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Got USD 38 to buy a share of Affirm?INTL

Got USD 38 to buy a share of Affirm?

San Francisco-based FinTech company Affirm is targeting up to USD 38 per share in their initial public offering, pushing their valuation to above USD 9b. The company, which offers loans in installments to online consumers at the buying stage, said it aims to raise up to USD 934.8m in the long-awaited IPO. Affirm, which has a Series A filing with the U.S. Securities and Exchange Commission, aims to offer 24.6 million shares at prices ranging between USD 33 and USD 38 per share.

You may know its founder Max Levchin, who co-founded the popular service PayPal with Peter Thiel way back in 2000. The FinTech firm has become a breakout star in the buy-now-pay-later trend, having reported a net revenue of USD 509.5m for the fiscal year ending on June 30, 2020.

why it matters
Some may argue that Affirm is overpricing their shares, especially considering how risky it is that nearly one-third of their revenues come from one merchant partner, Peloton (remember those static bikes everyone was buying back in the first round of lockdowns?), which may or may not continue to do well this year now that the vaccines are here to stay. But it is undoubtedly a good time to be a FinTech company trying to go public, as there has been a surge in the buy-now-pay-later industry – cue UAE-based Tabby, which recently raised USD 23m in private funding.