Robinhood Chief Financial Officer Shiv Verma wants retail investors to receive larger slices of initial public offerings (IPOs). He said the brokerage will take part in the Anthropic IPO.
However, Robinhood does not set the split. Issuers and their banks decide. That share determines how many customers get shares at the offer price instead of buying on the open market.
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Why Are Companies Now Asking How Big Retail Can Go？
Anthropic told investors third-quarter revenue hit $16.8 billion, nearly 12 times a year earlier, Bloomberg reported. Its amended filing with the Securities and Exchange Commission (SEC) also lists about $895 billion in committed spending.
Robinhood is competing with other retail brokerages for access to that offering and later listings.
Meanwhile, some investors are waiting for Anthropic IPO pricing before backing OpenAI, which cut its funding target by $10 billion.
Historically, retail received only 1% to 5% of IPOs, Verma told Bloomberg Businessweek Daily on Monday. Companies now ask whether they can offer 10% or 20%, he said.
He cited retails roughly 25% share of the equities market to support larger allocations.
SpaceX said it wanted 15% to 20% for retail, Verma noted. Robinhoods own 2021 IPO, however, earmarked 20% to 35% of shares for customers, Axios reported.
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Verma said Robinhood routes customer demand to issuers and banks and argues the case for retail.
“We are making sure companies know that retail is here.”
Shiv Verma, Chief Financial Officer, Robinhood, on Bloomberg Businessweek Daily
Can Customer Demand Win a Bigger Anthropic IPO Slice？
Robinhood cannot take orders until an offering opens, and a regulatory quiet period before listings limits what Verma can disclose.
Instead, Verma cited customer activity, saying people are depositing and trading more, which he called a good sign.
Larger allocations also carry exposure. SpaceXs post-IPO slide took 20% off its peak within a week of its June listing.
As a result, if issuers keep raising retail quotas, brokerages could gain influence once held mainly by banks. Weak post-listing returns, though, could undercut that case.