SoftBank and Renren-backed online financial services provider SoFi will list on the New York Stock Exchange at an $8.65bn valuation double that of its last round.

Social Finance (SoFi), the US-based online financial services provider backed by internet and telecommunications group SoftBank and social media company Renren, agreed a reverse merger yesterday. The company is merging with Social Capital Hedosophia (SCH) Holdings Corp V, a special purpose acquisition company formed by Social Capital and Hedosophia that floated on the New York Stock Exchange in a $700m initial public offering in October 2020. The deal will form a company set to be valued at $8.65bn and will be boosted by $1.2bn in financing from Hedosophia, SCH founder and CEO Chamath Palihapitiya, Altimeter Capital, Baron Capital Group, Coatue, Durable Capital Partners, Healthcare of Ontario Pension Plan and funds and accounts managed by BlackRock. Founded in 2011, SoFi operates an online platform with some 1.8 million users that began as a student loan refinancing specialist before expanding into areas like mortgage and home improvement financing, investment services and digital insurance. The deal comes after about $2.4bn in funding including a $500m investment by the state-owned Qatar Investment Authority in May 2019 that valued SoFi at $4.3bn pre-money. The company had raised $500m at the same valuation in a 2017 series F round led by private equity firm Silver Lake that also featured SoftBank and asset management firm GPI Capital. SoftBank led SoFi’s $1bn series E round in October 2015, investing with Renren, IVP, Wellington Management Company, Baseline Ventures, DCM Ventures and Third Point Ventures at a $4bn, with Renren investing a further $150m later the same month. SoFi had already received $200m in series D funding from Third Point, Wellington Management, IVP and unnamed investors earlier the same year. Renren, DCM, Wicklow Capital, Peter Thiel and existing investors including Baseline Ventures had supplied $80m in a 2014 series C round, two years after a $77.2m series B featuring $49m from Renren and additional cash from Baseline Ventures and DCM. Anthony Noto, SoFi’s CEO, said: “SoFi is on a mission to help people achieve financial independence to realise their ambitions. Our ecosystem of products, rewards and membership benefits all work together to help our members get their money right. “With the secular acceleration in digital-first financial services offerings, SoFi is the only company providing a comprehensive solution all in one app. “The new investments and our partnership with Social Capital Hedosophia signify the confidence in our strategy, the momentum in our business, as well as the significant growth opportunity ahead of us. We look forward to helping more people get…

Subscribe to go deeper

GCV subscribers get access to all our proprietary data and deep-dive articles, as well as the global directory of CVC investors.



Not sure if you have a subscription?
Robert Lavine

Robert Lavine is special features editor for Global Venturing.