Robinhood brings AI to its customers with Pluto Capital acquisition

By Gordon Gottsegen

Pluto's AI models can help provide customers with things like tailored investment strategies

Robinhood Markets, a popular brokerage among retail investors, appears to be embracing the artificial-intelligence craze.

On Monday, Robinhood (HOOD) announced its acquisition of Pluto Capital, an investment-research platform that uses AI to offer tailored investment strategies.

Robinhood's stock opened about 0.80% higher on Monday around the time of the announcement but quickly slid. At the same time, Robinhood reported that its platform was experiencing service interruptions that affected some users.

Robinhood didn't disclose how much it paid for Pluto Capital.

Robinhood said that it would also bring Pluto Capital's chief executive and founder, Jacob Sansbury, on board to help the company integrate AI features into the Robinhood platform.

Robinhood highlighted some of the AI-powered offerings that Pluto's platform provides, including individualized investment strategies based on a user's historical behavior and risk tolerance, real-time updates and financial data analytics based on Pluto's language-learning models. Because Sansbury will be helping with its product road map, Robinhood may add similar features.

"Robinhood is the ideal destination to build products that democratize access to financial services like wealth management and financial planning through state of the art AI," Sansbury said in a statement.

Like many other tech companies, Robinhood has a history of using acquisitions to add more features to its product offerings. Robinhood acquired credit-card startup X1 in 2023, then announced its own Robinhood Gold credit card a few months later. The company acquired data-visualization company Chartr to integrate into its media company, Sherwood Media. Recently, Robinhood also acquired cryptocurrency company Bitstamp for $200 million.

-Gordon Gottsegen

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07-01-24 1044ET

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