In their stock market debut on Thursday, Nubank’s shares started 25% above the offer price, giving the company a market capitalization of about $52 billion, making it Brazil’s third most valuable listed company.
The Sao Paulo-based fintech, which is backed by Warren Buffett’s Berkshire Hathaway Inc, is only behind commodities players Petrobras and Vale at that valuation.
Nubank raised over $2.6 billion in its initial public offering on Wednesday, pricing it at the top end of a range it had trimmed earlier owing to fears about a global crash in technology equities. According to one source familiar with the situation, the offer was eight times oversubscribed.
The IPO comes at a record year for U.S. listings, with heavyweights like Coinbase and Robinhood going public.
Nubank said that its Brazilian businesses made a profit in the first half of 2021. David Velez, the company’s founder, and CEO stated that the company will remain focused on three markets: Brazil, Mexico, and Colombia.
“Colombia and Mexico will receive a large portion of the funds raised in this IPO. As a result, we’ll continue to put our money into that growth opportunity, Velez stated in an interview with reporters.
Sequoia Capital, Tiger Global Management, and SoftBank Latin America Funds are among Nubank’s investors.
In an interview with reporters, Douglas Leone, global managing partner at Sequoia, remarked, “Nubank is one of those firms whose shares we might want to own for the very long term.” In 2013, Sequoia began investing in Nubank in the seed round.
“Right now, the focus is on making sure we (Nubank) do the best job we can for consumers throughout Latin America,” Leone, who also serves on the fintech’s board of directors, said.
Nubank, which has grown to become one of Brazil’s largest credit card issuers, has pioneered products that have sparked vigorous competition amongst competitors.
The company’s stock opened at $11.25 per share, up from $9 per share in the first public offering.
The offering’s primary underwriters are Morgan Stanley, Goldman Sachs & Co, Citigroup, and NuInvest.
