SoFi
| Private | |
| Industry | Financial services |
| Founded | August 2011 |
| Headquarters | San Francisco, California |
| Products | Student loan refinancing Mortgages Personal loans Parent loans Wealth management |
| Website | sofi |
Social Finance, Inc. (commonly known as SoFi) is an online personal finance company that provides student loan refinancing, mortgages and personal loans.
SoFi was founded in 2011 by Mike Cagney, Dan Macklin, James Finnigan, and Ian Brady, four students who met at the Stanford Graduate School of Business. The founders hoped SoFi could provide more affordable options for those taking on debt to fund their education. The company’s inaugural loan program was a $2 million pilot at Stanford. For this pilot, 40 alumni invested an average of $50,000 to 100 students.
In September 2012, SoFi raised $77.2 million, led by Baseline Ventures, with participation from DCM and Renren.
On October 2, 2013, SoFi announced that it had raised $500 million in debt and equity to fund and refinance student loans. This total funding amount came from $90 million in equity, $151 million in debt, and $200 million in bank participations, with the remaining capital from alumni and community investors. The $151 million in debt includes a $60 million line of credit from Morgan Stanley, and a $41 million line of credit from Bancorp.
As of September 2013, SoFi had funded $200 million in loans to 2500 borrowers at the company’s 100 eligible schools.
In November 2013, SoFi announced a deal with Barclays and Morgan Stanley to create a bond backed by peer-to-peer student loans, and this would create the first securitization of these loans to receive a credit rating.
In April 2014, SoFi raised $80 million in a Series C round led by Discovery Capital Management with participation from Peter Thiel, Wicklow Capital, and existing investors. Money was raised to expand the footprint of the company's student loan refinancing business and to extend into new products like mortgages and personal loans.
In February 2015, the company announced a $200 million funding round led by Third Point Management. That same month, the company officially began offering personal loans.
By March 2015, the company was offering mortgages in more than 20 states, up from its initial launch that included under ten states in October, 2014.
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