Robinhood is huge, in two parts The F series round came in part in the second quarter and in part in the third quarter. The app-based trading platform announced the first $ 280 million in early May, valuing the company at around $ 8.3 billion, compared to a previous price of around $ 7.6 billion.
Then in July, Robinhood it earned $ 320 million more at the same price, bringing its valuation to around $ 8.6 billion.
While savings and investments in apps and services have long been known to boom in 2020, exactly what prompted investors to pay $ 600 million more into this already wealthy company has been less evident. Recent data published by Robinhood regarding one of its sources of revenue may help explain rapid-fire capital events.
The exchange explores startups, markets and money. You can read it every morning on Extra Crunch or receive the Exchange newsletter every Saturday.Robinhood's statements covering the period from April to June, second quarter 2020, indicate that the company's revenue comes from paying for order flow, a method by which a broker is paid to route customer orders through a certain group or a portion has increased during the period. As ProWellTech has covered, Robinhood generates a sizable portion of its revenue from such activities.
Society is almost alone in doing so. Like a new report from The Block, shared with The Exchange prior to the release notes, Robinhood's Q2 payment for the order flow has been impressive, but not individually; commercial houses such as E * Trade and Charles Schwab also increased their earnings by routing the flow of orders in the period.
But Robinhood's earnings stem from the company's promise to shake up its trading options after a client takes his own life. As we wrote, there is a tension between Robinhood's desire to limit who can access option trading, his need to grow and the flow of orders related to income options can push for the giant of the fintech giant.
This morning, however, we are focusing on revenue growth compared to other issues (others on subsequent issues). Let's analyze the revenue numbers of Robinhood's Q2 order flow and see what we can learn about its execution rate and current rating.
A great Q2
According to The Block's calculations, Robinhood saw its total payment for order flow revenue nearly double, going from $ 90.9 million in the first quarter of 2020 to $ 183.3 million in the second quarter of 2020, an increase of 102%.