Israeli investment platform eToro acquires Spaceship for $80m

Trading platform eToro is going after a slice of the Australian superannuation market, acquiring a Mike Cannon-Brookes-backed super play in a deal worth up to $80m.

eToro founder and chief executive Yoni Assia.

The Mike Cannon-Brookes-backed superannuation fintech Spaceship has been snapped up by Israeli trading platform eToro in a deal worth up to $80m.

The deal gives eToro an even larger slice of a growing market of younger investors trading on smaller, indie platforms.

The transaction had been in the works for some months, with eToro beginning its search for an Australian partner in January this year, local managing director Robert Francis told The Australian. “This is where we think we have a path to play,” he said.

Australia had been earmarked as its next big focus – after its largest market in Britain – and as a potential gateway to Asia, Mr Francis said.

The company plans to grow its customer base by doubling down on savings and superannuation products, many of which it believes would be attractive to younger investors priced out of the property market.

“This is an opportunity for people to grow their wealth outside of the family home,” Mr Francis said. “For people getting started on their investing journey, it’s pretty difficult to buy property or a home, so people are looking to put their money elsewhere.”

Spaceship chief executive Andrew Moore.

The acquisition allowed eToro to build and launch Australian-market-specific products that are accessible to eToro’s customers without changing its overall global focus, Mr Francis said.

While eToro has no plans to ditch the Spaceship brand, it will look to integrate the apps so that products are available to customers of either platform.

Since its founding in 2017, Spaceship has picked up 200,000 clients, with $1.5bn in funds under management.

It has also picked up some high-profile backers including Atlassian chief executive Mr Cannon-Brookes and Paypal co-founder Peter Thiel.

Local venture capital firms AirTree and Grok Ventures have taken part in more than $50m worth of capital raisings by the company.

Spaceship claims its GrowthX super product has had an 11 per cent annualised performance since its launch.

But it hasn’t been all smooth sailing for Spaceship, which last year was banned from taking on new customers and allowing existing customers to make new investments.

The corporate regulator was concerned over the firm’s target market determinations and its medium to high-risk investments in the tech sector at the time.

The ban has now been lifted.

Spaceship chief executive Andrew Moore told The Australian that his business’s new owners shared a similar “vision of making investing more accessible”. “This partnership will enhance our Australian operations and pave the way for innovative growth strategies,” he said.

“By teaming up, we’ll be able to broaden our tech capabilities and offer new products to our users.”

The acquisition will see both eToro and Spaceship customers able to access products from each other’s offering.

Yoni Assia, eToro’s chief executive, founded the platform in 2007. It has since launched in 75 countries and has 38 million registered users.

The acquisition of Spaceship would help the company beef up its offering in Australia, he said.

“We are expanding our long-term savings and investing proposition for our users globally and this acquisition is a key step on this journey,” he said.

“We hope that this deal will be the first of many in the long-term savings and investing space as we continue to build out our localised product offering in our key markets.”

EToro’s local operation is managed by director Robert Francis, who described the deal as an example of the company’s commitment to Australia.

“This is a significant milestone for eToro in Australia and underscores our commitment to growing our presence here,” he said.

“By combining Spaceship’s superannuation proposition with eToro’s multi-asset investment offering, we can better support our users throughout their investment journeys.