Robinhood has acquired bank card firm X1 for $95 million.
X1 launched an in-app inventory buying functionality late final yr.
Robinhood CEO and co-founder Vlad Tenev stated that the acquisition will deliver his firm nearer to serving everything of consumers’ crucial monetary wants.
Inventory brokerage app Robinhood signed an settlement this week to accumulate six-year-old bank card startup X1. The deal is predicted to shut within the third quarter of this yr for $95 million in money.
Previous to the acquisition, X1 had raised $62 million. The corporate, which was based in 2017 by Deepak Rao and Siddharth Batra, refers to its bank card as “the neatest card ever made.” The no-fee Visa bank card has many options that prospects have come to count on of a contemporary card. It affords aggressive rewards, immediate fee notifications through a tandem cell app, a digital card quantity, and it permits prospects to show the cardboard on and off inside the app.
There are a handful of options that set the cardboard aside, nonetheless. The primary is the bodily card itself– it’s made from 17 grams of stainless-steel. The cardboard additionally permits customers to create a single-use card quantity that’s robotically cancelled after one use, which may come in useful for subscriptions customers don’t need to neglect to cancel. Customers may also create a card quantity without spending a dime trials that’s cancelled after 24 hours.
Robinhood CEO and co-founder Vlad Tenev defined the reasoning behind right this moment’s purchase. “This acquisition will deliver us nearer in direction of our purpose of serving everything of our prospects’ crucial monetary wants. Along with X1, Robinhood will now have the ability to provide our prospects entry to credit score,” he stated.
The acquisition aligns with X1’s route, as nicely. The corporate launched an in-app inventory buying functionality that allows cardholders to purchase shares within the X1 app utilizing their rewards factors. X1 guides buyers by recommending shares based mostly on the cardholder’s spending habits, threat preferences, funding targets, revenue, and time horizon.
Logistically the X1 workforce will be part of the Robinhood workforce. Rao and Batra will oversee Robinhood’s new card enterprise. Rao will function GM of Credit score Playing cards and can report back to Tenev.
