On Tuesday, American financial services company Robinhood said it will be acquiring London-based Zigu, an acquisition that’ll help the company launch in the UK two years after it halted plans to do so.
Ziglu is a fintech app that provides cryptocurrency capabilities such as allowing people to buy and sell cryptocurrencies. Robinhood says its acquisition of Ziglu will help it expand into the UK as well as Europe. It was founded in 2018 and has raised a total of £17.5 million ($22.8 million) to date, including £13.4 million from retail investors through the equity crowdfunding platform Seedrs. The company was last valued at £85 million.
Two years ago, when Robinhood halted its plans to venture into the UK it said that was doing so because it was placing its business operations over an international expansion.
Acquiring Ziglu would go a long way in boosting the company’s operations as well as its numbers which have seen a decline following a drop in the trading hysteria that characterized last year. In the fourth quarter of 2021, the platform’s monthly active users dropped from 18.9 million in the third quarter to 17.3 million. It also issued guidance for first-quarter revenue for 2022 at less than $340 million. The figure is down 35 percent from the same period in the previous year.
It is also pertinent to know that the company’s market value has also dropped by more than half from when it debuted on the NASDAQ. Ziglu’s acquisition will, therefore, “help us accelerate our global expansion efforts,” Vlad Tenev, Robinhood’s CEO and co-founder said.
In a blog post published today, he also mentioned that “Ziglu’s impressive team of deeply experienced financial services and crypto experts will help us accelerate our global expansion efforts. Together with the Ziglu team, we’ll work to leverage the best of both companies, exploring new ways to innovate and break down barriers for customers across the UK and Europe.”
The terms of the deal were not disclosed by both companies. The deal is, however, subject to regulatory approval.
Ziglu’s CEO Mark Hipperson says that both Ziglu and Robinhood share common goals adding that “As part of Robinhood, we’ll supercharge Robinhood’s expansion across Europe and bring better access to crypto and its benefits to millions more customers.”
Shares of Robinhood were up more than 3% Tuesday.