The main screen of Affirm Holdings Inc. website on a laptop computer in a photograph taken in Little Falls, NJ, USA, on Wednesday December 9, 2020.
Gabby Jones | Bloomberg | Getty Images
The payment firm’s shares confirmed a more than 80 percent rise in its initial Nasdaq IPO, kicking off what is likely a busy season for its market debut.
The stock started trading at $ 90.90 per share.Affirm set the stock price at $ 49 a piece, higher than its target range of $ 41to $ 44 per share and sought to raise $ 1.2 billion.
Affirm, founded in 2013 by PayPal co-founder Max Levchin, has emerged as a standout in the area. “Buy Now, Pay Later” offers point-of-sale credit services. The company allows customers to finance their purchases online that can be repaid in monthly installments without paying compound interest.
It works with about 6,500 retailers, including Peloton, Wayfair, Walmart and direct-to-consumer eyewear company Warby Parker.In an update to the IPO filing, Affirm said it had more than 6.2 million users.It also confirmed that it was a partner. With Shopify last year, stores were able to offer installment loans for products they sold.
Affirm earned about $ 510 million for the fiscal year ended June 30, a 93 percent increase from the previous year, according to the filing. For the three months ended Sept. 30, revenues were up 98% year-over-year, while net losses halved to $ 15.3 million.
Insist on making money when they help merchants make sales It also earns interest on loans purchased from bank partners and some consumption loans. The rate charged will vary according to the reliability of the consumer. But usually starts at 0%
“Our goal is to be a great alternative to credit cards,” Levchin told CNBC before the company’s first trade.
Morgan Stanley, Goldman Sachs and Allen & Co are underwriting and distribution managers. Major investors include Peter Thiel’s Founding Fund, Khosla Ventures and Lightspeed Venture Funds.
Affirm’s market debut could mark another successful investment for Levchin, which owns 27.5 million shares in the online lender. After the PayPal sale to eBay in 2002, Levchin started the Slide Company, which was sold to Google in 2010 for $ 182 million.
Affirm, which trades under the symbol “AFRM,” has made two CNBC Disruptor 50 lists.
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