Robinhood Joins Goldman and Morgan Stanley at IPO Table

Robinhood appears on the tombstone for fitness ring maker Oura's IPO as the 18th of 18 underwriters — listed alongside Goldman Sachs, Morgan Stanley and J.P. Morgan. The placement marks the trading app's debut as an IPO underwriter, and it signals that retail investors have moved from afterthought to participant in the capital markets process.

Oura postponed its offering suddenly on Tuesday, an interruption that Fortune's Allie had described this month as the year's hottest imminent IPO. But the delay does nothing to undercut the significance of Robinhood's role, Fortune finance editor Jeff John Roberts writes. Robinhood's seat at the table is the latest milestone in an accelerating five-year trend: retail investors taking on a major role in capital markets.

The trend took off in 2020, when pandemic lockdowns pushed young people to spend stimulus checks on stocks. That era produced the GameStop short squeeze and investing celebrities like Roaring Kitty. Wall Street initially dismissed the retail crowd — whose picks included bankrupt Hertz and Bed Bath & Beyond — as fools who would soon disappear. They didn't. Retail investors have grown more powerful and more sophisticated, a shift reflected in this year's SpaceX IPO, where the retail allotment exceeded 20%.

That growing clout led Wall Street to take retail seriously, including granting Robinhood an underwriter role. The position gives Robinhood a say in the IPO process and a cut of the fees — albeit a very small one. This differs from past IPOs, where retail brokerages received a tranche of shares to distribute but played an entirely passive role.

Retail brokerages have pushed for their customers to get first dibs on IPO stocks rather than buy shares at a premium from the connected clients of big banks. Companies going public are also coming to value retail holders beyond simply filling out the order book. Scott Coyle, CEO of Click Capital Markets, says executives now view retail investors as a source of stability: unlike institutional investors, who rely on algorithms to dump underperforming shares at the first sign of trouble, retail buyers are more likely to stick around in good times and bad. Coyle adds that CEOs of customer-facing companies, including the head of Jersey Mike's, see retail buyers as a way to deepen brand loyalty.

For Oura's part, the delay left questions. The company offered an unsatisfying explanation, claiming it foresaw "strong demand" but decided to wait due to "uncertainty in the IPO market." Some market watchers asked whether investors soured because Oura treated the offering primarily as a chance to unload secondary shares rather than raise capital. Others pointed to a tougher climate driven by higher interest rates and broader uncertainty as the market awaits the next two mega-offerings — OpenAI and Anthropic. The answer should arrive soon enough.

Deal Flow

Venture capital. EliseAI, a New York-based AI company automating housing and healthcare operations, raised $350 million from a16z and Bessemer Venture Partners, with Ontario Teachers' Pension Plan, Sapphire Ventures and Navitas Capital joining. Jeeves, a Miami-based stablecoin-native banking platform, raised $110 million led by CoinFund, with AllianceBernstein, Vista Equity Partners, Coinbase Ventures, a16z and Y Combinator participating. Ai3Bio, a Watertown, Mass.-based autoimmune therapy developer, raised $48 million in Series A funding led by UPMC Enterprises and Ziff Capital Partners. Aptadir Therapeutics of Milan raised €40 million ($45 million) in seed funding led by 4BIO Capital. Ascerta raised $18 million in Series A funding led by Dell Technologies Capital. NG.Cash, a São Paulo payments app for young people, raised $15 million led by Blockchain Capital, and Proximal AI, a coding-data research lab, raised $15 million in seed funding led by General Catalyst. RemoteThreat raised $7 million in pre-seed funding from Osage University Partners and DataTribe. London soda brand Something & Nothing raised $6.4 million led by Venrex. Elio Mortgage raised $5.1 million in pre-seed funding from Motive Partners and Social Leverage. Champion, an Indianapolis AI sales coaching platform, raised $5 million led by Armory Square Ventures.

Private equity. TJP, a portfolio company of Renovus Capital Partners, acquired Exton, Pa.-based life sciences market research firm Evolution Consulting & Research. Terms were not disclosed.

Exits. Capitolis agreed to acquire eSecLending, a Boston-based securities lending business, from Parthenon Capital in a transaction valued at $200 million.

Funds. Princeton Equity Group raised $1.3 billion for its third fund targeting franchisor and multi-location businesses. Protego Ventures, a Tel Aviv venture firm, raised $125 million for its first fund focused on early-stage Israeli defense companies.