Could 2024 be the year of fintech IPOs? Most likely, according to F-Prime Capital's State of Fintech 2024 report.
F-Prime — a venture capital firm with over $4.5 billion in assets under management that tracks the performance of emerging, publicly traded and private fintech companies – remains naturally bullish on the fintech space, noting that: “In total, fintech companies have captured less than 10% of financial services revenue, but many large-scale private fintech companies generate more than $1 billion in revenue, continue to grow rapidly, and are expected to list on public markets.
“Many large companies are currently filing or considering going public,” F-Prime says.
To be clear, when F-Prime refers to fintech, it brings together fintech and crypto/blockchain startups. At TC, we have tended to separate our coverage of the two, even though crypto is undoubtedly fintech. However, for the purposes of this article, we are going to focus only on some of the non-crypto focused companies that have the potential to go public this year.
It remains to be seen whether any of these companies will actually take the plunge; we have to say, we'd love for one to file this S-1 to give us a better idea of how much money these companies are actually making (or not making).
As reported Dallas innovates Last December, “two years after attempting to go public via a SPAC merger that valued it at $4.7 billion post-money, Apex is looking to do it the old-fashioned way with a direct filing with the SEC …TThe stock liquidation company filed a confidential filing with the SEC, saying “the total number of shares to be offered and the price range of the proposed offering have not yet been determined.”
In January 2023, it was reported that Stripe had set a deadline of 12 months to go publiceither through a direct listing or to pursue a private market transaction, such as a capital raising and tender offer.
Well, it's been 12 months and we haven't heard anything about an IPO. But the payments giant raised more capital last year. Last March, Stripe announced that it had raised more than $6.5 billion in Series I funding at a valuation of $50 billion. It was previously valued at $95 billion, giving it the status of one of the most valuable private fintech companies in the world. In November 2022, Stripe laid off 14% of its workforce, or approximately 1,120 people. But fintech continues to diversify. Last June, TechCrunch reported that Stripe had acquired a (non-fintech!) startup and announced an expansion of its issuer product into credit.
Swedish fintech Klarna confirmed to TechCrunch last November that it was taking steps “toward a possible IPO.” The company said it had initiated a process of restructuring a legal entity to create a holding company in the UK, “as an important first step” in its IPO plans, according to a Klarna spokesperson. This decision follows a positive third quarter in which Klarna made a profit and reported 30% higher revenue of around $550 million. The creation of a new legal entity at the top of the company's corporate structure would allow it to be more easily listed on the stock exchange, the spokesperson added. Its most recent valuation was $6.7 billiondown 85% compared to Valuation of $45.6 billion he boasted about one year before.
Lendbuzz, a financial technology company applying artificial intelligence to provide auto loans to people with no credit history, in December »hired investment banks for an IPO this could value it at more than $2 billion,” as Reuters reports. In June 2021, TechCrunch reported that the the automobile financing platform had raised $300 million in debt financing and $60 million in financing.
Rumors have been circulating for some time that Chime is eyeing the public markets. Once valued at 25 billion dollarsthe neobank was initially, as TickerNerd reports, “all set for a March 2022 debut with a valuation between $35 billion and $45 billion,” but then the markets turned around. In November 2022, the company announced that it was laying off 12% of its workforce, or around 160 people. Recent reports assess the company's valuation to more than 6.7 billion dollarsand it is possible that Chime decides to take the plunge this year, given that it was planned for market entry late 2023, according to Investing.com.
Last October, TechCrunch reported that Plaid had hired former Expedia CFO Eric Hart becoming its first CFO – usually a crucial step for a private company moving into the public markets. Today, the company announced that it has hired Cloudflare Chief Product Officer Jen Taylor, to be its first president. When asked if the move meant the company planned to go public, a spokesperson told TechCrunch: “I can confirm that a possible IPO is a step we are moving towards, but we have no details or timeline to share. Beyond that.” Plaid got its start as a company that connects consumers' bank accounts to financial apps, but has since gradually expanded its offerings to provide a more comprehensive onboarding experience. It was almost acquired by Visa for $5.3 billion before regulators put the brakes on the deal – which some call a blessing in disguise.
THE HR technology space has become very hot, very fast and these three companies are among the hottest in the field. Undulating last March was able to secure $500 million in new financing while SVB melted. Last June, we discovered that Gusto in its most recent fiscal year (the 12 months ended April 30, 2023) had generated revenues of more than $500 million. In January 2023, Deel revealed that it had reached $295 million in annual recurring revenue (ARR) by the end of 2022. By November, this figure would have been reached. reached 400 million dollars. Interestingly, Rippling spoke about its rivalry with the other two companies. At TechCrunch Disrupt in 2022, CEO Parker Conrad spoke about Rippling being enter Deel territory. Even as early as 2020, Rippling attacked Gusto with a display panel stating: “Are you too big for Gusto? Change it quickly.
The spend management space is another crowded space with several players clamoring for market share, including Brex, Ramp, Airbase, Navan (formerly TripActions), and Mesh Payments, among others. So far, Navan is the only one to get this far confidentially file an IPO — at a valuation of $12 billion. But that was September 2022 and we haven't really heard about it since. Last December, the company laid off 5% of its staff, or 145 people. Brex, what was valued at $12.3 billion two years ago, had two rounds of layoffs over the past 18 months and would strive to reduce its cash burn. Ramp raised $300 million at a valuation 28% lower at $5.8 billion last August. So far, no staff have been laid off. When asked about IPO plans, CEO and co-founder Eric Glyman recently told TC that the company was “excited to potentially explore the IPO process, but does not have an active timeline on that.”
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