The Newest Online Lending Unicorn: SoFi Lands $200M
February 04, 2015
Online lending platform Social Finance (SoFi) has raised $200 million in Series D funding at a $1.5 billion valuation. The investment was led by Third Point Ventures and included participation from Wellington Management Company, Institutional Venture Partners and existing investors. The company will use the funds to fuel the expansion of its consumer lending products throughout the U.S. and build out its marketplace with new options for investors. SoFi launched in 2011, offering refinancing of federal and private student loans. Since then, it has originated over $1.75 billion in loans and has expanded to offer a suite of solutions including mortgages, MBA loans and personal loans.
SoFi's growth has been impressive. The company has recorded a valuation step-up multiple of 8.4x since a September 2012 $80 million Series B valued it at $180 million. Its success may have a lot to do with what two of the biggest VC-backed players in the online lending space—Lending Club and OnDeck—have already accomplished; both companies, founded much earlier, eclipsed the billion-dollar valuation mark before going public in late 2014. SoFi, however, reached a billion-dollar valuation much faster than either, receiving unicorn status within about four years of its founding—compared to the roughly seven years it took Lending Club and OnDeck. With plans for a 2015 IPO, SoFi will likely be the quickest of the three to go public, as well. Below is a chart of each company's valuation through their respective first four rounds of financing:
To see the full list of companies involved in consumer or specialized finance that have raised VC funding since 2010, click here.