SoFi, the operator of one of the most popular banking apps, today announced plans to go public through a SPAC merger at a valuation of $ 8.65 billion.

A PSPC merger is a type of agreement in which a company teams up with an investor or group of investors to help it go public. Investors create a so-called ad hoc acquisition company and list its shares on the stock exchange through an initial public offering. Then the company looking to go public merges with SPAC, which is faster than a traditional IPO and may have some other benefits.

SoFi, officially Social Finance Inc., is heading into the stock market after nearly a decade as a private company. Meanwhile, SoFi has established itself as one of the biggest players in the FinTech or FinTech market with a consumer banking app that provides access to services like student loan refinancing and mortgages. The startup has more than 1.8 million members.

The SPAC that SoFi plans to merge with, Social Capital Hedosophia V, is backed by Chamath Palihapitiya, a prominent venture capitalist and former head of Facebook Inc .. SoFi expects gross proceeds of up to $ 2.4 billion. Coatue Management, Altimeter Capital Management and other institutional investors participate in the fundraising.

The $ 2.4 billion SoFi is set to raise is in addition to the more than $ 2 billion in venture capital funds the company has raised since its launch. The $ 8.65 billion post-currency valuation he is expected to receive, in turn, would represent a significant premium over his last reported private valuation of $ 5.7 billion.

“The new investments and our partnership with Social Capital Hedosophia signify confidence in our strategy, the dynamics of our business, as well as the significant growth opportunity that lies ahead,” said Anthony Noto (photo) in a statement. declaration.

SoFi is experiencing rapid revenue growth. The company estimates that it will close 2021 with net sales of $ 1 billion, which would be an increase of about 60% from last year, and it hopes to achieve profitability excluding interest, taxes, depreciation and amortization.

SoFi is expanding to more segments of the fintech market in an effort to maintain its sales momentum. Last year the company signed a $ 1.2 billion deal to acquire Galileo, which provides cloud services that help financial companies with tasks such as managing members’ credit card numbers. The acquisition aims to expand SoFi’s business beyond consumer banking to support the operations of other fintech companies.

Photo: SoFi

Since you are here …

Show your support for our mission with our one-click subscription to our YouTube channel (below). The more subscribers we have, the more YouTube will bring you relevant content on emerging companies and technologies. Thank you!

Support our mission: >>>>>> SIGN UP NOW >>>>>> to our YouTube channel.

… We would also like to tell you about our mission and how you can help us fulfill it. SiliconANGLE Media Inc.’s business model is based on the intrinsic value of content, not advertising. Unlike many online publications, we don’t have a paywall or banner ad because we want to keep our journalism open, without influence or the need to drive traffic.Journalism, reporting and commentary on Silicon ANGLE – as well as live, unscripted videos from our Silicon Valley studio and globe-trotting video teams at The cube – take a lot of hard work, time and money. Maintaining high quality requires the support of sponsors who align with our vision of ad-free journalistic content.

If you enjoy the news stories, video interviews, and other ad-free content here, please take a moment to view a sample of the video content supported by our sponsors, tweet your support, and keep coming back to Silicon ANGLE.

Leave a Reply

Your email address will not be published.