The Fintech IPO Wave is Back!

Klarna's anticipated IPO has undeniably stolen the spotlight last week. This move isn't just about improving financials, although that's a big part of it. In H1 2024, Klarna reported $1.46 billion in revenue, marking a 27% year-over-year growth. More notably, it achieved its first quarterly profit in four years, posting an adjusted profit of $61.56 million for the first half of 2024.

These strong financial results have significantly impacted Klarna's secondary market performance. Its implied valuation has surged by 50% year-over-year, reaching $11.5 billion at the beginning of November. However, there's more driving this momentum than just numbers.

Since Trump's re-election, fintech stocks have seen a rapid resurgence, with substantial gains in just two weeks:
Affirm: +36%
PayPal: +10%
Sezzle: +93%
Coinbase: +60%

The rally reflects investor optimism for a friendlier regulatory environment, particularly regarding lending and crypto activities.

Now, analysts estimate Klarna's IPO valuation could range between $14.6 billion to $15 billion, with some sources suggesting a target as high as $20 billion. Based on Klarna’s annualized 2024 revenue projection of approximately $2.92 billion, here’s how the valuation multiples stack up:
Lower end: $14.6 billion / $2.92 billion ≈ 5x revenue
Higher end: $20 billion / $2.92 billion ≈ 6.8x revenue
For context, Affirm is currently valued at 8.9x, while Sezzle is at a staggering 12.5x. Klarna’s IPO, set against a backdrop of a fintech market rebound, could very well be the dam-breaker for other fintech listings.

And not just for Fintech

ServiceTitan Inc., a leading home services software company, is reportedly preparing to file for an initial public offering (IPO) as early as this week, with plans to go public before the year’s end, according to sources familiar with the matter.

Curious to see more about ServiceTitan and other upcoming IPO candidates? Check out our updated IPO Barometer—we’ve compiled the latest financial data, secondary market valuations, and IPO statuses for companies with strong liquidity on the secondary market.

Swiggy’s oversubscribed IPO

Food and grocery delivery giant **Swiggy'**s $1.4 billion IPO was oversubscribed by Friday, with institutional investors rushing in on the final day, marking India’s second-largest share sale this year.
Despite some analysts’ concerns about potential challenges post-listing, Swiggy proved them wrong with a strong debut—shares jumped 16.92% on the first day of trading. The listing valued Swiggy at $11.3 billion, a substantial leap from its secondary market valuation of around $7 billion just a month ago.
What can we say? just once again to mention our IPO barometer to check out.

Wait, we have More IPO news, but this is the last for today, I promise

Pony.ai has officially filed for an IPO on the Nasdaq Stock Exchange.

Alex Wilhelm of Cautious Optimism makes the math:
Pony.AI plans to raise $180 million by offering 15 million ADSs at a price range of $11 to $13. New investors have indicated on $75 million worth of ADSs in the offering (42% of the deal), and the company plans to raise an additional $153 million in a concurrent private placement. At the midpoint of the proposed range, Pony AI would command a fully diluted market value of $4.6 billion.
Pony did $24.7 million worth of H1 2024 revenue, putting it on a roughly $50 million run rate. However, the company’s results have been historically weighted towards to the back-half of the year. Meaning that it’s likely that Pony will best the $71.9 million it recorded in calendar 2023. Let’s call it $100 million in 2024 to be generous. At that revenue result for 2024, Pony would trade for around 46x revenues. That’s incredibly not-cheap, implying that investors are willing to buy into Pony’s potential more than they are into its trailing results. That’s bullish!
And not without precedent. WeRide’s H1 2024 revenues ($20.7 million), were smaller than what it recorded in H1 2023, a year in which WeRide saw just $55.3 million worth of top line. Let’s be generous and say that WeRide will manage to reverse its declining 2024 revenue results, and get to, say, $75 million worth of top line this year. That would put its $4.33 billion present-day valuation at a revenue multiple — loosely — of 58x.

SpaceX at $250B valuation

Elon Musk's SpaceX is preparing to launch a tender offer in December to sell existing shares at a price of $135 per share, two sources familiar with the matter said. The tender offer would value SpaceX at more than $250 billion, according to the sources.

Bytedance at $300B valuation

ByteDance is valuing itself at about $300 billion, after it recently approached investors about a share buyback program, according to two people familiar with the matter and a document viewed by Reuters.
ByteDance reached out to investors in recent weeks, offering a price of $180.70 per share, the people said. The current offer price is an increase of 12.9% from the per share price of $160 in their last buy back program.
The company mentioned, that their action isnot related with Trump election.

And CoreWeave at $23B valuation

CoreWeave closed a $650 million secondary share sale, raising its valuation to $23 billion—over three times last year’s.
To remind you, CoreWeave is also going public.

Databricks is raising

Databrick is not going public yet. Databricks considers raising cash to resolve employee stock squeeze. Thrive Capital is in talks to acquire about $1 billion stake in analytics software maker Databricks in a deal that would value the startup at about $55 billion
Before going public the company likely wants to show investors that a larger share of its revenue is tied directly to artificial intelligence to justify a valuation premium over Snowflake.

Stripe launches API for AI agents

By enabling LLMs to interact with its APIs, Stripe empowers developers to build applications where AI agents can manage financial tasks, from invoicing to payment collection.
This automation may considerably reduce operational friction, speed up service delivery, and open up avenues for real-time financial experiences.
With its support for platforms such as Vercel and LangChain, the SDK greatly simplifies the path from concept to deployment.

New Primary rounds

Cyera, a cloud cybersecurity firm, is finalizing a deal to raise new funding from early investor Accel. It would about double Cyera’s valuation to $3 billion from $1.4 billion just seven months ago.

Writer, the full-stack generative AI platform for the enterprise, today announced $200M in Series C venture funding at a $1.9 billion valuation.

Firefly Aerospace, the leader in end-to-end responsive space services, today announced it closed an oversubscribed $175 million Series D round at a valuation of more than $2 billion.

Anysphere (~d/b/a as Cursor) is in the process of raising a round at a valuation that could reach $2.5 billion.
Here’s Marina Temkin:
[Cursor’s parent company Anysphere] has seen its revenue grow from $4 million annualized recurring revenue (ARR) in April to $4 million a month as of last month, according to a person with direct knowledge of the company’s financials. The company is experiencing faster user adoption and growth compared to other coding assistant providers, another person said.
That means that Cursor is raising money today at a 50x revenue multiple.