Affirm Holdings, a service providing installment loans for online shoppers, is looking to raise nearly $1 billion with an initial public offering, Bloomberg reports.
Why It Matters: Affirm had initially planned to go public in December but was tripped up by SEC delays. Now, as the first significant IPO of 2021, Affirm’s fortune is a clear indicator last year’s record public listings run is poised to continue. It comes right on the tail of IPOs from Airbnb and DoorDash, which capped off $179 billion worth of public offerings in 2020.
The company was founded in 2012 by Max Levchin, who you might remember as one of the co-founders of PayPal. While Levchin is the company’s biggest shareholder, other key investors include Jasmine Ventures, Khosla Ventures, Founders Fund, Lightspeed Venture Partners and Shopify Inc.
Numbers To Consider:
- Affirm is seeking to raise as much as $934.9 million in its IPO.
- The company plans to sell 24.6 million shares at a price between $33 and $38.
- Over 6,500 merchants use Affirm’s platform, and shoppers use the service to cover purchases at an annual interest rate of 0% to 30%.
A Closer Look: Affirm posted a $15 million net loss on $174 million of revenue in Q3. During the same period in 2019, it lost $31 million on $88 million of revenue.
- Peloton accounted for 30% of Affirm’s total revenue in Q3.
What’s Next: Affirm plans to make its trading debut on Jan. 13 under the ticker “AFRM.”
Given that I’ve seen Affirm consumer loans proliferating across ecommerce the last few years, this will be an interesting one to cover.