It was announced today that the FinTech SoFi has acquired Galileo Financial Technologies, an API and payments platform. It’s reported in the company release that SoFi will pay a purchase price of $1.2 billion comprising of both cash and stock for the API and payments platform.
Galileo will operate as an independent division and will continue its day-to-day operations with founder Clay Wilkes still at the helm. Wilkes founded Galileo in 2000 and has since received two rounds of funding: a $77 million Series A round from Accel in 2019 and an $8 million Series B round from Mercato Partners in April 2014.
SoFi has acquired Galileo Financial Technologies as a way of expanding its suite of financial service products outside of consumer services. Galileo is a digital payment provider who, through their platform, can provide APIs that allow FinTechs such as Monzo and Chime to easily create bank accounts while also issuing physical and virtual payment cards. Now it will be a service SoFi can integrate into its offerings for a seamless customer journey and power global payments worldwide.
Anthony Noto, CEO, SoFi, in the company’s statement said: “SoFi has established itself as a leader in the fintech sector, providing our more than one million members a full array of financial products to help them get their money right. Together with Galileo, we will partner to build on our companies’ strengths to drive even greater financial technology innovation, making those products and services available to both current and future partners.”
Wilkes, CEO of Galileo, speaking on the merger said: “Distributing products through our enterprise-class API is the vision behind this combination. I think it’s very powerful. We’re excited to work with SoFi to build on the services that have made Galileo the leading supplier of infrastructure services to leading financial, technology, and fintech companies. With the help of SoFi, we intend to continue to grow with and support all of our existing clients and the product roadmaps that they have defined.”
The merger between the two comes after news that Galileo last month processed an annualised $45 billion in transactions, up from $26 billion in October of 2019 – close to a 100% increase in processing volume in six months.
SoFi has recently been valued at $4.3 billion after funding rounds as recently as May 2019 where they received $500 million in a funding round led by Qatar.
Noto continued: “Together with Galileo, we will partner to build on our companies’ strengths to drive even greater financial technology innovation, making those products and services available to both current and future partners. While we march forward on our mission to help people achieve financial independence through our own direct efforts, with Galileo, we can enable a broader ecosystem of companies to join us in helping the world achieve financial independence.”
The transaction is subject to regulatory approvals and other customary closing conditions. Goldman Sachs & Co. LLC and Citigroup have served as financial advisors and WilmerHale acted as a legal advisor to SoFi. Qatalyst Partners served as financial advisor and Dorsey & Whitney acted as legal advisor to Galileo.e
