Markets: Mortgage Startup Blend Labs Files For IPO
One of the hottest fintech startups in the current markets is headed for a public listing soon. That startup is Blend Labs, a company that provides tools used by financial institutions to automate the process of issuing mortgage loans.
- Blend closed a funding round that valued it at $3.3bn early this year. Now, some months later, the company has unveiled an S-1 filing for an IPO with the US SEC. The final size of its share offering hasn’t yet been set.
- As usual, we’ll dig into Blend’s S-1 filing for some important bits on its business, particularly on revenue figures.
- Blend brought in $96mn in revenue for the year ended December 31, 2020. That revenue was up 89% from the previous year.
- On a net basis, Blend isn’t profitable, reporting a $75mn net loss in 2020 and $81mn in the year before that. But at least, it has high revenue growth rates to rationalize those losses.
- Blend’s business model is based on charging customers, usually financial institutions, for access to its mortgage processing and automation platform. It charges customers either on a periodical subscription basis or with usage-based arrangements.
- Blend says its platform processed $1.4 trillion in mortgage loans in 2020.
- Blend is a high-growth startup, founded in 2012. It has raised nearly $700mn in venture funding from investors including Coatue (5.8% pre-IPO stake), Formation8 (8.4%), Tiger Global (5.8%), and Lightspeed (13.3%).
- Blend intends to list on the New York Stock Exchange with the trading symbol “BLND”.
Photo: Blend Labs CEO Nima Ghamsari