Israel’s EToro will go public through a $ 10.4 billion SPAC deal backed by SoftBank, others

(Reuters) – Online equity brokerage eToro has agreed to go public via a merger with a blank check firm backed by banking entrepreneur Betsy Cohen, in a $ 10.4 billion deal backed by SoftBank’s Vision Fund 2.

EToro competes with Robinhood, which has become extremely popular with young investors for its easy-to-use interface. Robinhood has emerged as a gateway for amateur traders braving the Wall Street hedge.

The deal with FinTech Acquisition Corp V, a special purpose acquisition company, will include an investment of $ 650 from leading investors including Vision Fund 2, Fidelity Management & Research Co LLC and Wellington Management.

Founded in 2007, eToro has 20 million registered users who can manually invest in cryptocurrencies, stocks, commodities, exchange traded funds and more, while those without the time or experience can automatically copy the trades of others on the platform.

Special Purpose Acquisition Companies, or SPACs, are shell companies that use the proceeds from an IPO to make private companies public.

Cohen, who founded Jefferson Bank and Bancorp Inc, is one of the prominent business women who have joined the SPAC frenzy.

EToro joins a wave of Israeli tech companies and startups, including mobile gaming company Playtika Holding Corp, which are going public in the United States to take advantage of the boom in capital markets.

In 2020, eToro added over 5 million new registered users and generated gross revenues of $ 605 million, an increase of 147%. from a year earlier.

Bitcoin represents one of 25 open positions on eToro, while the most popular stocks are Tesla Inc, Microsoft Corp and Apple Inc, according to the company’s website.

Reportage by Noor Zainab Hussain in Bengaluru; Editing by Anil D’Silva and Shounak Dasgupta