Business

Marqeta files S-1 as value tops $16 billion on private markets

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Marqeta is headquartered in Oakland, California.

Yalonda M. James | San Francisco Chronicle | Hearst Newspapers via Getty Images

Marqeta has grown into one of the hottest companies in digital commerce, although few consumers have ever heard of it.

His name becomes much better known. The company went public on Friday and announced in its prospectus to investors annualized revenue growth of 123% to $ 108 million in the first quarter, while net loss rose to $ 12.8 million from $ 14.5 million last year . USD decreased.

In 2020, annual sales more than doubled to $ 290.3 million and the company posted a loss of $ 47.7 million.

Marqeta was founded in 2010 and is based in Oakland, California. The company sells payment technology designed to detect potential fraud and ensure the proper routing of funds. The company issues bespoke physical cards that look like credit and debit cards and that DoorDash or Instacart contractors use to make checkout purchases in restaurants or supermarkets.

Many of Marqeta’s top customers have had record years as the pandemic shifted commerce to mobile devices. In addition to food delivery companies, Marqeta supports Square’s debit card for small business owners and the popular Cash app for peer-to-peer payments. Affirm and Klarna, who provide small dollar credit to consumers for purchases like bicycles and televisions, use Marqeta’s technology to move money around with their installment loans.

Larry Albukerk, who brokers pre-IPO shares on EB Exchange, said Marqeta shares trade for $ 33 to $ 35 each on the secondary market. Based on a total of 484.4 million Class A and B shares as listed in the prospectus, the company values ​​the company at approximately $ 16 billion to $ 17 billion.

A year ago, Marqeta raised capital valued at around $ 4.3 billion.

“It’s definitely one of the hottest companies in the private markets,” said Albukerk, who also owns several shares in Marqeta. “It’s been stable over the past two years and has recently become one of the most sought-after stocks to buy in front of the public.”

Albukerk said Marqeta is at the top with Stripe and Plaid on fin-tech stocks that investors seek, but Marqeta is the only one of the three to trade regularly because the other two companies are more restrictive on property transfers.

Marqeta competes on one side of the payment technology market with older providers such as Fiserv and FIS and on the other hand with modern providers such as Adyen and Stripe. Marqeta differs most through its card issuing service, which allows customers to create a very special physical or virtual card for their business partners.

The company says in the Risk Factors sections of its prospectus that its expansion in 2020 mirrored that of its customers in the e-commerce and grocery and grocery delivery sectors. As the economy reopens, spending patterns may change.

“Our net sales growth has increased over the past few periods as additional consumers have used these services,” the company said. “If this trend in consumer demand and spending patterns slows or reverses, as housing restrictions ease and the pandemic subsides, our net sales growth may be adversely affected.”

Marqeta was ranked 33rd on CNBC’s Disruptor 50 list last year.

CLOCK: Jason Gardner, CEO of Marqeta, on the partnership with Goldman

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Robert Dunfee