The banking app Dave announced on Monday that it would make its market debut through the merger of PSPC with VPC Impact Acquisition Holdings III.
The deal, which values ââDave at $ 4 billion, is expected to be finalized in the second half of this year. Once the trade is completed, it will be listed under the stock symbol DAVE. In a PSPC merger, the target companies are usually merged and the listing status does not change. VPCC is listed on the NYSE. Eligible companies can choose to change the exchange on which they trade. Dave has yet to officially indicate which exchanges should be made public.
According to data from PitchBook, the company, which ranked 26th on the CNBC Disruptor 50 list last year, had a recent valuation of $ 1 billion in August 2019.
Victory Park Capital, a Chicago-based global investment firm, has a long history of debt and equity financing transactions in the FinTech industry and has been a long-time investor in Dave, most recently in January 2021. We have a $ 100 million line of credit. VPCC completed its initial public offering in March 2021.
Dave (short for hero for the David vs. Goliath story) is designed to eliminate many features that customers can’t stand about traditional banking. The company started with an overdraft fee. With a monthly subscription of $ 1, users can access their checking accounts at no cost and with overdraft protection of up to $ 100 with no fees or interest. Members who sign up for direct deposits can also increase their credit score by automatically budgeting and reporting rent and utility payments to the credit bureau.
The company said it has helped clients avoid overdraft fees of nearly $ 1 billion through the Extra Cash feature and has helped workers earn more than $ 200 million from side businesses through the listing. jobs in the Side Hustle sharing economy. is lying
Co-founder and CEO Jason Wilk has founded three other start-ups and counts Mark Cuban as an early investor.
âAt Dave, we are working to improve the financial situation of our members,â Wilk said in a statement announcing the deal. âWe believe that a legacy financial system has not been realized. Today, more than 150 million people need our help to strengthen their financial stability. “
The transaction includes a $ 210 million private placement led by Tiger Global Management. What is known as PIPE financing is a mechanism by which a company raises funds from a selected group of investors which allows its entry into the end market. Wellington Management and Corbin Capital Partners are also participating.
PSPC has entered the market at a tremendous pace over the past year as an alternative to IPOs. However, the market has recently cooled due to regulatory concerns and the global recession in PSPC stocks. The CNBC SPAC 50 Index, which tracks the top 50 US-based pre-merger blank check transactions by market cap, has fallen around 4% so far, while the Nasdaq has risen by around 7%.
So far this year, 330 PSPCs have raised nearly $ 105 billion, according to SPAC Research, but experts have told investors that the recent enthusiasm and subsequent decline in PSPC shares is a riskier deal in the months to come. come. He warns that he can drive to.
correction: Dave has yet to officially indicate which exchanges should be made public.
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