the ins-and-outs of investing has never been more important than it is right now, no matter what kind of investing you’re doing.
Here, we’re all about startups… And that’s exactly what I emphasize here at The Startup Investor and at the Angels & Entrepreneurs Network.
We work hard to pull together comprehensive reports on the latest startup news, what we believe are the next greatest angel investing opportunities, the need-to-know educational materials, and more… all so you can make the very best decisions for your wallet and portfolio.
In fact, we’ve already recommended over 100 deal opportunities across all of our subscription levels, and we have no plans to slow down anytime soon.
We’d love to have you on board for what’s to come! Just click here to learn how to get started for just $39 a year.
I can’t wait to see you over there.
Have a great rest of your day, and I’ll be back soon with another update.
Until next time,
Neil Patel
Follow @angelsandentrepreneurs
