Waiting For The Fintech IPO Wave

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Is fintech set for an IPO wave? Bloomberg‘s Julie VerHage raises the question in a newsletter as

there are now close to 30 private fintech startups with valuations at or above $1 billion, but a few of them are increasingly cited as possible IPO candidates.

In the past, fintech ventures haven’t fared too well, Julie VerHage argues as she asks:

The question now is what happens to those billion-dollar-plus valuations when the public gets a look at the companies’ financials and growth projections. (…) Based on where some funding rounds have priced fintech companies, the trend of lower valuations in the public markets seems likely to continue.

A New York-based venture capital fund FinTech Collective, quoted by the tech and business reporter, wrote in a recent newsletter to clients:

Large fintech IPO  valuations remain at a substantial premium to more mature, publicly traded fintech comparables and legacy financial services players leaving them susceptible to a steep fall if macro conditions falter.

Of course,  the journalist concludes,

a share price tumble for fintech’s new public market entrants this year is by no means guaranteed—but heightened investor scrutiny is.

 

 

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