Robinhood is just one hot fintech IPO expected this year

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Robinhood, the app-based trading platform, looks set to hit the public markets this year after filing confidential paperwork with the Securities and Exchange Commission this week.

It has been among the most talked about firms on Wall Street as retail investing has grown in popularity amid the pandemic, and more recently, as Reddit-fueled investors used the platform to buy up heavily shorted stocks like GameStop (GME).

But Robinhood is far from the only financial technology, or fintech, startup expected to make its public debut this year. From Betterment and Chime to Coinbase and BlockFi, the IPO market for fintech companies still has plenty to offer in 2021, though their valuations may be slashed, according to Kathleen Smith, IPO ETF manager at Renaissance Capital (IPO). Shares of the Renaissance IPO Index are negative so far in 2021, though handily outperformed all major indices over the last 12 months.

"The IPO market is starting to get weighed under by the amount of issuance that we've seen, and the multiples so there's like a valuation reset happening in the IPO market," she told Yahoo Finance.

Coinbase

Coinbase is the largest cryptocurrency exchange in the U.S., with a valuation of $68 billion. The company filed an S-1 with the SEC last month ahead of its expected direct listing. The timing couldn’t be better for Coinbase, as it reported total 2020 revenue of $1.3 billion with net income of $322.3 million.

"All these [cryptocurrency] exchanges and brokers have traded really well,” Smith told Yahoo Finance. “And I think that with Coinbase, it's one of the few plays on...the growth of crypto, because you can't really buy right now a bitcoin ETF or anything else like that.”

Getting access to a cryptocurrency exchange also gives investors the ability to play in the crypto space without having to be completely exposed to the frequent swings in cryptocurrency values.

Better.com

Better.com, which has a valuation of $4 billion, is an online mortgage lender that eschews the brick-and-mortar setups of traditional lenders. It’s more akin to something like Rocket Mortgage, whose parent company Rocket Companies (RKT) went public in August 2020, raising $1.8 billion at a valuation of $36 billion.

Better.com’s selling point is that it doesn’t hit users over the head with fees, charging nothing for your application, underwriting your loan, and loan origination. The firm also promises 24/7 support including on weekends, doesn’t charge commission on loans, and provides loan estimates right away, with users able to get pre-approved in three minutes.