Israel-based trading platform eToro reported raising $250 million on March 21. The company secured financing for the first time since 2018 after abandoning ambitions to go public via a SPAC at a $10.4 billion value in 2022.
SoftBank Vision Fund 2, ION Group, and Velvet Sea Ventures were among the investors in the round, which gave the business a $3.5 billion valuation.
In line with its anticipated SPAC transaction, eToro claims that the funding is the result of an Advance Investment Agreement (AIA) that was signed in the early part of 2021. The AIA is a contract between an investor and a business in which the investor promises to make substantial investment in the latter.
eToro Abandons SPAC Deal
The trading platform was valued at $10 billion when the SPAC takeover was announced by eToro and Fintech V in 2021. A bilateral agreement ending the merger was announced by eToro and Fintech V in July of last year.
According to eToro, commissions totaled $631 million in 2022, a decrease of 49% from 2021 and an increase of just 5% from 2020, when eToro’s revenue hit $605 million. According to its SPAC filing, revenue will amount to $2.5 billion by 2025.
Yoni Assia, the founder and CEO of eToro, said in a statement: “We’ve seen a positive start to the year with markets reacting favorably to ‘less bad’ news and retail trading hitting an all-time high,” he added: “Year to date, we have seen an improvement in total commissions and profitability compared with the previous quarter with higher engagement and trading activity from our users.”
Notwithstanding the ongoing market instability, eToro continues to extend its footprint in the United States. The finance company purchased financial technology startup Gatsby last year in an effort to diversify its offerings and establish a national footprint. Also, the trading platform has obtained regulatory authority to offer services linked to cryptocurrencies in New York.
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