EToro, A Competitor Of Robinhood, Secures $120 Million In Secondary Share Sale

The eToro logo is visible at the 2021 Web Summit in Lisbon, Portugal.
Pedro Fiúza | Nurphoto | Getty Images
Stock trading platform eToro has agreed to a $120 million secondary share sale, resulting in a slightly lower valuation compared to its previous primary funding round earlier this year, which valued the company at $3.5 billion.
According to a memo obtained by CNBC, eToro allowed early employees and angel investors to sell shares to existing investors. This secondary share sale does not involve the issuance of new shares or generate any income for the company. However, it reflects the current price at which investors are willing to buy shares in the firm.
This comes after eToro abandoned its plans for a public listing through a merger with a blank-check company called Fintech V. The proposed deal would have valued eToro at $10 billion, but due to a downturn in equity and crypto prices, it was unsuccessful.
In the memo to employees, eToro CEO and co-founder Yoni Assia stated, “As a business which continues to demonstrate sustainable, profitable growth we are considered an attractive investment opportunity by many investors. This secondary transaction will give existing shareholders in eToro and veteran employees who have vested options the opportunity to sell a proportion of their shares to these purchasers.”
The recent funding round saw eToro raise $250 million from investors, with a valuation of $3.5 billion. Investors included SoftBank Vision Fund 2, ION Investment Group, and Velvet Sea Ventures. The investment was in the form of an advance investment agreement, where investors paid in advance for shares that would be allocated at a later date.
eToro recently partnered with Twitter (now known as X), allowing users of the social media platform to access stock and crypto trading by searching for “cashtags.” The company is looking to expand its partnership with Twitter/X. Assia met with X CEO Linda Yaccarino in New York to discuss potential expansion plans.
During the Covid-19 pandemic, online wealth management platforms, including eToro, experienced heightened demand as people had more time and, in some cases, money to invest. However, more recently, these platforms have faced challenges due to the rising cost of living and a different market environment.
CEO Yoni Assia expressed positivity about the company’s performance in the first half of the year, highlighting strong business performance, increased EBITDA, a growing number of funded accounts, and significant product developments, partnerships, and launches.

eToro, a Competitor of Robinhood, Secures $120 Million in Secondary Share Sale
The recent interest from existing investors in buying more shares provides an opportunity for existing shareholders and veteran employees with vested options to sell a portion of their shares. Assia emphasized the importance of maintaining confidentiality regarding the potential transaction. Employees with eligible options will receive further details via email.

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