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.”