Robinhood IPO Access – Everything You Need to Know
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On Thursday, May 20th, 2021 Robinhood launched its new IPO investing platform called Robinhood IPO Access. The Robinhood IPO investing functionality is now live.
Reuters had a scoop on this news about two months earlier. I wrote about the platform at the time, but now we know more details.
With at least 20 million eligible customers, Robinhood is one of the largest IPO investing platforms with the lowest minimum account balance ($0) required for eligibility.
The company has built the platform into its existing mobile application.
Robinhood does not underwriting IPOs. Instead, it partners with underwriters and relies on the investment banks for share allocations.
Since 2021, Robinhood has done proved it can convince the banks to allocate shares, having launched at least 25 deals as of Q2 2025.
Though several deals have fallen from their IPO prices, many have had strong performances, including Robinhood’s own IPO, CoreWeave, Circle, ARM, Instacart, and Duolingo.
Robinhood IPO Investing for Everyone
All customers have access to IPOs on the Robinhood IPO Access investing platform.
There are no minimum account balances or trading frequencies needed to indicate interest in an IPO. However, share allocations are never guaranteed.
Robinhood has at least 20 million customers, so high-demand IPOs have a high number of requests.
Share Distribution
Share distribution will be randomized. All eligible customers who request access to specific IPOs will be put into a pool, and the system will randomly select which investors receive shares.
Notably, the more shares you request, the more you are likely to receive.
For example, during the Circle IPO, customers and Access IPOs subscribers received 11%-16% of their requested allocation.
Customers who requested 10 shares only received one or two. But once reader requested 1,000 shares and received 109.
According to the FAQs:
The amount of shares you request factors into how many you actually get, but it doesn’t affect the likelihood that you’ll get any allocation. You may get all, some, or none of the IPO shares you request. The amount you request lets us know how many shares you’re interested in purchasing.
Robinhood IPO Flipping Policy
Robinhood doesn’t prevent customers from immediately selling, or “flipping”, shares through the IPO Access program.
However, the following consequences apply:
- If customers sell IPO shares within 30 days of the IPO, they will be restricted from participating in IPOs for the next 60 days.
- Broad-based flipping could reduce the underwriters’ willingness to allocate shares to Robinhood IPO Access customers.
In other words, don’t sell shares within 30 days or you will be restricted from IPO for the next two month, and you may receive other restrictions in the future.
Furthermore, if Robinhood customers prove to be active flippers, it could impact the platform’s future allocations from investment banks.
This policy may be subject to change if investors are flippant on the flipping rules.
The First IPO
The first IPO on the platform was Figs, Inc, which debuted on May 27th, 2021. The S-1 included a clause about the Robinhood participation.
…we currently anticipate that up to 1.0% of the shares of Class A common stock offered hereby will, at our request, be offered to retail investors through Robinhood Financial, LLC, as a selling group member, via its online brokerage platform.
The Figs IPO lead underwriters were Goldman Sachs and Morgan Stanley. Which suggested more IPOs led by those two underwriters would make it to the Robinhood IPO Access platform. That has proven to be true.
The Fig IPO gave Robinhood the chance to test its platform on a smaller deal before potentially facilitating its own IPO (more below).
Did Customers Receive Shares in the Robinhood IPO?
Yes. Robinhood investors were able to invest in the Robinhood IPO through IPO Access.
Reporting in January by Bloomberg first told us that Robinhood customers would receive access to shares in the Robinhood IPO.
The Robinhood IPO date was Thursday, July 29th, 2021. The stock began trading at 12:25pm EST. Underwriters priced the IPO at $38 Wednesday evening. The stock opened for trading at $38.
The S-1 filing was released to the public on July 1st, with amended versions published on July 19th and July 27th, 2021.
Robinhood IPO Terms
- Number of shares: 55 million
- Raise $2.1 billion
- IPO price range $38 to $42 per share
- Final IPO price $38 per share
- Valuation $32 billion
- Lead Underwriter Goldman Sachs
Directed Share Programs
As of November 2021, Robinhood has expanded its IPO offerings to include directed share programs, according to Reuters. Directed share programs allow underwriters and issuing companies to direct a percentage of shares to affiliates.
Affiliates can mean anyone the company wishes to include. However, it’s sometimes utilized to offer shares to company customers. Airbnb, Uber, and GoPro all offered IPO access via directed share programs to hosts, drivers, and customers.
The new offering could expand the way Robinhood pitches startups looking to IPO.
Final Thoughts
The Robinhood IPO investing platform news was a big step toward giving IPO access to everyone. This website has been advocating for this since the early days of LOYAL3.
Robinhood is tapping into its massive user base to give everyone an equal shot at investing in hot IPOs.
Of course, not everyone can invest in every high-demand IPO. But by randomizing allocation distribution, Robinhood is making the process fairer given the current environment.
Craig Stephens is a former IT professional who left his 19-year consulting career at the IRS to be a full-time finance writer. He started Access IPOs in 2016 to provide a resource for ordinary investors pursuing investment access to IPOs and pre-IPO startups. Craig studied Finance at Michigan State University and lives in Northern Virginia with his wife and three children. Learn more about Craig.
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