Robinhood has announced a substantial acquisition, agreeing to a deal worth $300 million in cash and stock to purchase TradePMR, a platform specializing in custodial and portfolio management services.
This strategic acquisition allows Robinhood to enhance its diversification strategy, positioning itself more competitively against traditional brokerages like Charles Schwab. With over $40 billion in assets under administration, TradePMR serves an evolving clientele that is increasingly seeking guidance on portfolio management.
The partnership is expected to facilitate connections between Robinhood’s users and Registered Investment Advisors (RIAs), tapping into a $7 trillion industry that is rapidly growing within the wealth management sector. By leveraging TradePMR’s resources, both companies aim to enhance their technology platforms, thereby simplifying the process for RIAs to engage with Robinhood’s user base.
Robinhood CEO Vlad Tenev expressed enthusiasm for the collaboration, stating they aim to create a groundbreaking advisory platform tailored for a new generation of investors. TradePMR CEO Robb Baldwin echoed this sentiment, highlighting the opportunity to develop a multi-generational platform that bridges financial advisors with younger investors.
The acquisition is expected to finalize in the first half of 2025, contingent upon standard closing conditions, including approval from regulatory bodies. This deal marks Robinhood’s second significant acquisition this year, following its $200 million cash purchase of the crypto exchange Bitstamp, as the company seeks to expand its international presence and enhance its digital asset offerings. Additionally, Robinhood has recently introduced a credit card and expanded its trading options to include futures and index products.