Tradonomi, the parent company behind eToro has completed a $2.4 million round led by new investor Social Leverage, with participation of previous backers BRM Capital and Cubit Investments. eToro has raised approximately $8 million to date from the aforementioned funds as well as prominent Israeli angels including Guy Gamzo, Chemi Peres as well as Ofer and Yaron Adler. Most recently, eToro added $6.3 million to its coffers in April of 2009.
Israel-based eToro offers social “trading arenas” for foreign exchange (FOREX), commodities and indices in a fun and social way. The product is built almost as a game, targeting both entry-level and expert users. The site lets you start off with fake money and start trading right away. With over 1.5 million registered users to date, eToro may very well be onto something.
eToro has quite a few hooks to attract the users and keep them engaged:
- Learning value – eToro really puts the emphasis on educating the users on FOREX (to increase trading volumes)
- Recession proof – while sites like kaChing would take a hit when the market is down, FOREX markets make the most money when volatility is high.
- The tools offered on the site could easily compete with professional investment software in a family office or a small trading desk. Graphs, charts, statistics and so on.
- Community – a forum, one to one help and the ability to connect with other users and compete with them on trading challenges, gives eToro the look and feel of a multi player online game, except that the money can be real and the transactions update based on the real world.
Techcrunch also notes the parallels of eToro’s platform with StockTwits, which could be a nice growth engine for both companies. eToro is based in Tel Aviv, Israel with offices in NY, Australia and Cyprus. The company has 120 employees and is led by co-founder and CEO Jonathan Assia and his brother Ronen.