Personal Finance Startup NerdWallet Files For IPO
NerdWallet, a popular financial information website, has unveiled its S-1 paperwork filed with the US SEC for an initial public offering (IPO). It’s the latest fintech startup kickstarting a journey to the public markets at a time when investor sentiment towards public fintech companies is very favorable.
- NerdWallet is a popular online destination for financial advice and information pertaining primarily to Americans. It makes money from promoting financial products to its users and getting commissions when purchased, a very lucrative business, as the S-1 paperwork indicates.
- According to the S-1, NerdWallet has a big business that’s also profitable. The company posted $245mn in revenue and a small net profit of $6mn in 2020. In 2019, it posted $228mn in revenue and a $24mn net profit.
- However, in the first half of 2021, NerdWallet posted a net loss $27mn, though its revenue for the same period grew 32% year-over-year to $182mn. Basically, NerdWallet is a very solid business on solid standing, though its growth is not on steroid-like levels like some fellow fintech startups.
- Notably, NerdWallet has a dual-class share structure that gives the company’s founder and CEO, Tim Chen, 93% voting power, effectively in control of the company. It’s a controversial structure that’s been adopted by tech founders to keep control of their company despite listing them publicly, famously spearheaded by Facebook CEO Mark Zuckerberg.