Fintech General IPO
November 2, 2021
6 minutes read

Brazilian Fintech Giant Nubank Files For US IPO

Nubank “Nu Holdings”, a famous fintech giant based in Brazil, is stepping gradually towards an initial public offering (IPO) in…

Nubank “Nu Holdings”, a famous fintech giant based in Brazil, is stepping gradually towards an initial public offering (IPO) in the US. It’s unveiled its F-1 filing with the US SEC, showing its intent to raise around $3bn from its offering.

Nubank is a digital bank catering to the Latin American market. Founded in 2013, it’s grown ever since at breakneck speed and is the region’s largest fintech company. Nubank is notably one of the few startups backed by legendary investor Warren Buffet’s Berkshire Hathaway (NYSE: BRK.A).

Nubank’s IPO is long-anticipated, providing an opportunity to invest in the most valuable startup in Latin America (CB Insights data). The company’s F-1 filing offers great insight into its business, with information not publicly disclosed before. We’ve extracted important parts of that information, so you don’t have to, primarily financial metrics.

By The Numbers

Nubank brought in $737mn in revenue in 2020, compared to $612mn in 2019 and $319mn in 2018. That shows rapid growth, with revenue more than doubling between 2018 and 2020.

Nubank’s revenue is split reasonably between income from interest on its customer’s money and fees and commissions from facilitating financial transactions. For example, it brought in $383mn in revenue from interest income in 2020 and $354mn from fees and commissions in the same year.

In the nine months ended September 2021, Nubank brought in $1.06bn in revenue, double the same period a year ago.

Nubank isn’t profitable on a net basis, but its losses are small when paired against its rapid revenue growth. For example, it lost $99mn in the first nine months of this year and $64mn in the same period a year ago.

Nubank has 35.3 million monthly active customers. That number is significant, but it’s good to know that Latin America still has many millions more unbanked fellows representing a potential customer base.

Nubank is a fintech “super app” in its right. It’s akin to a whole bank with digital-only operations, where users use its app to make payments to each other, pay bills online, buy insurance and securities, and use Nubank-branded cards to shop.

Nubank is a lesson for American fintech counterparts to learn from, but the US and Latin America’s demographics aren’t the same, which may be an unfair comparison.

According to its F1 filing, Nubank will sell at least 289 million shares for $10 to $11 each, summing up to around $3bn. At the top range of that share price, Nubank is gunning for a valuation of about $50bn, greater than any Latin American bank.