Early
investor Spark Capital scored a massive $530 million gain as trading platform eToro
(NASDAQ: ETOR) made a spectacular entrance into public markets on Wednesday,
with shares closing 29% above their initial offering price.

The
Israel-based investment platform closed at $67 per share, well above its $52
IPO price, giving the company a market valuation exceeding $5.5 billion and
delivering a 29-fold return on Spark’s original $19 million investment made 15
years ago.

eToro Shares Jump After
$620 Million IPO

The trading
platform and some of its backers raised
nearly $620 million in an upsized public offering that drew significant
investor interest. The company had originally planned to offer 10 million
shares but increased this to 11.92 million shares, pricing them above the
initially marketed
range of $46 to $50.

“We
continued to get good feedback from investors, especially since tariffs don’t
really impact eToro’s business,” said Yoni Assia, Co-Founder and CEO of eToro, referencing the
recent market volatility triggered by tariff announcements. “When you look
at what our customers did, or generally what retail investors do, they actually
bought stocks.

At its peak
following the Nasdaq debut, eToro
shares surged by about 40%, testing the $74.28 level, but ultimately ended
the day at $67.

And
although the debut faced some bumps along the way, including an April
disruption caused by Donald Trump’s trade war that temporarily
halted IPO roadshows, the company ultimately managed to go public—and did
so with clear success.

A Renewed IPO Landscape

eToro’s
successful debut represents a turning point for the U.S. IPO market, which
has seen several companies delay their public offerings following President
Donald Trump’s April 2 tariff announcements. The strong demand for the
company’s shares-reportedly more than 20 times the available offering-suggests
renewed appetite for new listings.

BlackRock-managed
funds had previously indicated interest in purchasing up to $100 million worth
of shares at the IPO price, highlighting institutional confidence in the
platform’s prospects.

Founded in
2007, EToro offers a platform where users can trade various assets including
stocks and cryptocurrencies, while also following top investors’ strategies.
The company had previously attempted to go public through
a SPAC merger at a $10.4 billion valuation but abandoned those plans.

“I
think we made the right decision in 2022 to terminate the SPAC process and
remain private, and focus on changing our strategy from growth at all costs to
profitable growth,” Assia noted. “We’re coming to the market as a
much more mature company.”

$530 Million Gain for
Early Investor

Spark
Capital emerged as the biggest winner in the IPO, with its early $19 million
investment now valued at approximately $530 million. The venture firm remains
EToro’s largest shareholder with approximately 13% ownership, having sold only
a small portion of its stake during the offering.

“It
took a lot of pain and suffering to get here,” said Spark co-founder Santo
Politi, who joined eToro’s board in 2010 when the firm first invested in the
company. Spark’s investment thesis centered on bringing social media technology
to the finance world, aligning with its other successful bets on platforms like
Twitter (now X) and Tumblr.

The
first-day gain of 29% added almost $148 million more to the value of Spark’s
stake in the company, on top of its holdings at the time of the listing.

eToro’s Financial
Performance

The
company’s financial results have shown significant improvement, reporting
a net contribution of $787 million in 2024 with net income of $192 million.
This marks substantial growth from 2023, when the company reported a net
contribution of $557 million and net income of $15.3 million.

The company
reported that its 2024 crypto revenue reached $12.1 billion, up significantly
from $3.4 billion in 2023. However, it expects crypto to account for a smaller
percentage of its trading commission in the first quarter of 2025-37% compared
to 43% in the same period of 2024.

eToro
competes with platforms like Robinhood Markets in the retail investment space. For
HOOD, which debuted on Wall Street in 2021, the first day of trading was
not as positive, with the share price shrinking by 1.9% to $61.39.

In the
offering, eToro itself sold 5.96 million shares, while existing shareholders
including Spark Capital, BRM Group Ltd., Andalusian Private Capital, CM
Equities SP, and company executives including the Assia brothers offered
another 5.96 million shares.