eToro raises $250M in funding following stellar 2022 financial year

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Social trading platform eToro Group Ltd has successfully completed another funding round, raising $250 million amid a slew of impressive metrics.

The firm announced that $250 million in funding valued the company at $3.5 billion. Participants include SoftBank Vision Fund 2, ION Group, Velvet Sea Ventures, and several investors from previous funding rounds.

The latest funding round has been in the works since 2021, stemming from an Advance Investment Agreement (AIA) that guaranteed future investment in the company. eToro’s AIA was signed during the peak of a proposed special purpose acquisition company (SPAC) transaction that sought to take the company public.

Plans to go public fell through after the SPAC terminated its agreement with the company citing “circumstances outside of either party’s control.” At the time, experts surmised that the challenges faced by eToro were triggered by the extended bear market for digital assets, but the firm’s CEO claimed that the company’s finances were in perfect health.

Despite the disappointment, eToro noted that it went on to have a stellar 2022. The firm succeeded in acquiring the social investing platform Bullsheet in October as a follow-up to the impressive acquisition of Gatsby.

On the financial side of things, the Israeli-based trading platform earned $631 million in commissions, with digital currencies accounting for 6% of the earnings, while equities and commodities made up 48% and 27%, respectively. eToro noted that by the end of 2022, there were 2.8 million funded accounts, a rise from the figures of 2021.

“The diversified nature of our multi-asset product offering ensured that commission from equities and commodities partially offset the decrease in commissions from cryptoassets in 2022,” said eToro CFO Meron Shani. “It is also worth noting that we were not impacted by the liquidity concerns which plagued many in the crypto industry.”

A beehive of activity

While the rest of the players in the space roiled from low transaction volumes, eToro continued to expand its offerings and spread its tentacles to new jurisdictions. The firm secured an in-principle approval to operate as a broker in Abu Dhabi while securing digital asset licenses in France, New York, and Italy.

eToro’s subsidiary launched a portfolio manager for non-fungible tokens (NFTs), while the firm partnered with ESG Book to provide ESG scores for assets on the platform. The learning arm of the platform recorded 1.7 million unique visitors, with the company providing over 1,450 educational materials to improve the trading knowledge of customers.

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