India American Baiju Bhatt founder of Robinhood sells $9.23 million in stock

NEW YORK (TIP): The new year began differently for Baiju Bhatt than most, by earning close to $10 million. Bhatt reportedly sold 228,645 shares of Robinhood’s Class A stock for $9.23 million under a pre-arranged Rule 10b5-1 trading plan, according to Investing.com.
The shares sold on Jan. 3 at an average price of $40.37 with a 226% surge in stock value over the past year. Bhatt’s Living Trust, which executed the sale, now holds no Class A shares but retains significant Class B holdings.
Robinhood Markets, founded in 2013 by Bhatt and Vladimir Tenev, is a financial services company that has simplified online trading with its commission-free platform. The company’s user-friendly interface, cryptocurrency trading, and innovative features like fractional shares have made investing accessible to millions. However, recent developments have brought its co-founder Bhatt and the company into the spotlight.
This transaction coincides with Robinhood’s impressive financial milestones. In Q3 2024, the company reported a 36% revenue increase, totaling $637 million. Analysts have noted Robinhood’s growth prospects, with upgrades from major firms like JPMorgan and Barclays citing strong earnings and expansion into cryptocurrency and derivatives markets.
Amid this success, Robinhood faces regulatory challenges. The U.S. Securities and Exchange Commission (SEC) recently fined the firm $45 million for recordkeeping and reporting violations. The SEC found that Robinhood failed to retain trading data and address cybersecurity risks. General Counsel Lucas Moskowitz expressed satisfaction in resolving the matter, emphasizing the company’s commitment to innovation and compliance.
“We are well-positioned to continue leading the industry in developing the innovative products and services our customers want and need,” said Moskowitz, according to Reuters. “We look forward to working with the SEC under a new administration.”
After earning his B.A. in physics, Bhatt stayed at Stanford to earn his master’s in mathematics as well. It was then he and Tenev became classmates and roommates.
Bhatt and Tenev started two companies in New York together before they launched Robinhood, an idea that was inspired by the Occupy Wall Street movement in New York. The two friends decided to make their app free, letting people trade stocks without any fees.
Bhatt stepped down from his position as the company’s CEO in November 2020, leaving Tenev as the single CEO of the company. The change in leadership was a move made so that Bhatt could direct his attention more to product development, according to Forbes.