Robinhood shareholders: Who owns the most HOOD stock?
The share price for US retail trading platform Robinhood (HOOD) plunged by 30% in two days on investor concerns that the company is exposed to a liquidity crunch at the FTX cryptocurrency exchange.
FTX founder Sam Bankman-Fried bought a 7.6% stake in Robinhood in May, and there was speculation on the market that he would have to sell shares to release personal liquidity.
As of 11 November, HOOD stock is down over 50% year-to-date (YTD), trading at roughly $9 a share, having halved in value from over $18 in early January.
Live Robinhood (HOOD) Stock Price Chart
Who owns the most shares of Robinhood and how exposed is the company to the FTX fallout?
If you’re considering investing in Robinhood, it’s important to understand who owns the largest stakes in the company. Shareholders with large holdings can affect a company’s share price if they buy or sell large volumes of the stock.
To answer those questions, we took a look at the company and the breakdown of Robinhood shareholders below.
What is Robinhood?
Founded in 2013, California-based Robinhood Markets is a financial technology (fintech) firm that operates an online stock brokerage. Founders Vladimir Tenev and Baiju Bhatt had previously built high-frequency trading platforms for financial institutions.
Robinhood’s platform allows investors to trade stocks, exchange-traded funds (ETFs), options, and American depositary receipts (ADRs) commission-free, which has made it popular among individual retail investors with small accounts. It also allows users to trade some cryptocurrencies and recently launched beta testing of a self-custody, web3 wallet app.
The company makes money in three main ways:
Payments from market makers for order flow
Interest on investing users’ cash deposits
Premium Robinhood Gold subscription services
Robinhood was listed on the Nasdaq Stock Exchange in July 2021 in a $2bn initial public offering (IPO). The stock opened trading on 29 July 2021 at $38 a share and soared to an intraday high of $85 on 4 August 2021. But the share price has since been in decline as a drop in cryptocurrency trading and the bearish stock market has pulled down revenues.
The stock fell below the IPO price in late October 2021 and ended the year at $17.76. The company has continued to underperform expectations in 2022, and the share price dropped to a new low of $6.81 in the stock market selloff in mid-June.
The share price rebounded to $11.87 on 7 November, a gain of 74% from the low, but then fell to $8.29 on 9 November in the wake of the FTX turmoil that saw Binance back out of rescuing the exchange through a takeover.
As of 11 November, the stock is trading around the $9 mark.
Robinhood (HOOD) stock price, 2021 - 2022
Source: NASDAQ, via TradingView
Emergent Fidelity Technologies, an investment vehicle of FTX founder Bankman-Fried, bought 56.27mn shares in Robinhood in May, equivalent to a 7.6% stake in the company, according to a filing with the US Securities and Exchange Commission (SEC). The stake was worth around $648m at the time. The news was followed by Robinhood’s share price jumping by as much as 36%.
However, Robinhood co-founder Tenev stated on 10 November: “Despite SBF having an equity stake in Robinhood, we have no direct exposure to Alameda, FTX, or any of its entities, and we've confirmed with our partners that they don't have material exposure either.”
Despite SBF having an equity stake in Robinhood, we have no direct exposure to Alameda, FTX, or any of its entities, and we've confirmed with our partners that they don't have material exposure either.
— VLAD (@vladtenev) November 10, 2022
Robinhood traded up from the low to above $9 per share on 10 November.
Who owns the most shares in Robinhood, and what is the breakdown between institutional, insider and retail investors?
What is your sentiment on HOOD?
Robinhood biggest shareholders
Who are the shareholders of Robinhood with the largest stakes in the company? Robinhood’s 25 biggest stockholders own 68.33% of the shares, according to data from analytics platform Simply Wall Street as of 11 November.
Institutional investors own 282.7m shares (31.9% of the stock), retail investors own 223.6m shares (25.2%), venture capital and private equity firms hold 186.6m shares (21%), individual insiders hold 133.4m shares (15%) and private companies own 56.5m shares (6.4%).
Robinhood shareholders have seen their holdings diluted in the past year, as the company has increased its total shares outstanding by 3.1%.
Robinhood’s top institutional investors
The largest institutional HOOD shareholders include technology-focused venture capital firm Index Ventures, asset management firm Vanguard Group, and investor Cathie Wood’s ARK Investment Management.
Index Ventures
Dual headquartered in San Francisco and London, Index Ventures invests in technology companies in e-commerce, fintech, and infrastructure/artificial intelligence, as well as mobility, gaming, and security. The firm holds 76.4mn shares in the company after selling 3.3mn in August, according to an SEC filing, leaving it with an 8.62% stake.
Index Ventures partner Jan Hammer sits on Robinhood’s board, having invested in the company’s Series A financing. “Robinhood began with the notion that a lean and agile, technology-driven brokerage could strip out the fixed costs of incumbents to offer zero commission trades on smartphones and tablets. Today, the team is close to delivering on their vision – and from the day we met, it was a conviction that we shared,” read the Index Ventures’ website.
DST Global
DST Global is a US-based venture capital and firm that invests in late-stage internet companies. DST Global is a highly influential VC investor with an estimated $50bn in assets under management.
DST Global led Robinhood’s $323m Series E financing round in July 2019 and reported holding 58m shares in Robinhood as of 30 June, amounting to a 6.55% stake.
Ribbit Capital
US-based Ribbit Capital invests in early-stage companies aiming to disrupt financial services. As of 1 October 2022, the venture capital firm had increased its Robinhood holdings from 26.5m shares at the end of June to 52m shares, for a 5.87% stake.
Vanguard Group
The world’s second largest asset manager behind Blackrock, US investment firm Vanguard offers a range of investment products, advisory and retirement services. Vanguard was at the forefront of creating index-tracking funds to make stock markets easily accessible for retail investors.
Vanguard held 43.8m shares in Robinhood, as of 30 June 2022, according to an SEC filing, up from 40.2m at the end of the first quarter, giving it a 4.94% stake.
ARK Investment Management
ARK is an investment firm founded in 2014 by Cathie Wood. It focuses on companies developing “disruptive technologies”. ARK provides active management products, including funds and managed accounts, and had $24bn in assets under management, as of 30 June 2022.
The firm held a 3.71% stake of 32.9m Robinhood shares at the end of September, down from 33.6m shares at the end of the second quarter.
Robinhood major shareholders among individuals
Who are the biggest individual shareholders of Robinhood? Aside from Sam Bankman-Fried, they include company executives such as co-founders Tenev and Bhatt, who hold all of the company’s Class B stock, giving them 63% of the voting power. Robinhood has three classes of common stock, with Class A shares being the only publicly traded stock.
Baiju Bhatt
Robinhood co-founder and Chief Creative Officer Baiju Bhatt is one of Robinhood’s biggest shareholders. The Simply Wall Street data shows that Bhatt owned 68.5m shares in the company, amounting to a 7.72% stake. That includes 399,032 Class A shares held directly and 1.38mn held in an indirect trust, according to an SEC filing dated 1 November. Bhatt also held 11.5mn market-based performance stock units, the filing showed.
Vladimir Tenev
Co-founder and CEO Vladimir Tenev held 62.67mn shares in Robinhood, for a 7.07% stake, according to Simply Wall Street. That includes 1.4m Class A shares, 2,337 shares in an indirect trust and 11.5m market-based performance stock units, according to an SEC filing dated 1 November.
Sam Bankman-Fried
FTX founder Sam Bankman-Fried acquired 56.27m Robinhood Class A shares in May through Emergent Fidelity Technologies, a holding company of which he is the only director and majority owner. The shares are now equivalent to a 6.35% stake in the company, according to Simply Wall Street.
Bankman-Fried acquired the stake “in the belief that the Shares represent an attractive investment”, according to the filing, with the intention of holding the shares as an investment and not “taking any action toward changing or influencing the control” of the company.
Gretchen Howard
Gretchen Howard joined Robinhood in January 2019 as Vice President of Operations and was promoted to Chief Operating Officer in June 2019. As of 1 November 2022, Howard held 520,966 Class A shares directly and 168,064 indirectly through a trust, according to a filing. She also held 16,429 restricted stock units.
Jason Warnick
Robinhood’s CFO Jason Warnick owned 491,877 Class A shares, as of 1 November, and held 14,584 restricted stock units, according to an SEC filing. Warnick joined Robinhood as CFO in November 2018 after 20 years at online retail giant Amazon (AMZN).
The bottom line
It can be helpful for retail investors to understand a company’s share ownership, as large stock purchases and sales can have a significant influence over the share price. You can keep track of the trading activity of Robinhood’s major shareholders by checking its SEC filings – regulations require companies and large shareholders to disclose substantial changes in their share ownership.
However, you should know that the trading activity of Robinhood shareholders is only a small part of the picture and should not be the main reason you decide to buy or sell the stock.
Whether HOOD stock is a suitable investment for you will depend on your investing goals, trading strategy, risk tolerance, and the size of your portfolio. It is essential that you do your own research before making any investment or trading decision. And never invest or trade money that you cannot afford to lose.
FAQs
How many Robinhood shares are there?
Robinhood has 886.76mn shares, according to data compiled by Simply Wall Street.
How many shareholders does Robinhood have?
Robinhood has 476 institutional shareholders that have filed ownership forms with the Securities Exchange Commission (SEC), according to data provider Fintel.
Who owns the Robinhood company?
Institutional investors own 31.9% of Robinhood’s stock, with retail investors holding 25.2%, private equity firms 21%, individual investors 15%, and private companies accounting for 6.4%, according to Simply Wall Street.
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