After a delay, payment technology company Affirm Holdings Inc. is about to be paid.
The company, which allows people to buy goods and pay over time, priced its initial public offering at $ 49 per share on Tuesday, according to reports from Bloomberg News and Reuters. That price is $ 5 per share more than the top of its proposed range and would raise at least $ 1.2 billion and provide the company with an initial market capitalization of $ 11.9 billion, based on the company’s files. Affirm Securities Commission.
Affirm AFRM,
which was co-founded and led by PayPal Holdings Inc. co-founder Max Levchin of PYPL, allows customers to pay for online purchases over time. The company makes money on the merchant side of a transaction when consumers use one of Affirm’s installment products, the most profitable of which offers an “APR 0%” option that allows consumers to make purchases over time without incurring interest. The company also has a “simple interest” loan option, under which it charges consumers for prepayment.
Executives were expected to make Affirm public at the end of 2020, but ended up delaying the IPO after big first-day snaps among other so-called unicorns that went public, like Airbnb Inc. ABNB,
and DoorDash Inc. DASH,
To learn more: After a year of impressive pandemic offerings, these technology companies hope to keep it going
Affirm generated $ 509.5 million in revenue during its last fiscal year, which ended in June, compared to $ 264.4 million the previous year. The company recorded a net loss of $ 112.6 million, compared to a loss of $ 120.5 million in the same period last year.
Among the brands that use Affirm for installment options is Peloton Interactive Inc. PTON. The manufacturer of connected exercise equipment accounted for about 28% of Affirm’s revenue in its last fiscal year.
See also: Five things to know about Affirming as it goes public
Affirm is one of several players in the buy now-pay later space. Competitors include Afterpay Ltd. APT,
which markets in Australia; Klarna, who received support from Visa Inc. V,
; and Uplift, which focuses on the online travel market.
Affirm should now start trading on the Nasdaq exchange on Wednesday with the symbol “AFRM. “In the SEC filings, the company said it would seek to sell 24.6 million shares, and underwriters – led by Morgan Stanley, Goldman Sachs and Allen & Co. – have access to a supplementary lot comprising 3.7 million additional shares .
Affirm’s IPO comes as the Renaissance IPO ETF IPO,
gained 22% in the last three months and like the S&P 500 SPX,
increased by 7.6% during that period.