Robinhood Markets Inc. today submitted an updated version of the filing for its upcoming initial public offering that reveals the startup is seeking to raise as much as $2.3 billion from investors.

The financial technology startup also shared new data about its recent revenue growth. 

Founded in 2013, Robinhood provides a popular mobile app that enables users to trade stocks and other assets without paying commissions. Robinhood’s valuation passed $1 billion only about four years after its launch. Around the same time, the startup reached another milestone when it disclosed that the combined value of stock transactions made via its app had passed $30 billion.

Robinhood’s rapid growth has continued ever since, its IPO filing details. New data in the updated version of the document reveals that the startup expects to close the second quarter with revenues of $546 million to $574 million.

That’s more than double the $244 million it logged the same time a year earlier. Robinhood also disclosed that it projects a loss of between $487 million and $537 million for the second quarter, the result of the startup prioritizing growth over profitability. 

The company’s growth investments have paid dividends so far. Besides expecting a more than twofold increase in revenue, Robinhood’s estimates for the second quarter also show that it has 22.5 million so-called funded accounts, meaning user accounts tied to a bank account. That’s up from 18 million in the first quarter of 2021.

Robinhood said in the amended IPO filing that its platform is believed to account for close to half of all new funded retail investment accounts opened in the United States from 2016 to 2021. The startup has secured such a prominent position in the financial technology, or fintech, market that it’s influencing the business practices of established brokerages. In October 2019, several major brokerages, including Charles Schwab Corp., announced plans to eliminate stock trading fees just as Robinhood has done.

The company’s strong market position and fast growth are set to be reflected in the terms of its upcoming IPO. It disclosed today that it’s looking to sell 55 million shares at a price of $38 to $42 apiece. On the high end of the range, Robinhood would raise $2.3 billion from investors, which would make its offering one of the largest for a tech company this year.

A $2.3 billion IPO would also give the startup an initial market capitalization of about $35 billion. That potentially puts Robinhood on track to become one of the fintech sector’s most valuable companies behind Stripe Inc., which received a $95 billion valuation after a funding round earlier this year.

At $35 billion, Robinhood’s market capitalization would be more than three times the size of its last private valuation. That means the startup’s venture backers can potentially expect a big return on their investment. 

Robinhood has raised about $5.6 billion in venture funding to date, most of it through its most recent round, a $3.4 billion investment announced this February. The investment included the participation of many of the tech industry’s most prominent venture capital firms, including Ribbit Capital, ICONIQ Capital, Andreessen Horowitz, Sequoia and others.

Over the years, Robinhood used the capital it raised from investors to expand beyond trading stocks to other parts of the fintech market. The startup provides cryptocurrency trading features as well as a paid version of its app that offers, among other benefits, access to stock market research. Robinhood also provides a checking account-like product called Cash Management that consumers can use to pay for groceries and other purchases.

Even with the significant growth it has seen over recent years, the startup believes there still are significant opportunities for revenue expansion ahead. “Retail investing now comprises roughly 20% of U.S. equity trading volume, doubling in the decade from 2010 to 2020. Yet, we believe there is still significant room for growth,” Robinhood stated in its IPO filing.

The startup’s expectations for additional revenue growth in the future could boost investor interest in its stock after the IPO. Robinhood will float its shares on the Nasdaq with the help of lead IPO underwriters Goldman Sachs, Citigroup and JPMorgan. If the offering garners the strong investor demand that the startup expects, it could send an encouraging signal to other fintech providers planning to go public in the near term.

Image: Robinhood