U.S. payments startup Marqeta (MQ.O), which counts the likes of Uber and Stripe among existing backers, on Tuesday priced its initial public offering (IPO) well above the target range to raise $1.2 billion, the company said in a statement.
Marqeta sold 45.45 million shares at $27 per share. It had earlier set a price range of $20 to $24 a share.
On a fully diluted basis, which includes securities such as stock options and restricted stock units, Marqeta is currently valued at $15.23 billion, based on its IPO price.
The company had been valued at $4.3 billion when it raised $150 million from investors in May last year. Excluding employee stock options, Marqeta will have a market capitalization of $14.3 billion.
Marqeta’s IPO comes at a time when investors are betting big on high-growth fintech startups, which have received a boost during the COVID-19 pandemic that forced consumers to use more online financial services. A number of payments startups such as Flywire (FLYW.O) and Paymentus (PAY.N) have gone public in recent weeks.
Marqeta, whose customers include Uber Technologies (UBER.N), food delivery company DoorDash Inc (DASH.N) and payment firm Square Inc (SQ.N), previously disclosed that its revenue risen more than two-fold to $290.3 million in 2020 as homebound customers shopped more online.
Oakland, California-based Marqeta was launched in 2010 and helps companies issue credit and debit cards to their staff.
It offers a feature called “Just-In-Time Funding” that circumvents the need to maintain sufficient balances for each cardholder transaction. Funds are automatically transferred into the account at the time of the transaction.
Marqeta’s shares are scheduled to start trading on Wednesday on the Nasdaq under the symbol “MQ.” Goldman Sachs and J.P. Morgan are the lead underwriters for the offering.
Joanne Dewar, chief executive officer of Global Processing Services (GPS), the trusted super processor which has issued 170 million cards to-date, processed over 1.3 billion transactions in 2020, and has powered multiple fintech “unicorn” customers, including the likes of Revolut, Starling Bank and Curve, commented:
“While in the past few years there has been considerable investment and disruption in merchant acquiring, with the emergence of winners such as Stripe and Adyen, the role of the technology providers behind the cardholder side of the payments equation – otherwise known as issuer processors – has been largely overlooked, despite enabling many of the most innovative and valuable fintechs today.
However, that is beginning to change. The intrinsic value of issuer processors is increasingly being reflected by the post-M&A valuations of some of the biggest companies in the space, from SoFi’s $1.2 billion acquisition of Galileo and its recent SPAC merger taking its market cap to $16.9 billion, to SaltPay’s acquisition of Tutuka and its subsequent $700 million fundraise now valuing the company at over $1 billion. This is only further highlighted by retail investor interest in US-based Marqeta’s IPO, demonstrating that the year of the issuer processor has now arrived.
While the market opportunity is huge in the US, with issuers processing $6.7 trillion worth of transactions in 2020, our experience is that this opportunity stretches across the globe and could be almost five times that amount, given the rapid shift to digital payments adoption and increasingly cashless societies post-Covid.”
As background, GPS is the multi-award-winning, Visa-backed payments processing partner for marquee brands including Revolut, Starling Bank and Curve and has powered the growth of numerous global fintech unicorns and ‘soonicorns’.
GPS’ flexible and configurable platform supports a wide range of next-generation fintechs servicing specific market segments including digital banking & e-wallets, cryptocurrency, FX, lending and credit (including Buy Now Pay Later propositions), B2B, gaming, financial empowerment and more, from Treezor in France, Razer Fintech in Singapore, WeLab Bank in Hong Kong, right through to LayBuy in Australia & New Zealand.
GPS has also worked closely with Visa to deliver a showcase for the 2021 Tokyo Summer Olympics and is also certified by the payments giant and Mastercard to process and manage any credit, debit or prepaid card transaction globally, with offices in London, Newcastle, Singapore, Sydney and Dubai.