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Robinhood raises another $2.4bn

Robinhood raises another $2.4bn

Robinhood has raised $2.4 billion on top of the $1 billion announced on Friday as it struggles to keep up with huge trading demand associated with the Reddit-led assault on stocks such as GameStop.

The round - in the form of convertible debt financing - was led by Ribbit Capital, with participation from existing investors including Iconiq Capital, Andreessen Horowitz, Sequoia, Index Ventures, and NEA.

Last week Robinhood stopped users from buying dozens of stocks that day traders who use the WallStreetBets subreddit had targeted in a short squeeze assault. The limits have since been removed for most stocks.

The surge in trading saw Robinhood face up to increased deposit requirements at clearing houses settling its trades. On Sunday CEO Vlad Tenev said that the firm's equity clearing house had asked for $3 billion in margin deposits on Thursday before cutting this down to $700 million.

In a blog, Robinhood says the new money will be used to "build and enhance our products" and invest in "expanding access to financial literacy".

"We’re confident that Robinhood will emerge stronger through this phase of growth and unprecedented demand," says Micky Malka, managing partner, Ribbit Capital.

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