Retail trading platform eToro has reportedly submitted confidential filings to US regulators as it gears up for an initial public offering (IPO) in New York.
According to a Financial Times report, this move could potentially value the company at over $5 billion, reflecting its ambitions to expand its presence in the US market.
From London To New York: eToro’s Shift Towards A US IPO
Founded in 2007, eToro has established itself as a key player in the trading sector, allowing users to trade a variety of assets ranging from stocks to cryptocurrencies.
The platform currently manages approximately $11.3 billion in customer assets across 3 million accounts, making it a significant player in the retail trading space.
With its largest market being the UK, eToro’s decision to pursue a US listing comes amid a trend of companies shying away from London, which has struggled to attract high-profile listings in recent years.
Yoni Assia, the company’s chief executive and founder, has previously articulated the advantages of a US listing, emphasizing that it would provide access to a broader and more diverse range of investors.
“Very few of our global clients would trade UK shares,” Assia noted in an interview with the Financial Times last year. He highlighted that the US market offers a unique combination of “deep liquidity and heightened awareness for assets,” making it a more attractive option for eToro’s expansion plans.
The confidential filings with the Securities and Exchange Commission (SEC) permit eToro to advance its IPO aspirations privately before making its plans public.
This method has become popular among companies looking to gauge market conditions and investor interest without the immediate pressure of public scrutiny. If successful, eToro could potentially list its shares in New York as soon as the second quarter of this year.
Goldman Sachs, Jefferies, And UBS Join Forces
eToro’s path to going public has not been without its challenges. The company initially sought to enter the public market in 2021 through a merger with a blank-check company, a transaction valued at $10.4 billion.
However, that attempt was ultimately abandoned in 2022 due to unfavorable market conditions, particularly following the decline of special purpose acquisition companies (SPACs), which had been touted as a quick route to public status.
Following a funding round in 2023 that raised $250 million from investors including SoftBank and the market data company Ion Group, eToro’s valuation was pegged at $3.5 billion.
But as the company prepares for its upcoming IPO, projections suggest that its valuation could exceed $5 billion, underscoring investor confidence in its growth potential.
To facilitate its IPO, eToro has enlisted the expertise of some of the leading investment banks, including Goldman Sachs, Jefferies, and UBS.
These financial institutions are expected to play a key role in guiding the company through the IPO process, leveraging their extensive market knowledge and connections to ensure a successful entry into the public markets.
Featured image from DALL-E, chart from TradingView.com
