Just three months after Mike Cagney's board ousted him amid allegations of sexual harassment, the founder of SoFi is already plotting his comeback.
Cagney has been approaching investors in recent weeks about a new fintech startup with a plan to raise about $25 million, according to multiple people familiar with his outreach. He has pitched investors such as Peter Thiel along with several others who were backers of SoFi, a company that Cagney pushed to become worth almost $5 billion.
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The quick rebound has angered some industry observers and others close to Cagney, who only left SoFi on Sept. 15. Cagney was forced out after a series of damaging stories that detailed a workplace culture rife with alleged misconduct and improper treatment of women.
Cagney is starting the new company alongside his wife, June Ou, who previously served as SoFi's chief technology officer, the people said. The company does not yet have a name and has yet to be publicly announced — Ou's LinkedIn page says she will serve as the COO of a "#newCo."
Cagney declined to comment Friday. Ou did not respond to requests for comment.
The company is said to focus on HELOC, or home equity lines of credit, though the people said the idea was in the early stages and still required more sharpening. Ou this month shared a job posting on GlassDoor for engineers at a company soon to launch.
"We are launching a new FinTech focused company in the credit enablement space with the mission of leveraging blockchain, AI and advanced analytics to unlock new access points for consumer credit products that can transform the financial lives of our users," the listing reads. "We are a group of passionate innovators and serial entrepreneurs with a proven track record of creating billions of dollars in value in the FinTech space."
Cagney describes himself on social media now as an "entrepreneur, macro trader, philanthropist." Cagney previously worked at Cabezon Investment Group, his hedge fund that SoFi acquired in 2016, but one person said he would work full-time at the new company. The person said Ou could serve as the CEO and Cagney as her subordinate.
The company will be based in downtown San Francisco, though the job listed in Glassdoor is based in Bozeman, Montana, near where some of the SoFi engineering team has been housed in Helena. SoFi's past vice president of engineering, Matt Conroy, posted the job on LinkedIn.
Some of the initial money for the startup will come from Cagney's own pockets, people said. That money will likely be enough to launch the startup, and so Cagney is said to not be in a rush to find his future funding.
A skilled fundraiser, Cagney nevertheless has pitched some of his biggest backers at SoFi, such as Thiel, DCM Ventures and Renren, according to one person familiar with the outreach. He has also sought out Wall Street banks and multiple other investors in the financial technology space — unaffiliated with SoFi — for advice, people said.
The deal is not yet final. Even though he has not yet raised the $25 million, several approached investors expect him to succeed given how much money he created for his previous backers.
Cagney's outreach is said to be aggressive and extensive — and given his controversial past, it has investors talking. He has not admitted any wrongdoing amid the news stories and lawsuits against SoFi, which helps students refinance student loans.
"The focus has shifted more toward litigation and me personally,," he said in a statement at the time of his resignation. "The combination of HR-related litigation and negative press have become a distraction from the company's core mission."
—By Theodore Schleifer, Re/code.net.
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