Robinhood founders lose billionaire status

The founders of the Robinhood platform have ceased to be billionaires, according to the data of the American Forbes. Since the IPO, the company's shares have fallen in price by 60%.

Robinhood co-founders Vlad Tenev and Baiju Bhatt are no longer billionaires. Based on Robinhood's closing price of $13.89 per share on Wednesday, Tenev and Bhatt's net worth is now $845 million and $911 million respectively, up from peaks of $4.3 billion and $4.9 billion in August 2021.

Robinhood shares have already lost half (60%) of their value since the IPO. Since the beginning of 2022 alone (that is, in less than three weeks), stocks have fallen in price by almost 20%.

Forbes notes that both Tenev and Bhatt can regain their billionaire status: both founders have the right to receive company shares in the form of a reward if the value of Robinhood shares reaches certain values. According to the plan, entrepreneurs can receive 22.2 million and 13.32 million shares, respectively, over the next eight years.

Robinhood's share price will be impacted by fourth-quarter and full-year 2021 financials due on January 27. The latest report from investors disappointed: the company's quarterly revenue ($364 million) was 14% below analysts' forecasts and 35.4% less than in the second quarter. At the same time, the third quarter was a test of the potential of Robinhood: the main clients of the platform, small retail investors-newbies, after a turbulent first half of the year, which included the crazy Gamestop rallies and the general frenzy for the Dogecoin cryptocurrency, reduced trading volumes in the third quarter. As a result, Robinhood lost out in terms of growth to traditional brokers and large banks.