Bloomberg has reported that SoFi plans to raise $500 million in an IPO later this year. This would value the company at $3.5 billion. The valuation is very large and far higher than many would have expected. It is far more than the $1.3 billion the platform was valued at in a recent $200 million Series D funding round.
The source states that SoFi plans to file an S-1 in Q2, and go public in the second half of 2015. However, this is of course subject to change depending on market conditions.
So far SoFi has originated over $1.75 billion in loans and it is set to expand quickly as it recently added two new products. This year SoFi has also expanded it’s offering by starting to provide consumer loans. These new loans allow consumers to borrow between $10,000 and $100,000 at fixed interest rates starting at 5.5% APR. SoFi believes that these are the only loans in the market that are designed to meet the needs of early career professionals. In addition to this in October last year SoFi launched a mortgage product, again targeted at those who will be transitioning from paying off their student loans to looking for a mortgage.
SoFi’s IPO comes after the successful IPOs of Lending Club and OnDeck. Lending Club was valued at $7 billion after it floated with OnDeck valued at $1.1 billion. Although since the IPO the price of Lending Club and OnDeck shares has nosedived and OnDeck is now trading below its IPO price. Lending Club is currently trading at $19.45 and OnDeck at $16.78, if these prices continue to slide it will effect how and when SoFi comes to market.