Robinhood, the trading app which has been on the news on and off from the past few months has filed the necessary paperwork for an IPO, confidentially. Sources familiar with the matter told CNBC on Tuesday that the filing has been submitted to the Securities and Exchange Commission (SEC). However, there is no disclosure about the place where it would not trade its stock nor has it mentioned the size of its initial public offering (IPO).
The app has raised $3.4 billion in funding which was led by Ribbit. It included existing investors ICONIQ D1 Partners and Sequoia Capital among others. It has a supposed financial value of $30 billion. People familiar with the matter also say that it has set $26.6 million for settlements.
Earlier this year CNBC had reported that the company had plans to list its stock on the NASDAQ and that it had been consulting with the banker Goldman Sachs to handle its IPO which was supposed to be a direct public listing.
However, the company has been facing a series of controversies. Earlier this year it was embroiled in the Reddit saga when the WallStreetBets forum started the GameStop and AMC buying frenzy. The app was allegedly overwhelmed due to the abnormally high trading and it restricted trading. Many users have filed lawsuits blaming the restrictions for losses.
It has been hauled up in front of federal agencies and U.S. regulators along with the other players. It was also indirectly implicated in the suicide of one of its young users, for sending misinformation across.
Founded in 2013, the Menlo Park based app is popular among first time traders and small investors as they can buy part of a share of large companies. In 2018, it added Bitcoin, ethereum and other digital currencies increasing its user base.
The Robinhood app is also fairly easy to use and attracted 3 million users during the GameStop frenzy. The pandemic also brought in a large number of young users as they swipe it just like they swipe other popular apps.