SAN FRANCISCO, California: After months of muted IPO activity in the fintech world, digital bank Chime Financial reignited investor enthusiasm with a blockbuster debut on the Nasdaq.
Shares surged 59 percent on June 12, opening at US$43—well above the IPO price of $27—valuing the San Francisco-based firm at $18.4 billion.
At one point, the stock was trading at $39.90, extending a winning streak for tech IPOs and signaling a potential reopening of the capital markets for other high-growth startups.
“If well-received, Chime could help reopen the IPO window for other long-delayed unicorns,” said Kat Liu, vice president at IPOX. “A strong debut could trigger a domino effect, prompting other high-growth firms to accelerate their IPO timelines.”
The company and some of its investors raised $864 million by selling 32 million shares at a price above the marketed range. Despite the debut valuation being lower than its 2021 peak of $25 billion, the listing marks a strong return to public markets. Chime counts DST Global, General Atlantic, and ICONIQ among its backers and has raised $2.65 billion since inception, according to PitchBook.
Known for its no-fee accounts, early direct deposits, and mobile-first design, Chime has rapidly grown by targeting underserved consumers and younger users seeking alternatives to traditional banks. Its revenue model primarily relies on interchange fees from debit card transactions.
“We’re just scratching the surface on this enormous business opportunity we have today,” said Chime CEO Chris Britt in an interview with Reuters. He noted the company currently serves less than five percent of the 200 million Americans earning $100,000 or less — a segment Chime aggressively targeted, spending nearly $520 million on marketing in 2024.
“Our goal is to be the number one market share company in terms of primary accounts and recurring direct deposit accounts in that segment, and we’re not going to stop there,” Britt added.
Morgan Stanley, Goldman Sachs, and J.P. Morgan were lead underwriters for the IPO.
The success comes amid early signs of a broader market thaw. Circle, the stablecoin issuer, saw its stock quadruple after listing last week. Voyager, a space-tech firm, more than doubled on its first trading day Wednesday.
Still, market watchers warned against assuming smooth sailing ahead. “While this is clearly a strong IPO window now, there is no guarantee it will continue,” said Samuel Kerr of Mergermarket, citing ongoing uncertainty around trade policy.
Crypto exchange Gemini, Klarna, AI chipmaker Cerebras, and Medline are among the most anticipated IPO hopefuls keeping a close eye on Chime’s performance.