1. Comment
  2. Comment
February 24, 2022

Fintech listings will continue to stand out in 2022

In 2021, fintech-related companies delivered one of the most successful initial public offerings (IPOs) of all themes. Between 2018 and 2021, the number of fintech IPOs has increased more than three times. Over the period, IPO proceeds from fintech have quadrupled.

Between 2018 and 2020, there were 56 IPOs where fintech was the primary thematic driver. 2021 alone saw 40 fintech listings and total IPO proceeds stood at $29.3 billion. Q2 2021 accounted for the highest number of fintech deals in 2021, with a total of 16 TMT IPOs, raising total proceeds of $12.6 billion.

According to GlobalData, it has been the most lucrative theme for investors in TMT IPOs over the last four years, generating the second-highest investor average return of 621%. Fintech companies are also taking non-traditional IPO routes. In 2021, nine fintech companies combined with a special purpose acquisition company (SPAC) to go public.

The biggest fintech IPOs of 2021 by proceeds raised

In 2021, the notable companies that went public with significant IPO proceeds included Nubank, Paytm, SoFi, Allfunds, and Paysafe.

Nubank

Nubank is a digital bank—which is backed by Warren Buffett’s Berkshire Hathaway—that listed in New York on December 9, 2021, raising $2.6 billion. The IPO valued the company at $41 billion and the proceeds will be used for further acquisitions.

Paytm

India’s online payments company Paytm made its debut on NSE India on November 18, 2021. The IPO raised proceeds of $2.5 billion, with an offer price of $27 per share. The company achieved a valuation of $14.5 billion. All proceeds will be used to expand its existing business lines and acquire new merchants. The company is diversifying to become a super app and has already ventured into gaming, hotel booking, and cryptocurrencies.

SoFi

Online finance company SoFi went public by merging with Social Capital Hedosophia and was listed on the Nasdaq on June 2, 2021. It raised proceeds of $2.4 billion and achieved a valuation of $8.7 billion. It is also offering cryptocurrencies.

Allfunds

Madrid-based fund distribution firm Allfunds was listed on Euronext Amsterdam on April 23, 2021. The IPO proceeds were $2.2 billion, with an IPO issue price of $13.4. This valued the company at $8.4 billion at the time of the IPO.

Paysafe

Paysafe is another online payment company that made its debut in New York with $2.1 billion proceeds on 20 April 2021, merging with Foley Trasimene. It achieved a valuation of $9 billion.

The US hosts most fintech IPOs

The US has emerged as the land of fintech IPOs. The US accounted for 58% of global fintech IPOs and 67% of total fintech IPO proceeds, since 2018. In 2021, six of the top 10 fintech IPOs were on US exchanges. Nubank is the most valuable fintech IPO in the US followed by SoFi, Paysafe, Robinhood, Affirm, and Marqeta.

The upcoming fintech IPO pipeline looks strong

The next two years will be huge for fintech IPOs as a number of major fintech companies have lined up their listings. We will see big fintech unicorns such as Klarna, Chime, and N26, go public in Sweden, the US, and Germany, respectively, in 2022.

Klarna

Klarna, the Swedish fintech company is planning to go public in Sweden in the first half of 2022 and is expecting to value at $125 billion. It has recently raised over $639 million from Softbank and others at a valuation of over $45.6 billion.

Chime

Chime, the digital banking company is planning to go public in the US in the second half of 2022, with an estimated valuation of $40 billion. It was last valued at $25 billion in January 2022, after raising $750 million from SoftBank, Sequoia Capital Global Equities, and other investors.

N26

The German fintech company, N26, is planning to go public in Germany in the next 12 to 18 months. N26 was last valued at $9 billion when it raised $ 900 million in October 2021.

The fintech pipeline for future public listings is expected to remain robust over the next two years. Apart from these three, we will also see fintech companies like eToro Group, Pagaya Technologies, Better.com, Dave, FinAccel, and Kredivo go public through SPAC combination IPO.