Neobanks And Blockchain Firms Eye Public Listings

Incremental activity in public listings this past week – via traditional initial public listings (IPOs) and special-purpose acquisition companies (SPACs) – was focused on digital banking and even blockchain.

Planned IPOs in the banking and payments spaces helped lift those verticals to a respective 25 and 44 announcements year to date, as tracked by PYMNTS – representing the dominant sectors in terms of overall activity.

And it is the neobanks that hold sway in terms of projected deal sizes and valuations, at least for the moment. The activity has been international in scope, extending well beyond U.S. borders.

As noted in this space, the Brazilian neobank Nubank is readying an initial public offering (IPO) that might be worth more $2 billion by the end of the year. The company’s most recent capital raise of $400 million would value the company at $25 billion, with a customer base of 34 million individuals, which would make Nubank the largest independent online bank.

See Also: FinTech Company Nubank Eyes $2B IPO 

In another sign of the traction that digitization is gaining – both as a business model and as an investment vehicle – this past week, Cascadia Acquisition, a SPAC that was in turn formed by Cascadia Capital, has filed with the SEC to raise up to $150 million.

In the filing, the company stated that “we intend to concentrate on sourcing business combination opportunities in industry sectors that are being fundamentally reshaped by the introduction of advanced technologies, commonly referred to as ‘Industry 4.0.’ Today, Industry 4.0 is seen as the fourth industrial revolution, using the building blocks of computing and advanced technologies like artificial intelligence, deep learning, computer vision, the Internet of Things, gene sequencing, energy storage and blockchain, to transform the physical, digital and biological worlds.”

Mortgage Insurance, Too

Separately, Enact Holdings, a private mortgage insurance company in the process of being spun out of Genworth Financial, filed with the SEC for a public listing. In the filing, the company said that its revenues grew by 13 percent to $1.1 billion in 2020, as measured year over year. Enact cites its risk-based pricing engine, GenRATE, as a way to “quickly change price to modify our risk selection levels and respond to industry pricing trends.”

In a smaller deal, Abri SPAC I raised $50 million this past week, looking to focus on the FinTech and InsurTech industries.

And with a nod to the inroads blockchain is making into the mainstream, Hash Space Acquisition, which is based in China, filed with the SEC to raise $40 million through its own listing.  The company said in its filing that it intends to identify a target in the blockchain sector with an equity value of $100 million to $300 million.

“We believe that the application of blockchain technology in the global financial sector will accelerate the digitalization process of countries and industries around the world under the impact of many uncertainties such as political instability, economic cyclical fluctuations and potentially recurring COVID-19,” the company said in the filing.