Crying Out! Robinhood’s IPO Blind Box Game Results in Retail Investors Receiving Only 1 Share of Figma
Seeing Others Make Money is Harder than Losing Your Own
Missing out on Figma’s IPO can be disheartening. A Benzinga contributor purchased 1,000 shares through Robinhood before the Figma IPO, thinking they were one step closer to early retirement, only to be left disappointed.
On July 31, design collaboration platform Figma Inc. (NYSE: FIG) officially listed on the New York Stock Exchange, quickly becoming the center of attention in the tech industry. This company not only delights designers but is also cherished by cloud giants like Google and Airbnb. In 2022, Adobe was willing to shell out $20 billion to acquire this UI/UX design startup, but was ultimately turned down by regulators. Since then, Figma’s valuation has skyrocketed, making the Figma IPO a highly anticipated event from Wall Street to Silicon Valley.
Figma’s debut did not disappoint: it opened at $85, more than double its offering price of $33, soaring to heights that left many questioning reality, with a market cap that briefly surpassed $55 billion. By Friday (August 15), FIG closed at $79, and investors were chuckling, but this contributor was left with only one share to admire. What happened?
Robinhood Gives Retail Investors a Chance to Participate in IPOs
In the past, it was nearly impossible for retail investors to participate in IPOs as the major Wall Street banks had a firm grip on the market. Most people barely had time to blink before stocks were snatched up. However, in 2021, Robinhood launched the IPO Access Program, changing the game and allowing ordinary retail investors the opportunity to purchase shares before they went public. Benzinga’s author Tom Gentile saw Figma appear on the IPO page and immediately clicked the subscription button with the swiftness of securing BlackPink concert tickets, quickly submitting an order to buy 1,000 shares at a maximum price of $33 per share, with $33,000 cash ready to enter the market.
Emotions Like a Roller Coaster on IPO Day
Tom Gentile received an email from Robinhood confirming his commitment to invest $33,000 in Figma, with charges only applied after he received stock allocation. On IPO day, FIG opened at $85 and skyrocketed, doubling its price. Tom Gentile was secretly thrilled, calculating that buying 1,000 shares would yield over $80,000! At that moment, he had not yet seen the second email from Robinhood. When he finally opened it, he was greeted with a heartbreaking message: “Your request to purchase 1,000 shares of FIG has been partially fulfilled. Congratulations, you have received one share of FIG stock at a transaction price of $33.”
Robinhood’s Lottery-Like Experience for Retail Investors
This is not a mistake, nor a copy error, nor a test email; Tom Gentile indeed received only one share. Prepared to invest $33,000, he was met with the cruel reality of being mocked by fate, as this IPO felt more like a large lottery event where he received only a consolation prize.
The Harsh Truth: Having a Ticket Doesn’t Guarantee Entry
Robinhood employs a Random Allocation Process, giving retail investors a chance to participate fairly. However, it’s akin to playing a capsule toy machine; spending money doesn’t guarantee obtaining the highest-value rare item. Many investors lamented on Reddit, having received nothing at all. Furthermore, don’t think you can immediately cash out that one precious share—Robinhood has a jump ship clause that freezes accounts for 60 days if you sell IPO allocation shares within 30 days.
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