Robinhood announced recently that it would be raising a new funding round of $350M led by DST Global on a $5.6B valuation. They also announced that Josh Elman, a general partner from Greylock, would be joining as VP Product.
The Wall Street Journal casually describes Robinhood as “Maker of App That Offers Free Stock Trades,” but these are very unusual events, even for the best of Silicon Valley startups.
Why is a general partner from one of the top Silicon Valley VCs joining a startup? And why is this startup all of a sudden worth so much?
Robinhood is reshaping financial services into a winner-take-all opportunity
There is a small group of companies that include Google, Facebook, Uber, Airbnb and Netflix that exhibit exceptional, winner-take-all dynamics. Ben Thompson of Stratechery calls them aggregators.
Never before Robinhood has a financial services company had all three characteristics of an aggregator: