Shares of Goldman Sachs (GS) closed positive after news of the company leading Robinhood’s potential 2021 initial public offering or IPO. The offering could value the fintech company at more than $20 billion depending on market conditions.
Robinhood declined to comment and Goldman did not respond to a request for comment.
Robinhood was last privately valued at $11.7 billion following a September fundraising round and recently started interviewing potential bankers for an IPO in Q1 2021.
Robinhood’s investors include Andreessen Horowitz, D1 Partners, Google’s venture arm GV, Index Ventures, Kleiner Perkins, and Sequoia, according to PitchBook.
Robinhood, which helped popularize commission-free stock trading, particularly among millennials, has seen a new generation of novice traders flock its stock, options, and cryptocurrency trading platform during the pandemic. The platform currently has around 13 million users.
Critics have accused Robinhood of “gamifying” investing to the point that inexperienced clients can cause themselves substantial financial harm. This came to a head in June when a young options trader killed himself after seeing an extremely large negative portfolio value that was not reflective of his actual balance.
Some investors have also accused Robinhood’s novice traders of skewing the market. The company has also faced scrutiny from federal regulators. In 2019, Robinhood launched checking and savings products, hawking them as fully insured accounts with sky-high interest rates.
However, that wasn’t completely true, and the company was forced back to the drawing board.