Robinhood’s market debut: an ‘unconventional listing’
The disruptive app has hit the public markets it seeks to democratise. It could be a wild ride…

Robinhood marched its merry men to Wall Street last week in one of Nasdaq’s biggest IPOs in years, valuing the disruptive online brokerage at $32bn, said James Phillipps on Citywire. It was a fittingly “unconventional listing”: the company offered a third of its shares to its own customers. Hundreds of thousands signed up, only to see it flop. Shares fell by over 8% on the first day – a “limp opening” in “stark contrast” with Robinhood’s “stratospheric growth since the start of the pandemic”, during which it has “won over an army of fans, particularly among younger investors”, doubling its customer base to 31 million. Shares in the outfit, which offers equity, cryptocurrency and options trading as well as cash management, have since bounced back well above the $38 float price, said Maggie Fitzgerald on CNBC.com. They surged by more than 24% on Tuesday confirming, belatedly, the market’s faith in Robinhood’s mission “to democratise” finance.
The company, founded by Vlad Tenev and Baiju Bhatt in 2013, has “revitalised” a type of day trading last seen in the dotcom bubble at the turn of the century, said the FT. Robinhood’s pitch to investors – that everyone, not just the giants of Wall Street, should have access to the US stock market – has “become marketing folklore”. Investors on its app have sent stocks like Tesla, and cryptocurrencies such as dogecoin, to all-time highs – and brought discussion about financial markets “back to dinner tables across the US”. But its progress has also been “pockmarked by crisis and scandal”. Robinhood’s role in the January trading frenzy around the “meme stock” GameStop has come under congressional scrutiny. And it has faced fines and regulatory investigations for everything from lousy customer support to designing game-like features that inspire customers to compulsively check the app. “It’s easy to make positive speeches about democratising finance when everything is going up,” observes economist Patrick Krizan of Allianz. “It will be more interesting to see how people behave when we democratise the downturn.”
Perhaps Robinhood’s greatest contribution has been the “laudable” way it pioneered lower costs for investors, said The Economist. “For a time, the big retail brokers ignored the plucky upstart”, but after “a quick, brutal price war”, they all surrendered. There are plenty of caveats, said Matt Schifrin and Antoine Gara in Forbes. But “Robinhood’s long-term success and legacy” will depend on whether the good it is achieving – disrupting Wall Street and introducing millions of newcomers to investing – “outweighs the negative effects and risks”. The jury’s still out.
Subscribe to The Week
Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.

Sign up for The Week's Free Newsletters
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
Sign up for Today's Best Articles in your inbox
A free daily email with the biggest news stories of the day – and the best features from TheWeek.com
-
How to create a healthy 'germier' home
Under The Radar Exposure to a broad range of microbes can enhance our immune system, especially during childhood
-
George Floyd: Did Black Lives Matter fail?
Feature The momentum for change fades as the Black Lives Matter Plaza is scrubbed clean
-
National debt: Why Congress no longer cares
Feature Rising interest rates, tariffs and Trump's 'big, beautiful' bill could sent the national debt soaring
-
Pocket change: The demise of the penny
Feature The penny is being phased out as the Treasury plans to halt production by 2026
-
The UK-US trade deal: what was agreed?
In Depth Keir Starmer's calm handling of Donald Trump paid off, but deal remains more of a 'damage limitation exercise' than 'an unbridled triumph'
-
Shaky starts: A jobs drought for new grads
Feature The job market is growing, but Gen Z grads are struggling to find work
-
Work life: Caution settles on the job market
Feature The era of job-hopping for bigger raises is coming to an end as workers face shrinking salaries and fewer opportunities to move up
-
Saving the post office
Feature The U.S. Postal Service is facing mounting losses and growing calls for privatization. Can it survive?
-
Safe harbor: Gold rises as stocks sink
feature It's a golden age for goldbugs
-
What is the Mar-a-Lago accord?
Talking Point A Maga economic blueprint proposes upending the global financial system. Could it fly?
-
Elon Musk: has he made Tesla toxic?
Talking Point Musk's political antics have given him the 'reverse Midas touch' when it comes to his EV empire