The online broker Robinhood, which has set itself the goal of “democratizing finances for everyone” through commission-free trading, is holding a very unusual IPO roadshow this Saturday, July 24th.
Instead of presenting itself to investors in closed meetings, Robinhood will stream its IPO roadshow live on this website 3 p.m. – 4 p.m. ET / 12 p.m. – 1 p.m. PT. – Anyone can watch and the public was allowed to ask questions until Friday, July 23rd at noon.
The company, which is facing litigation and regulatory scrutiny due to its decision earlier this year to restrict trading in so-called meme stocks, plans to trade on the Nasdaq on July 29 under the ticker “HOOD” 38 to 42 US- Dollars, which equates to a potential valuation of around $ 35 billion.
The presentation will be divided into two main segments – one where Robinhood’s leadership will detail the company’s business model (3:05 p.m. ET / 12:05 p.m. PT) and a Q&A section with CEO and Founder Vlad Tenev together with CFO Jason Warnick (3:40 p.m. ET / 12:40 p.m. PT).
Other speakers who will present at the roadshow include founder Baiju Bhatt, Chief Legal Officer Dan Gallagher, Chief Operating Officer Gretchen Howard, Chief Marketing and Communications Officer Christina Smedley, Chief Product Officer Aparna Chennapragada, Head of Investor Relations and Capital Markets Irvin Sha and Vice President for Foreign Affairs and Community Mary Elizabeth Taylor.
Vlad Tenev, CEO of Robinhood Markets, will be seen witnessing the GameStop trade on February 18, 2021 in Washington, USA. House Committee on Financial Services / Handout via Reuters
The Q&A segment of the roadshow will allow everyday retail investors to connect with Robinhood executives in the event their question is selected, though the company warns that it may not be able to answer all of the questions.
“Like all companies going public, we are restricted by regulations about how we can go public,” said Robinhood’s website.
While IPO virtual roadshows are not entirely out of the norm in the face of the pandemic, Robinhood’s decision to publicly broadcast its roadshow live on its website provides a unique opportunity for retail investors to attend an event that would normally be reserved for large institutional investors.
The story goes on
“The IPO roadshow we are hosting is an opportunity for ordinary retail investors to take part in a Robinhood leadership presentation that is normally only offered to pre-IPO institutional investors,” said Robinhood’s website.
Robinhood has gained prominence in the wake of the surge in retail investment during the pandemic, and it has also caught the attention of lawyers and regulators. Just last month, the Financial Industry Regulatory Authority fined Robinhood a record $ 70 million fine for multiple failures by the company over the past year.
The company’s CEO was named to Congress earlier this year after Robinhood stopped buying meme companies like GameStop (GME). The incident drew attention to the controversial way Robinhood makes money – paying for the flow of orders (PFOF). Through PFOF, brokers like Robinhood receive payments for routing trades to certain market makers, which critics say creates a conflict of interest.
The intensified scrutiny of PFOF should be a red flag for investors, David Trainer, CEO of investment firm New Constructs, said in a recent statement.
“If regulators ever ban payment for the flow of orders, Robinhood’s revenues would be severely impacted, posing an alarming risk for investors,” wrote Trainer.
Thomas Hum is a writer at Yahoo Finance. Follow him on Twitter: @thomashumTV
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