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Monday, October 26, 2020

Affirm files confidentially to go public

This afternoon Affirm, a startup focused on providing point-of-sale credit to consumers making online purchases, announced that it has filed to go public.

The filing is confidential, so there’s little to be gleaned about the company’s performance from the news. That Affirm was exploring a public offering was reported by the Wall Street Journal back in July. In the aftermath of that news, TechCrunch tried to understand the valuation that Affirm was said to be targeting in its debut, which we placed at as much as $10 billion.

Affirm has been richly funded throughout its private life. The fintech unicorn has raised private funds in excess of $1 billion, including a $500 million Series G in September of 2020, a $300 million Series F in April of 2019, and a $200 million Series E in December of 2017. Affirm also raised more than $400 million in earlier equity rounds, and a $100 million debt line in late 2016.

Many venture bets are therefore riding on the success of Affirm and its future liquidity.

The company was valued at $2.9 billion at the time of its $300 million Series F last year according to PitchBook data. The company’s most recent valuation is not known. How much of a step-up a $10 billion public valuation would be, therefore, from its final private valuation is not clear.

Affirm will enter warm public markets if it chooses to list in short-order. The third quarter of 2020 was a bonanza of public-market liquidity, as the United States saw its most active quarter of public offerings since at least 2016, partially driven by the craze around SPACs. With retail investors and larger checkbooks alike active in their interest for growth-focused shares, unprofitable tech startups have done well in their recent debuts.

Those that make money have done even better, certain outliers like Snowflake aside.

After a confidential filing, Affirm will wait to hear back from the SEC on its application, and then will have the choice to file a nonconfidential S-1 when it is ready. There is no set timeline here, but once the company’s numbers are public, we’ll be diving into them. Affirm joins other recent companies like Palantir who filed their public offerings confidentially first, before later making them public.

This post courtesy of techcrunch

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