eToro Hooks $250M After SPAC Deal Fails

It looks like companies are still grappling with the frozen IPO market and dwindling valuations.

eToro, an Israel-based trading platform, announced on Tuesday it raised $250 million after its plan to go public via SPAC fell through.

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Among participants of the round, which valued the company at $3.5 billion, included SoftBank Vision Fund 2, ION Group and Velvet Sea Ventures.

eToro is another casualty of the financial whiplash in the private markets, where valuations soared in 2021 and was met in 2022 with a far stingier funding market.

Same story, different startup

The company would have been valued at around $8.8 billion had it gone public, but the startup’s plan to IPO with the blank-check company FinTech Acquisition Corp V officially dissolved in July.

The plan was pushed back multiple times. When it was first announced in March 2021, the deal was valued at $10.4 billion. Like Stripe, Klarna and several other startups, eToro’s valuation dropped in 2022 before the SPAC deal shuttered.

There seems to be a pattern forming with late-stage companies. eToro, which was founded in 2007, isn’t the only startup pivoting after a failed attempt at going public. Fast-fashion retailer Shein attempted twice to IPO but was met with a frosty market.

Perhaps going public is not completely off the books. Late-stage companies as old as eToro, Shein and Stripe have reportedly looked into taking their startups public to address expiring shares.

eToro allows users to trade stocks, crypto and other assets. The company was founded in 2007 and raised $582.7 million, according to Crunchbase data. The last traditional funding round eToro raised was in 2018, when it raised $100 million in Series E funds. Its most recent $250 million arrived via Advanced Investment Agreement, according to TechCrunch.

Illustration: Dom Guzman