Robinhood, the no fee stock trading app for Android and iPhone, recently completed a round of fundraising that will enable it to compete with brokerage firms that charge up to $10 per trade. According to TechCrunch.com, investment company DST Global has led the fundraising, and the current valuation of Robinhood is now $1.3 billion dollars.
Robinhood began offering its services in 2013, claiming to be a vehicle for the “everyman” to begin investing. The application is easy to use and offers users the ability to track and trade stocks with no added costs. Unlike traditional brokerages, Robinhood has no brick and mortar locations, which saves them money.
These savings are then passed on to their traders. Last year, Robinhood launched a premium option, called Robinhood Gold, which allows users to make deposits and trades instantly instead of needing to wait three days. This $10 per month option is the primary source of revenue for the Robinhood team, and its success allowed the team to reach a $1.3 billion valuation after a very successful round of fundraising.
Image credit: Investopedia