SoFi Is More Than Student Loans. Instacart IPO Proves It.

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SoFi Technologies

He focused on how student-loan repayment rebounds affect the need for refinance. But now fintech is showing that it can do more, and analysts are happy about it.

SoFi (symbol: SOFI) is helping. Write the first major public offeringFor grocery-delivery company Instacart, Financial Times reported. The newspaper, citing two people involved in the deal, said it plans to offer shares to users of the retail investment app.

SoFi did not immediately respond to a request for comment.

Moffett Nathanson managing director Eugene Simoni said the company’s main reason for participating in the underwriting process is to give its users direct access to the IPO. He called the news a “very positive development.”

“Sophie’s strategy is to build a comprehensive digital financial services platform that can match the breadth of services offered by large traditional banks (e.g. JPM),” said Simuni. Baron In an email on Tuesday. Digital investment services are a key component of a challenging platform to develop, he said.

“The Instacart deal indicates that SoFi is making progress on this scale. To be clear, the immediate financial implications are modest — investment services currently only account for ~1% of SoFi’s revenue,” he continued. “However, the breadth of Sofi’s offering is a critical differentiator for Sofi in attracting, retaining and engaging users – a critical competitive axis in digital banking. We rate the stocks on Market Outperform.

Mizuho

Managing director Dan Dolev, who rates the stock at Buy, echoed the sentiment.

“Having more products and services in general shows that SoFi will find more ways to monetize,” Dolev said. Baron In the email. “In addition, these types of services will increase the impact of Sophie’s Flywheel and make it more sticky for its customers.”

Sophie first mentioned plans to enter IPO business in March 2021, the Financial Times reported. Since then, the company has served as lead underwriter on five deals, all involving special purpose acquisition companies, he said.

Shares were down 0.4% to $8.76 in the morning. This year, the stock has increased by 90%.

Write to Emily Dattilo at [email protected]