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SoFi Raises Yet More Money

By Ryan Weeks on 28th October 2015

The equity money continues to pour in for US marketplace lender SoFi.


Renren Inc. – a leading social networking platform in China – has acquired an additional $150m of preferred stock in SoFi. Renren has been an equity investor in the platform since 2012. The Renren news comes just weeks after the confirmation of a much-rumoured $1 billion Series E investment round, which was led by SoftBank. Word of this monstrous investment round first appeared in the Wall Street Journal in August, when we learnt that SoFi’s valuation had soared to around $4bn.


SoFi also recently crossed the $4bn mark in cumulative lending, passing the milestone in early September. The platform can reasonably lay claim to being one of the fastest growing marketplace lenders in the world, after having more than doubled its cumulative lending volume between April and September this year. SoFi began in the field of student loan refinancing, and has since moved into mortgages, mortgage refinancing and personal loans.


Renren reportedly intends to obtain up to $130m in loans from several financial institutions in order to partially finance the $150m investment in SoFi. As one of China’s most active social networking internet platforms, had approximately 227 million activated users as of 30th June 2015. The company is listed on the NYSE, under the symbol RENN.


SoFi had been rumoured to be sizing up a potential IPO, following in the footsteps of Lending Club and OnDeck. But with so much equity money in the bank (the platform also closed a $200m Series D in February this year), one has to wonder whether CEO Mike Cagney will now hold off on taking the company public for a while.


Upon announcing SoftBank’s $1bn investment in early October, Mr. Cagney said:


“This funding will dramatically advance expansion of our disruptive products and experiences, and in turn, meaningfully benefit financially responsible individuals. Our trajectory is clear: we are well on our way to becoming the most trusted financial services partner in the U.S.”


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