EV Automaker Rivian to Offer IPO Shares on SoFi Invest
In recent years, the true power of retail investors — especially those using FinTech apps such as Robinhood and others — has been on full display. Thus, earlier this year, some of these platforms began offering customers the ability to purchase initial public offerings shares at their list price before they hit the market. Now, the much-hyped electric vehicle manufacturer Rivian has revealed that it will be inviting SoFi users to purchase their upcoming IPO shares.
According to its preliminary prospectus, the Ford and Amazon-backed startup plans to offer up to 0.5% of its Class A stock to SoFi Invest customers. With the automaker set to issue 135 million shares, this would amount to up 675,000 shares being offered to retail investors through the platform. Currently, $RIVN shares are expected to be priced between $57 and $62, giving the brand a valuation in the neighborhood of $55 billion.
Previously, in order to request shares via IPO Investing, SoFi customers needed to have at least $3,000 between their SoFi Invest accounts (Active and Automatic). However, this policy was adjusted this summer. Now, SoFi’s FAQ now states that “SoFi Active Investing members can invest in IPOs with no account minimums.” However, customers purchasing IPO shares on SoFi do need to agree to the service’s anti-flipping policy that states in part that customers who sell shares acquired at IPO prices within 120 days may be subject to a $50 transaction fee. Additionally, selling shares in this timeframe may impact a user’s ability to participate in future initial public offerings on the platform.
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This arrangement between Rivian and SoFi comes as the FinTech continues to faceoff against the infamous trading app Robinhood. Shortly after SoFi announced its IPO Investing offering in April, Robinhood unveiled a similar feature — notably, waiving the aforementioned $3,000 account minimum that SoFi initially instated. Robinhood would later use the platform to offer a portion of its IPO shares directly to its users.
It looks as though this Rivian IPO will be an interesting test for SoFi as interest in this IPO in particular and initial public offerings in general heats up among retail investors. Similarly, it will be worth keeping an eye on which companies perform well on these platforms, what factors seem to drive demand (price per share likely being among them), and what percentage of requested shares are filled. As we enter a brave new world of FinTech, investing, and electric vehicles, there’s surely plenty of disruption to be found ahead.