Fintech firm eToro raises $620m in Nasdaq IPO

EToro Group, an Israel-based stock and crypto trading platform, has raised about US$620 million in an upsized US IPO.

The company priced 11.92 million shares at US$52 each, above its initial range of US$46 to US$50.

Shares will begin trading May 14, on the Nasdaq Global Select Market under the ticker symbol “ETOR.”

Founded in 2007, this marks eToro’s latest push to go public after scrapping a US$10.4 billion SPAC merger in 2022.

In September 2024, eToro agreed to limit its crypto offerings in the US to bitcoin, bitcoin cash, and ether following a settlement with the SEC.

The deal addressed eToro’s operations as an unregistered broker and clearing agency. Goldman Sachs, Jefferies, UBS, and Citigroup are leading the underwriting.

🔗 Source: Reuters

🧠 Food for thought

1️⃣ eToro’s SPAC-to-IPO journey shows shifting fortunes in fintech valuations

eToro’s current IPO marks a dramatic shift from its previous attempt to go public. In 2021, the company planned a SPAC merger valuing it at $10.4 billion during a period of intense interest in fintech companies 1.

That deal collapsed in 2022 amid broader market turbulence, when many high-flying valuations were dramatically reduced across the sector.

Despite this setback, eToro has demonstrated resilience, now pricing its traditional IPO above the target range at $52 per share, indicating strong investor demand and confidence in the platform’s fundamentals.

The company has shown sustainable growth mechanics, reducing its customer acquisition costs from $52 in 2019 to $31 by early 2021, demonstrating improved marketing efficiency as it scaled its user base 2.

With 35 million global users and access to over 7,000 financial instruments across 20 exchanges, eToro has built substantial market presence that appears to be attracting significant investor interest despite previous setbacks 3.

2️⃣ Regulatory compliance reshaping crypto platform business models

eToro’s recent $1.5 million settlement with the SEC highlights the regulatory challenges facing crypto trading platforms in the United States.