Robinhood Markets announced Tuesday that it entered into an agreement to acquire TradePMR, a custodial and portfolio management platform for RIAs, for about $300 million in a combination of cash and stock. The acquisition is expected to close in the first half of 2025.
TradePMR, which has more than 25 years in the industry and over $40 billion in assets under administration (AUA), will “enhance Robinhood’s offering for customers by delivering a top-ranked RIA custody and portfolio management platform that connects financial advisors to a new generation of investors,” Robinhood said in a press release. The purchase will accelerate Robinhood’s delivery of investment advisory capabilities to customers, the firm said.
“The needs of Robinhood customers are evolving and they are seeking advice on how to build and manage their growing portfolios,” according to the firm, which noted the RIA market is a $7 trillion industry and among the fastest-growing wealth management sectors.
“The total investable assets held by millennials is expected to increase over the next two decades with an estimated $84 trillion wealth transfer on the horizon,” Robinhood said.
Robinhood has over 24 million funded client accounts, about 75% of which are Gen Zers and millennials.
“The strategic acquisition brings together two mission-aligned companies as Robinhood enters the wealth management space, combining the skills of fiduciary advisors with Robinhood’s cutting-edge technology,” the company said.
According to the news release, the combined firms plan to build a referral program, and TradePMR’s RIAs will be able to access a new client base via Robinhood. They also intend to enhance their technology platform to make it easier for RIAs to reach Robinhood clients and grow their businesses.
With its Fusion open architecture platform, TradePMR “provides what we believe to be an ideal match as Robinhood looks to build a seamless, cutting-edge advisory experience that enables more people to build wealth and access wealth management services,” according to Robinhood.
Robinhood is looking to build a platform for advisors and clients to view their managed assets inside Robinhood’s app, alongside their self-directed investments, the firm said.
TradePMR has a long-standing partnership with Wells Fargo Clearing Services, which Robinhood and TradePMR plan to preserve and deepen to help ensure “business continuity and minimal disruption for TradePMR’s RIAs and their clients,” Robinhood said.
“The TradePMR team has one of the strongest RIA networks in the industry,” said Vlad Tenev, CEO and Chairman of Robinhood. “We’re excited to join forces to build a category defining advisory platform for the next generation.”
“For many years, the advisor industry has discussed the issue of losing customers when assets transition to a spouse or to heirs,” said Robb Baldwin, CEO and Founder of TradePMR.
“Robinhood’s client base is the next generation of investors,” Baldwin said. “We believe this acquisition allows us to build a multi-generational platform that will help introduce financial advisors to this next generation.”
“Both Robinhood and TradePMR are committed to maintaining transparency throughout this process,” according to a news release.
Citi served as exclusive financial advisor to Robinhood for the transaction, while Lazard served as exclusive financial advisor to TradePMR.
Jeff Berman, Contributing Editor and Reporter at Wealth Solutions Report, can be reached at jberman@wealthsolutionsreport.com.
