Marqeta Files For IPO

Marqeta, an Oakland, California-based firm that specializes in helping companies issue debit and credit cards to employees or contract workers, has filed with the federal Securities and Exchange Commission (SEC) to go public.

The filing was widely expected. Marqeta lists customers including Instacart, DoorDash and Square. The IPO could value Marqeta at about $10 billion.

Among business metrics contained in Marqueta’s S-1 statement filed with the SEC: $350 million in annualized net revenue based on fourth quarter 2020 data; more than 100 percent year-over-year growth in net revenue for 2020; and more than 320 million cards issued to date. According to the filing, Marqueta does business in 36 countries.

Explaining its business proposition in the S-1, Marqeta wrote: “As technology-centric organizations with novel business models and needs, such as Uber and Expensify, have gained popularity over the last decade, the inherent constraints of legacy issuing technology needed a new approach. Developers, technical product managers and visionary entrepreneurs desire the tools and infrastructure necessary to build their products to serve customers around the world. They require open, configurable and well-documented [application programming interfaces (APIs)] to embed advanced payment technologies natively into their platforms to programmatically authorize and direct these payment flows without needing to integrate directly with issuing banks and card networks. Open APIs have spurred innovation in previously entrenched industries.

“We built the Marqeta platform to address these needs. Our modern architecture allows for flexibility, a high degree of configurability and accelerated product development, democratizing access to card issuing technology.”

The S-1 also included a forecast for the expansion of digital payments that read, in part: “Digital commerce is increasing rapidly. Visa estimates that from 2016 to 2022, the share of global retail commerce conducted online is expected to more than double from 9 percent to 19 percent. Similarly, Euromonitor projects electronic payments will represent 46 percent of the total global transaction volume by 2025, up from 31 percent in 2017. We believe that the COVID-19 pandemic has accelerated these shifts to digital payments. Indeed, Bain & Company estimates that because of the effects of the COVID-19 pandemic, the percentage of global digital transaction volumes in 2025 will increase from 57 percent to 67 percent. According to McKinsey, a half-decade of change has happened in a few months as a result of the COVID-19 pandemic, with global cash payments dropping four to five times the annual decline rates seen over the last few years as consumers and businesses purchase a wider range of goods and services online.”