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To: Glenn Petersen who wrote (156)2/1/2021 10:15:41 PM
From: Thehammer
   of 189
Cowboys. Presumably, they have changed out their legal team. It will be interesting to see how they fare now that they have attracted the attention of our bottom-feeding, attention-grabbing Congress critters.

I guess you have to blame someone. Changing out the legal team though can be a tough transition.

Some of this has been going on forever. Even before the internet - frenzies developed around certain securities and they got bid up to oxygen deprived levels. You didn't have short hedgies on the other side though.

I never quite got the differentiation of Robin Hood as zero cost trades are available all over.

May you live in interesting times!

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From: Glenn Petersen2/25/2021 8:17:09 PM
   of 189
Robinhood is still on track for a hot IPO despite the GameStop uproar

UPDATED THU, FEB 25 202111:00 AM EST
Maggie Fitzgerald @MKMFITZGERAL
Kate Rooney @KR00NEY


-- Robinhood’s user growth, brand recognition and valuation appear to be stronger than ever despite the GameStop trading chaos.

-- The free-trading app gained 3 million users last month alone, according to estimates from JMP Securities and demand for its pre-IPO shares is high.

-- “Despite some positive and negative press, everyone in the world knows who Robinhood is. They couldn’t have better free advertising,” said Rainmaker Securities’ Greg Martin.

Robinhood’s user growth, brand recognition and valuation appear to be stronger than ever as the online brokerage recovers from the GameStop trading chaos.

Demand for Robinhood shares in private markets is surging as the start-up likely benefited from headlines and mentions by politicians and celebrities. Robinhood added gained 3 million users last month alone, according to estimates from JMP Securities.

“From a brand recognition perspective, who doesn’t know who Robinhood is?” said Greg Martin, managing director and co-owner at Rainmaker Securities. “Despite some positive and negative press, everyone in the world knows who Robinhood is. They couldn’t have better free advertising.”

The company, which pioneered zero-commission trading, is still seen as the main gateway for young investors to access the markets. It is expected to go public later this year amid strong demand for fintech stocks such as Affirm, which had its IPO on Jan 13.

Bids for Robinhood’s pre-IPO shares spiked during the GameStop mania last month, according to Rainmaker, which provides financing for shares of private companies. Demand also rose after Robinhood CEO Vlad Tenev testified before Congress last week. It’s also the most bid-upon stock Rainmaker sees in the secondary market right now. The demand surge could be seen as a vote of confidence for Tenev as he navigated a public relations disaster.

These bids are not guaranteed, but they tend to be a good proxy for investor interest in companies at a certain price. One of the most recent bids for Robinhood shares came in at $52 per share — up from around $15 per share in September.

Private market valuations are often opaque. They are based on outside investments as a percentage of the company. They can also be hard to calculate without knowledge of a start-up’s assets and outstanding shares. But based on that pop in bid prices, one investor told CNBC that Robinhood’s valuation could be as high as $40 billion — more than triple its last publicly disclosed number.

“With the amount of capital they now have, I expect the company will be the dominant brokerage going forward, and I think the market will acknowledge that,” said Martin, who is also the founder of Liquid Stock. “The valuation could be very large in the very near future which bodes well for an IPO.”

Robinhood declined to comment on its IPO timing and valuation.

The Silicon Valley start-up found itself in the middle of a firestorm last month amid the short squeeze in GameStop, which was partially fueled by Reddit-driven retail investors. At the height of GameStop’s surge, the millennial-favored brokerage restricted trading of certain securities due to increased capital requirements from clearing houses.

Demand from Silicon Valley

Robinhood’s decision to restrict trading was met with outrage from traders online. Still, its private investors flocked to back the company. Some venture capitalists responsible for the $3.4 billion in emergency capital cited the app’s ability to add customers amid the trading turmoil.

Three of Robinhood’s private investors said there was “strong demand” to get a piece of the company, even as it stared down a public relations and regulatory crisis.

The financing came in the form of convertible debt, sources said. That debt will convert to equity when the brokerage goes public, and those investors will get a 30% discount on the market price. One venture capitalist told CNBC he and fellow investors believed the company would go public soon, and the debt round was a chance to “get in at a discount.”

JMP Securities analyst Devin Ryan estimates Robinhood’s total accounts are now closer to 23 million, including the 3 million gained in January and 10 million users added in 2020 as investing from home boomed during the pandemic.

Robinhood’s Tenev told Congress last week the company had delivered more than $35 billion in realized gains to investors, which implies big growth in customers and customer assets. Its average account size is about $5,000, the company said.

Tenev, who co-founded Robinhood eight years ago, answered questions from members of the House Financial Services Committee for more than five hours last Thursday. The Robinhood chief was tempered in his responses, and calmly explained that the billions in cash injections were needed to prevent a liquidity crisis from happening.

One investor, who asked not to be named because company strategy was private, said Tenev’s testimony “went well” despite being “painful to watch at times,” due to varying degrees of understanding of Robinhood’s business model from those in Washington.

“Robinhood emerged from this — there certainly was a hit on the company but we’re fully committed to working through that,” the investor said.

Another investor told CNBC that Robinhood backers “are feeling pretty good” about Tenev’s performance. After 48 hours of the GameStop saga, he said it was clear the Twitter backlash was “insular” as the company continued to add hundreds of thousands of new accounts that week.

“Growth has been great, despite Robinhood taking the brunt of press and questions from Congress —Vlad’s done a great job, and as good as he could have done given the situation,” he said. “He was sitting at the nexus of potentially pissing off regulators, customers and competitors.”

Some analysts say new regulation could hinder the legal, but controversial, practice of payment for order flow, hurting the IPO’s prospects. However, Robinhood investors say its value lies in user engagement, not the revenue model. Investors pointed to its position atop the Apple app store, even as it was restricting customers from trading certain stocks.

“It’s the fastest growing consumer app, and has better engagement than social media,” another investor told CNBC. “The majority of those new traders won’t be trading GameStop.”

Robinhood users ... investing in Robinhood?

Some critics, most notably Barstool CEO Dave Portnoy, believe Robinhood’s brand — built on democratizing investing — won’t survive the GameStop trading halts.

However, many expect retail demand for Robinhood’s offering to be strong, given it’s the vehicle that lets rookie investors access the stock market with little friction.

Robinhood could hit the public markets by way of a direct listing or through a special purpose acquisition company, people familiar with the private dealings told Bloomberg News. It has also reportedly considered allowing investors on its platform to invest directly in the Robinhood IPO.

Airbnb followed a similar playbook by offering shares to their hosts, and the stock more than doubled in public-market debut because of retail participation. Snowflake was another stock that surged on its first day of trading, which some speculate was due to much higher-than-expected retail demand for the name.

With a public debut in mind, Robinhood is now talking about the future of the investing boom it helped spark. Some analysts have floated the idea of Robinhood launching more banking products, or even mortgages, on the millennial-focused app.

The future may also involve more brokerage firms combining stock trading and social media into their platforms, Tenev told CNBC’s Andrew Ross Sorkin at the Dealbook DC Policy conference this week. Brokerage firms SoFi and Public already offer this feature.

As for what happened with GameStop, Tenev called it a “5-sigma” event — meaning it had about a 1 in 3.5 million chance of occurring. Robinhood should have enough capital now to deal with regulatory requirements associated with frenzied trading, he said.

But the GameStop volatility doesn’t seem to be going away. Investors poured back into the video game retailer on Wednesday, sending shares up more than 100% at one point.

— with reporting from CNBC’s Crystal Mercedes.

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From: The Ox2/28/2021 10:07:11 PM
   of 189
Any thoughts on MoneyLion - FUSE SPAC?

Another Fintech Is Going Public Through a Blank-Check Company, in a $2.9B Deal

Luisa Beltran

Feb. 12, 2021 5:47 pm ET

MoneyLion will have an enterprise value of $2.4 billion once its merger with a SPAC closes.
Courtesy of MoneyLion

MoneyLion is the latest fintech to go public through a blank-check company.

The digital financial platform said Friday it agreed to merge with Fusion Acquisition (ticker: FUSE), the special purpose acquisition vehicle that is chaired by James Ross, the former chairman of State Street Global Advisors’ global SPDR ETF business. MoneyLion will have an enterprise value of $2.4 billion once the deal closes, which is expected during the first half of the year. The transaction also includes a $250 million private investment from investors such as BlackRock (ticker: BLK) and Apollo Global Management (APO).

The equity value of MoneyLion jumps to $2.9 billion once $350 million from the SPAC and $250 million from the private investment are included, a statement said. MoneyLion will receive $526 million in net proceeds.

Fusion will be renamed MoneyLion and it will trade on the New York Stock Exchange once the merger is completed. News of the sale caused Fusion shares to shed more than 5%, or 63 cents, to close at $11.57 Friday.

Accessing capital markets “allows us to raise awareness of MoneyLion …to the 100 million plus Americans who are disadvantaged through the current financial system,” said Dee Choubey, MoneyLion CEO and co-founder, in an interview.

Launched in 2013, MoneyLion provides products to help consumers save, borrow money, and invest. Its mobile banking product, RoarMoney, lets members get paid up to two days early. The start-up has 7.5 million members. MoneyLion has raised $230 million in funding from investors, including venture-capital firms Edison Partners and Greenspring Associates. MoneyLion shareholders will own about 76% of the combined company once the sale to Fusion closes, the statement said.

The New York start-up will be looking to add more features and products including pay over time and a secured credit card, as well as a cryptocurrency platform that Choubey said will be “done in a safe way.” MoneyLion, which employs 300 people, will also seek to hire, adding 5% to 10% more staff in the short term, Choubey said.

The New York fintech generated $76 million of adjusted revenue in 2020, which it expects will jump to $144 million in adjusted revenue the following year, a statement said.

MoneyLion didn’t consider a sale but it did look at other methods of going public, including a traditional initial public offering and a direct listing, Choubey said. A SPAC is “an efficient way to become public,” he said.

Fusion Acquisition Corp. is the first blank-check company from Ross. Fusion went public in June, raising $350 million. Ron Suber, the former president of Prosper Marketplace and a noted fintech investor, introduced MoneyLion to Ross. Talks between the two parties began in July, Choubey said.

“MoneyLion is at the perfect high-growth inflection point that makes accessing public markets a logical next step,” said John James, founder and CEO of Fusion, in a statement. James is the co-founder and CEO of BetaSmartz.

MoneyLion is the latest fintech to sell to a SPAC. Payoneer is merging with noted fintech pioneer Betsy Cohen’s latest blank-check company in a $3.3 billion deal. In December, Paysafe said it was combining with a SPAC from William P. Foley II, a noted financial services investor, in a $9 billion deal.

Adi Jayaraman of Citi, Greg Phillips of Broadhaven, and Steve McLaughlin of FT Partners provided financial advice to MoneyLion. Davis Polk & Wardwell acted as legal advisor to MoneyLion. John Hall of J.P. Morgan Securities LLC served as financial advisor and lead placement agent to Fusion. Cantor Fitzgerald acted as capital markets advisor to Fusion and White & Case was the attorney Fusion. Citi, Cantor Fitzgerald and Odeon Capital Group also acted as co-placement agents on the PIPE.

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To: The Ox who wrote (159)2/28/2021 10:11:33 PM
From: The Ox
1 Recommendation   of 189
Why Is No One Talking About LendingClub Stock?

Once a hot IPO, LendingClub fell from grace. Hard. But a turnaround could be in the offing.
Billy Duberstein (TMFStoneOak) Feb 28, 2021 at 8:15AM

It's been a difficult six years for LendingClub ( NYSE:LC) as a public company. After coming to market in late 2014 as a new-age fintech platform at a $5.4 billion valuation, the company has since plunged to just a fraction of that, with a current market cap of only $850 million.

So, what happened to LendingClub? Things started going wrong in 2016, when its founder and former CEO, along with some executives, were caught doctoring some details on loan requirements in order to move more loans through its platform. LendingClub had set itself up as a peer-to-peer lender, with retail investors buying high-yield loans from borrowers. LendingCLub acted as a scaled "marketplace," offering investors diversified pools of parts of loans, while borrowers could get personal loans at lower rates than credit cards, since LendngClub didn't have any brick-and-mortar infrastructure.

The thing was, LendingClub was dependent on volume, and it seems the founder cut corners in pursuing growth. Not only that, but LendingClub's loans started to experience increased chargeoffs in 2016 as the economy slowed.

The stock has never recovered from the fallout, as the company was caught up in costly lawsuits and a business model retrenching ever since. New CEO Scott Sanborn has been transforming the business over the past few years, which may have soured the original investors in LendingClub, without attracting more traditional financial stock investors.

However, I think better days are ahead for LendingClub, which just closed a potentially transformative acquisition just on February 1 and could be on the brink of a big turnaround.


LendingClub was turning the corner prior to COVIDThings were actually looking pretty positive for LendingClub and its turnaround just before COVID hit. After the 2016 scandal, LendingClub slowed originations, and aimed more at prime borrowers with tightened underwriting. In addition, LendingClub sought out more stable institutional investors, such as banks, insurance companies, and other professional funds. This has helped stabilized the funding side of the platform, as these institutions are fine with lower yields in exchange for safer investments. They are also much less "flighty" than individual retail investors lured in by high yields. And the company has also innovated more products, including liquid, tradable securities made up of LendingClub loans on several different platforms, opening its loans up to more types of investors.

That slowed down LendingClub's growth, but was likely necessary. Any company involved in lending is always tempted to boost growth in the near-term, but making too many bad loans can come back to bite you in the long-term, as LendingClub painfully learned.

Still, LendingClub did, prudently and methodically, increase originations between 2017 and 2019, from $9 billion in originations in 2017 to $12.3 billion in 2019. Margins also increased, due to both scale and management efforts to cut costs. The company even reach adjusted net income profitability for the first time in years in the third quarter of 2019. Even after it slowed down originations, LendingClub was still the largest originator of personal loans in the U.S.

Covid-19 cons and prosFor sure, the COVID-19 downturn wasn't great for any financial company. At the onset of the pandemic, the company immediately pulled back on lending, cutting originations by 87% quarter-over-quarter in Q2, then slowly increasing in Q3, with another expected increase in Q4. Still, originations and revenues will still be down a lot from the prior year. Obviously, LendingClub's adjusted net margins went negative this year once again.

However, there are some silver linings. The company has continued to cut costs, and its loans made pre-pandemic are holding up well. LendingClub expects that pre-COVID loan vintages are still averaging 4% returns, which is not too far below their original expected return. And post-COVID loans are forecast to return between 5%-6%. Investors are also returning to the platform after a justified hiatus after COVID broke out, increasing loan buys in Q3 and Q4.

One of the fears around LendingClub was how its loans would hold up in a financial downturn. So far, so good.

Radius could be a game-changerLendingClub's stock is just making its way back to pre-COVID levels, but the recent closing of the Radius Bank acquisition on February 1 could change the story. Radius is a digital-only bank headquartered in Boston. At the time of the announced acquisition just before COVID, Radius had $1.4 billion in assets and $1.2 billion in deposits.

At first glance, it appears that LendingClub paid a somewhat expensive price for Radius, buying it for $185 million, equal to 1.72 times book value and 28.6 times 2019 earnings. However, that's only the beginning of the story.

LendingClub is also set to reap some $40 million in annual cost synergies from the deal, including lower regulatory costs (from having an in-house bank), as well as lower funding costs from deposits. Remember, LendingClub wasn't a bank prior to this, and had to fund a lot of its loans in the short-term with higher-cost warehouse lines.

Not only will the company reap those cost synergies, but LendingClub will also be able to hold more loans on its balance sheet against its deposits, keeping the extra economics for itself. Of course, LendingClub will still be a marketplace, but the ability to hold more loans itself if need be will take care of the funding vulnerability in rough times, and should lead to an extra $40 million in profit for every $1 billion held on its books.

If you add that on, that's potentially an additional $80 million pre-tax income LendingClub can make as a result of the acquisition. If these benefits are achieved, LendingClub is really only paying two times pre-tax earnings for Radius. Quite a steal!

Call it a comeback?As the economy recovers from COVID, there's a pretty good shot that we could enter a strong period of GDP growth, which should benefit financial stocks. When you consider LendingClub's stock is still quite depressed from several years ago, even while the business has been transformed with a much better cost structure coming out of the crisis, and LendingClub looks like a compelling turnaround story for value investors to explore. The company reports fourth quarter results on March 10.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

Billy Duberstein owns shares of LendingClub. His clients may own shares of the companies mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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From: Glenn Petersen3/2/2021 6:47:06 AM
2 Recommendations   of 189
Square’s bank arm launches as fintech aims ‘to operate more nimbly’

Mary Ann Azevedo 19 hours
March 1, 2021

Known for its innovations in the payments sector, Square is now officially a bank.

Nearly one year after receiving conditional approval, Square said Monday afternoon that its industrial bank, Square Financial Services, has begun operations. Square Financial Services completed the charter approval process with the FDIC and Utah Department of Financial Institutions, meaning it’s ready for business.

The bank, which is headquartered in Salt Lake City, Utah, will offer business loan and deposit products, starting with underwriting, and originating business loans for Square Capital’s existing lending product.

Historically, Square has been known for its card reader and point-of-sale payment system, used largely by small businesses — but it has also begun facilitating credit for the entrepreneurs and smalls businesses that have used its products in recent years.

Moving forward, Square said its bank will be the “primary provider of financing for Square sellers across the U.S.”

In a statement, Square CFO and executive chairman for Square Financial Services Amrita Ahuja said that bringing banking capability in house will allow the fintech to “operate more nimbly.”

Square Financial Services will continue to sell loans to third-party investors and limit balance sheet exposure. The company said it does not expect the bank to have a material impact on its consolidated balance sheet, total net revenue, gross profit or adjusted EBITDA in 2021.

Opening the bank “deepens Square’s unique ability to expand access to loans and banking tools to underserved populations,” the company said.

Lewis Goodwin had been tapped to serve as the bank’s CEO, and Brandon Soto its CFO. With today’s announcement, Square also announced the following new appointments:

Sharad Bhasker, Chief Risk Officer
Samantha Ku, Chief Operating Officer
Homam Maalouf, Chief Credit Officer
David Grodsky, Chief Compliance Officer
Jessica Jiang, Capital Markets and Investor Relations
The fast-growing company, which sells a credit card tailored for startups, with Emigrant Bank currently acting as the issuer, said that it had submitted an application with the Federal Deposit Insurance Corporation (FDIC) and the Utah Department of Financial Institutions (UDFI) to establish Brex Bank.

A number of fintech companies, or those with fintech services, have spun up products typically offered by banks, including deposit and checking accounts as well as credit offerings. Often, these are designed to provide capital to customers who might not be able to get funding on favorable terms from traditional banking institutions, but who might qualify for business-building loans from a provider who knows their company, like Square, inside and out.

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From: DJK13/5/2021 9:56:47 AM
   of 189
Timios Announces Expansion of Its Retail Purchasing Business

Timios is a Fintech PropTech positive cash flow asset (100%) of Ideanomics Inc.

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From: Glenn Petersen3/14/2021 8:38:20 PM
   of 189
Stripe closes $600M round at a $95B valuation

Ingrid Lunden @ingridlunden
4:59 PM CDT•March 14, 2021

On the heels of reports that Stripe was raising yet more money, the payments giant has now confirmed the details. The company has closed in on another $600 million, at a valuation of $95 billion.

Stripe said it will use the funding to expand its business in Europe, with a focus on its European HQ, and also to beef up its global payments and treasury network.

“We’re investing a ton more in Europe this year, particularly in Ireland,” said John Collison, President and co-founder of Stripe, in a statement. “Whether in fintech, mobility, retail or SaaS, the growth opportunity for the European digital economy is immense.”

Stripe said the financing included backing from two major insurance players. Allianz, via its Allianz X fund, and Axa are in the round, along with Baillie Gifford, Fidelity Management & Research Company, Sequoia Capital, and an investor from the founders’ home country, Ireland’s National Treasury Management Agency (NTMA).

The insurance angle may point to which direction the company is looking to go next. After all, fintech and insurance are closely aligned.

“Stripe is an accelerator of global economic growth and a leader in sustainable finance. We are convinced that, despite making great progress over the last 10 years, most of Stripe’s success is yet to come” said Conor O’Kelly, CEO of NTMA in a statement. “We’re delighted to back Ireland’s and Europe’s most prominent success story, and, in doing so, to help millions of other ambitious companies become more competitive in the global economy.”

The big round, rising valuation, and growing cap table will inevitably lead to questions around where the company is standing with regards to its next steps, and whether that will include a public listing. Stripe has long kept its cards to its chest when it comes to user numbers, revenues, and profit and those details, once again, are not being disclosed with the news today, and nor has it made any comments on IPO plans.

Notably, the confirmation of the news today is at a lower valuation than the valuation Stripe was reportedly trading at on the secondary market, which was $115 billion; and the round that closed at a $95 billion valuation was also rumored to be coming in at a higher number, over $100 billion.

It’s not clear whether those numbers were never accurate, or if Covid had an impact on pricing, or if European investors simply drove a hard bargain.

The focus on growing in Europe also puts the hiring of Peter Barron — the former EMEA VP of communications for Google and a former journalist — into some context.

Founded in 2010 by John and his brother Patrick Collison (the CEO), Stripe is one of a wave of commerce startups that saw the value of building a simple way for developers to integrate payments into any app or site by way of a few lines of code, at a time when digital and specifically online payments were starting to take off.

Behind that code, the company had done all the hard work of integrating all the different and complex pieces needed to make payments work both in countries and across borders. Over the years, the company has built out a bigger platform around that, a suite of services to position itself as a one-stop shop not just for helping businesses run all of the commercial aspects of their operations, including incorporation, managing fraud, managing cashflow and more.

Within that, Stripe has built out a decent footprint in Europe, with the region accounting for 31 of the 42 countries where it has customers today. While Stripe may have had its start and early traction providing payments infrastructure for startups (and especially small, new startups), today that list includes a lot of big names, too. In Europe, customers include Axel Springer, Jaguar Land Rover, Maersk, Metro, Mountain Warehouse and Waitrose, alongside Deliveroo (UK), Doctolib (France), Glofox (Ireland), Klarna (Sweden), ManoMano (France), N26 (Germany), UiPath (Romania) and Vinted (Lithuania).

Even with heavy competition in payments and adjacent services, there is a huge opportunity for more growth. Stripe says that in the wake of Covid and the rise of people shopping considerably more across the web and apps rather than in person, currently some 14% of commerce happens online, a big shift considering that just a year ago it was about 10%.

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To: The Ox who wrote (159)3/21/2021 4:27:59 PM
From: Glenn Petersen
1 Recommendation   of 189
FUSE has drifted down to $10.18.

MoneyLion investor presentation:

Phenomenal growth, with a broad range of services targeting the next generation of investors (or should I say speculators?). Also, it is not losing a ton of money. Probably a bit ahead of itself valuation-wise, but that comes with the territory with today's SPAC transactions. It will probably do well after the close of the transaction and get a sympathetic bounce when Robinhood goes public.

Another one to keep an eye on is the eToro/FTCV transaction.

Blank Check IPOs (SPACS) Message Board - Msg: 33243660 (

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From: Glenn Petersen3/23/2021 4:57:31 PM
   of 189
Robinhood Is Said to Have Filed Confidentially for U.S. IPO

By Matthew Monks and Katie Roof
March 23, 2021, 3:07 PM CDT

Robinhood Markets Inc., the popular trading app, has filed confidentially for an initial public offering with the U.S. Securities and Exchange Commission, according to people familiar with the matter.

Robinhood is moving forward with its IPO although its listing plans could change, said the people, who asked to not be identified because the matter isn’t public.

Bloomberg News previously reported that Robinhood was planning to file for an IPO this month. The company has selected Nasdaq as the venue for its listing, people familiar with the matter have said.

A representative for Robinhood, based in Menlo Park, California, declined to comment.

Robinhood became immensely popular during the coronavirus pandemic, particularly as homebound young people turned to online trading to pass the time and make money.

That increased popularity has led to scrutiny from politicians and regulators, who are focused on the so-called gamification of trading and the company’s role at the center of the meme-stock frenzy. Robinhood also had to raise billions of dollars from its backers to comply with a request from the industry’s clearinghouse.

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To: The Ox who wrote (160)3/28/2021 7:57:30 PM
From: Glenn Petersen
   of 189
A well laid out case on behalf of LendingClub. LC is up substantially since you posted that article.

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