Robinhood aims for public company debut on July 29

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By Matt Egan, CNN Business

Robinhood plans to debut as a public company next week.

The trading app is expected to begin trading on the Nasdaq stock market on July 29, a person familiar with the matter told CNN Business. The timing of the debut could still change, the person warned.

Robinhood aims to raise up to $ 2.3 billion in an initial public offering that could value the controversial company at $ 35 billion. This means that the IPO could make Robinhood more valuable than about two-thirds of the companies in the S&P 500.

Robinhood has not officially announced an IPO date. The platform’s IPO Access program, which allows users to request shares of companies at the IPO price before they start trading, lists July 29 as the scheduled IPO date for Robinhood.

The startup said it plans to live stream part of its roadshow on Saturday. Bloomberg News previously announced the timing of the IPO. Robinhood declined to comment.

The successful IPO comes amid a boom on Wall Street. Despite a massive selloff on Monday, US markets remain close to their all-time highs. The S&P 500 has nearly doubled since March 2020, when the pandemic broke.

Robinhood is betting that hot markets and its own rapid growth trajectory will overshadow the company’s legal and PR issues. Revenue soared 245% to $ 959 million last year as business activity and user growth increased.

Last month, Robinhood was hit with the biggest fine ever imposed by the Wall Street self-regulator for allegations he misled investors.

Robinhood is also heavily dependent on Order Flow Payment, where it receives revenue in exchange for routing retail orders to high-speed trading companies. Gary Gensler, chairman of the Securities and Exchange Commission, expressed concern about the “inherent” conflicts of interest that exist in this business model.

“These are not free applications. These are only commission free applications. The cost is inside of executing the order, ”Gensler told lawmakers at a May hearing on the GameStop saga.

Robinhood recently struck a deal with the family of Alexander Kearns. The 20-year-old trader committed suicide last summer after seeing a negative balance of $ 730,000 on his Robinhood account and mistakenly believing he owed that amount. Robinhood said its executives were devastated by Kearns’ death and that the company had improved its options trading and customer service.

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