In a surprise turn of events, Elevate Credit has decided to postpone its initial public offering (IPO). Originally, the IPO was scheduled to take place on Thursday, January 21, but due to difficult market conditions the company decided against it.
The company planned to offer 3.6 million shares in an expected price range of $20 to $22, raising $75.6 million at an implied valuation of $638.4 million. Joint bookrunners for the offering were going to be UBS Investment Bank, Jefferies, Stifel and William Blair. The co-manager was going to be BB&T Capital Markets.
What would have been interesting about Elevate, besides the fact that it could have been the year’s first venture capital-backed IPO, was that it has been characterized as a payday lender that charges borrowers much higher interest rates than those available on other types of loans.
The company offers technology-driven online credit solutions to non-prime consumers. This is for consumers with credit scores of less than 700 and who are not well-served by either banks or legacy non-prime lenders.
Elevate currently offers online installment loans and lines of credit in the United States and the United Kingdom. Its products, Rise, Elastic and Sunny, have provided approximately $1.2 billion in credit to approximately 450,000 customers and generated strong revenue growth. They reflect its mission of “Good Today, Better Tomorrow” and provide customers with access to competitively priced credit and services while helping them build a brighter financial future with credit building and financial wellness features.
Unfortunately, investors will have to wait for this to hit the market, or at least when these prevailing market conditions clear up.
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