Online lender Social Finance reportedly plans to follow in the footsteps of LendingClub and tap the markets for capital in an initial public offering, sources told Bloomberg.

The San Francisco-based startup hopes to raise $500 million with an IPO likely in the second quarter, which would value the company at $3.5 billion, unnamed sources told Bloomberg.

socialfinanceGoldman Sachs and Morgan Stanley would likely work with Social Finance, also known as SoFi, though the company’s chief executive Michael Cagney reportedly “hasn’t decided which firm will be the lead bank.” Last month, Goldman Sachs helped the startup raise $200 million at a valuation of $1.3 billion. Investors included Third Point Ventures and Wellington Management.

SoFi was launched in 2011 as an alumni crowdsource lender for Stanford University students, but has since expanded nationally with offerings including mortgages and personal loans, according to Bloomberg.

Still, SoFi bills itself on Google as a “student loan consolidation and refinancing” company.

To date, the online platform has made more than $1.75 billion in loans, claiming on its website that it has saved borrowers an average of $11,783.

“Student loans are a ripe area for startups,” Bloomberg wrote. “The climbing cost of college has helped swell total student debt to almost $1.2 trillion, with the federal government holding or backing more than $1 trillion of that amount, the U.S. Consumer Financial Protection Bureau said last year.”

More than two months after going public, LendingClub’s market capitalization is $7.8 billion. Its shares were trading at about $19.86 on Monday, down from a high close of $27.90 in December.

On Deck Capital, another online lender that went public last December, has a current market cap of $1.1 billion. On Deck’s shares have also fallen considerably from a high close of $27.98 on December 17.

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One response to “SoFi Reportedly Seeking $3.5B Valuation”

  1. SoFi looks increasingly growing rapidly. Of course, we love to read reports of this company has been able to help many people who have student debt. This is definitely a great achievement. Success for the work program SoFi.

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