SoFi Technologies Inc. is reportedly acquiring a majority stake in British fintech firm PrimaryBid, a move that would significantly strengthen its position in the retail IPO market. According to a Sky News report on Monday, the transaction sent SoFi shares up 1.7% to $16.02 in midday trading on the New York Stock Exchange, with volume approaching 39.5 million shares.
Strategic Expansion
The acquisition builds on an existing partnership between the two companies. In 2024, SoFi and PrimaryBid launched a directed share platform designed to allocate IPO shares to retail investors, employees, and customers, rather than exclusively to large institutions. SoFi CEO Anthony Noto previously described the collaboration as "the natural evolution" of expanding investor access, while PrimaryBid's Anand Sambasivan emphasized the importance of "investor inclusion at IPO."
The deal comes amid intensifying competition for retail IPO allocations. In March, Reuters reported that Morgan Stanley's E*Trade was negotiating to front the retail portion of SpaceX's IPO, potentially leapfrogging rivals including Robinhood Markets and SoFi. Both firms remain in contention for a piece of that high-profile offering.
Financial Performance
SoFi posted strong first-quarter results, with GAAP net revenue climbing 43% year-over-year to $1.1 billion. Net income reached $166.7 million, translating to diluted earnings per share of 12 cents. Loan originations totaled $12.2 billion, comprising $8.3 billion in personal loans, $2.6 billion in student loans, and $1.2 billion in home loans. Membership surged 35% to 14.7 million.
Despite the earnings beat, SoFi shares declined in April after the company maintained its full-year 2026 guidance. Analyst Andrew Jeffrey of William Blair noted that SoFi "did not flow through" its first-quarter revenue and EBITDA gains into the outlook.
Deal Details and Risks
Sky News did not disclose the purchase price, deal structure, or expected timeline, and Reuters noted it had not independently verified the report. The acquisition could still be restructured or fall through entirely. SoFi's balance sheet also faces potential dilution: its 2026 convertible notes became freely convertible after April 15, potentially adding roughly 19.1 million shares, which the company plans to settle with a mix of cash and stock.
SoFi operates through three segments: Lending, Technology Platform, and Financial Services, which includes SoFi Money and SoFi Invest. The PrimaryBid acquisition would deepen its technology platform capabilities and fee-based revenue streams.
Market Implications
The deal highlights the growing value of retail IPO access as a competitive battleground. If completed, the acquisition could help SoFi differentiate itself from rivals by offering a more integrated solution for companies seeking to democratize share allocations. However, integration challenges and the need to demonstrate tangible fee revenue growth remain key hurdles.
