eToro going public by combining with Nasdaq-listed SPAC

Online-focused multi-asset investment platform eToro is set to become publicly traded, it announced on Tuesday, by combining with the Nasdaq-listed special purpose acquisition vehicle FinTech Acquisition Corp V.

The company was expected to have an estimated implied equity value of around $10.4bn.

In 2020, eToro added more than five million new registered users and generated gross revenues of $605m, and in January of this year it added more than 1.2 million new users and executed more than 75 million trades.

It said its platform was focussed on capitalising on trends, including the rise of digital wealth platforms, growing retail participation, and the mainstream adoption of cryptocurrencies.

The transaction included commitments for a $650m common share private placement from a number of investors including ION Investment Group, Softbank Vision Fund 2, Third Point LLC,

Fidelity Management & Research Company LLC, and Wellington Management.

“We founded eToro with the vision of opening the global market for everyone to trade and invest in a simple and transparent way,” said eToro chief executive officer Yoni Assia.

“Our users come to eToro to invest, but also to communicate with each other; to see, follow, and automatically copy successful investors from all around the world.

“We created a new category of wealth management - social investing - and we are dominating the market as evidenced by our rapid expansion.”

Betsy Cohen, chairman of the board at FinTech V, said that its sponsor platform, Fintech Masala, looked for companies with outsized growth, effective controls and “excellent” management teams.

“eToro meets all three of these criteria.

“In the last few years, eToro has solidified its position as the leading online social trading platform outside the United States, outlined its plans for the US market, and diversified its income streams.

“It is now at an inflection point of growth, and we believe eToro is exceptionally positioned to capitalise on this opportunity.”