26 Apr Robinhood Shares Fall as Company Fires 9% of Full-Time Employees
Vlad Tenev – co-founder of the Robinhood trading app – announced on Tuesday that the company is letting go of 9% of its full-time employees. The company’s share price fell shortly afterward to just $10.00 at the time of writing – 12 cents above its all-time low as a public company.
According to the co-founder’s blog post, Robinhood experienced a period of hypergrowth from 2019 to 2021. Net funded accounts grew from 5 million to 22 million, and revenue from $278 million to $1.8 billion.
However, this resulted in the company multiplying its headcount from 700 to 3800 employees, leading to many “duplicate roles and job functions”. This has apparently led to added complexity/ reduced efficiency at the company, leading to its decision to downsize.
“While the decision to undertake this action wasn’t easy, it is a deliberate step to ensure we are able to continue delivering on our strategic goals and furthering our mission to democratize finance,” said Tenev.
The company maintains that it will continue its international expansion efforts, and be introducing new brokerage, crypto, and spending/saving products.
Robinhood grew popular in the crypto community as a Dogecoin trading app. It currently owns nearly one-third of all Dogecoin in circulation on behalf of its clients.
By comparison, the Grayscale Bitcoin fund is the largest single owner of Bitcoin, but only owns 3% of the coins in circulation on behalf of clients.
The app thrived most in Q2 of 2021 when Dogecoin reached its all-time high. However, the app’s revenue fell continuously in the following quarters.
Robinhood recently announced a Bitcoin lightning network integration, but its CEO still believes that Dogecoin could become the “future currency of the internet and the people.”
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