This week, American Decacorn #robinhood went public, valuing the investment and wealth Fintech at $30 bn!
It is a great growth and performance story:
(1) AUM has grown to >$100 bn
(2) >8X growth over the last 18 months!
(3) Annual revenues of >$2 bn
(4) Profitable already today, with a highly scalable digital model
... in short, its $30 billion valuation, isn't a surprise at all, fundamentally.
Going forward, in the mega-large US wealth market, Robinhood could easily be >10X larger over the medium-term. That's tremendous upside.
The only question mark though is its ability to keep commanding a 250 bps ROA. The risk is not from as much from competition dynamics. Instead, the regulator (SEC) is reviewing the current industry practice and regulations around Robinhood's primary source of revenue - the spread it receives for its wholesale trades.
With its AUM growth potential, there is plenty to look forward to and Robinhood is clearly a contender for the future $100 bn+ market cap league table!
About AMX Partners: Based out of Singapore, we are a Fintech & FS focused Pan-Asia Boutique Strategy Consulting Firm. We have the vision to create, shape, scale and innovate Fintech, Digital Banks and FS firms, together with our clients