Investment Platform eToro Plans To Go Public, Expects $10.4 Billion Valuation

Online multi-asset investment platform eToro is set to go public through a blank-check company. In a press release, eToro said that it expects a valuation of $10.4 billion.

The company said it will go public through a business combination with a special purpose acquisition company. The SPAC, FinTech Acquisition Corp. V., is a publicly-traded corporation on the Nasdaq (FTCV). A SPAC has no commercial operations, but is formed to raise cash and go shopping for a company such as eToro.

“In the last few years, eToro has solidified its position as the leading online social trading platform outside the U.S., outlined its plans for the U.S. market and diversified its income streams,” said Betsy Cohen, chairman of FinTech V. “We believe eToro is exceptionally positioned to capitalize” on the opportunity for growth.

When the acquisition closes, “the combined company will operate as eToro Group Ltd. and is expected to be listed on Nasdaq,” the release said. The deal is backed by SoftBank, among other companies.

“In 2020, eToro added over five million new registered users and generated gross revenues of $605 million,” the release said, adding that the company “added over 1.2 million new registered users and executed more than 75 million trades in January 2021 alone.” The deal “includes commitments for a $650 million common share private placement from leading investors including ION Investment Group, SoftBank Vision Fund 2, Third Point LLC, Fidelity Management & Research Co. LLC, and Wellington Management.”

Founded in 2007, eToro has benefited from the boom in online trading. The company said that “users can trade directly themselves … or replicate the investment strategy of successful investors on the platform at no extra cost with the simple click of a button.” In addition, users can pick from a selection of stocks, currencies, commodities, cryptocurrencies and ETFs, or exchange-traded funds.

In 2019, eToro acquired a cryptocurrency portfolio app, Delta, in a deal reportedly worth $5 million. Yoni Assia, co-founder and CEO of eToro, said in a press release at the time that the acquisition reflected the company’s “commitment to continued growth and innovation.”