JPMorgan Chase, the largest bank in the US, has over 5,000 retail bank branches.
Wells Fargo has over 4,000.
Bank of America has over 3,000.
Meanwhile…..Sofi has 0 bank branches!
The old-style traditional way of doing banking is over.
A grandmother in the 1990s had to make an appointment a week in advance and physically go to the bank to do even the smallest of changes.
Luckily, her granddaughter doesn’t have to go to the bank anymore.
She can open an account, apply for a loan, refinance her student debt, get a mortgage, chat with a customer representative, and invest her savings by simply using the SoFi app on her phone without leaving the house.
Sofi’s entirely digital platform resonates strongly with young people, enabling the company to become a neo-bank leader, especially popular with high-income recent university graduates.
In just 5 years, Sofi 10X’ed their members, from 1M to 10M!
Nowadays, Sofi is constantly releasing new products, increasing cross-sales, and ramping up profitability, with aspirations to become a “One-Stop-Shop” for all financial needs!
In this Sofi Investment Case report, I will tell you why I find Sofi to be an incredibly compelling long-term investment opportunity.
The Sofi Bull Case is driven by student loan refinancing, lending, “One-Stop-Shop” innovation, the Loan Platform Business, and their SaaS “AWS of Banking” software business.
Let’s look at the offering.
1. Student Loan Refinancing
2. Lending
3. One-Stop-Shop Innovation
4. Loan Platform Business
5. AWS of Banking
6. Valuation
7. Conclusion
1. Student Loan Refinancing
The US has become world-famous for the quality of its universities, with prestigious universities such as Harvard, Princeton, MIT, Yale, and others attracting hundreds of thousands of students. Many of the world’s most famous and powerful people in business, government, and science have studied there.
While many applaud these institutions for their academic rigor, others criticize them for abusing their position as gatekeepers of high-income employment to enrich themselves and their faculty.
In the past 2 decades, the average tuition fee has risen by 60% from $9,204 per year to $14,688!
This has created a student loan epidemic of gigantic proportions!
As of 2024, the total US student loan debt balance stands at $1.77T!