Sofi acquires Fin-tech core banking platform Technisys in an all-stock transaction for around $1.1 billion.
Technisys is expected to generate $70 million in sales in 2021. Sofi is expanding its “AWS Fintech” division, commonly known as Galileo. The transaction indicates where management’s priorities are, which I appreciate because Galileo is one of their fastest-growing business categories and has one of the highest potentials, along with the “Super Financial Service App.”
Here’s some more info on that bit!
- Increases “high margin” income by $500-800 million through
- Technisys broadens Galileo’s software offering beyond payment processing to include almost everything else, including card issuance. Cross-selling opportunities exist for Chime and other Galileo clients.
- In addition, SoFi will leverage the platform to enhance its own consumer-facing interface, completely integrate its tech stack, and reduce third-party service expenses.
This, I firmly feel, is a sleeping behemoth. Patience is required for this one. Going public via SPAC amid the mania and during crazy QE times with a wacky market resulted in a very loud play.
I’m looking forward to seeing how this firm performs under more benign conditions in a few years.
Already serving FinTechs through one of its branches - Sofi is pushing to participate in digital banking!