Digital Bank Nubank Cuts Valuation Target From $55 Billion To $42 Billion

David Velez is the co-founder and CEO of Brazilian bank Nubank. Shot for US Forbes on March 5th, … [+] 2021 by photograher Gabriel Rinaldi.


Gabriel Rinaldi Photography

Brazilian digital bank Nubank amended its Form-1 with the U.S. Securities and Exchange Commission a week ahead of its initial public offering to reduce the price range of its shares from $10 to $11 each, to $8 to $9. Now the company is planning to sell 289.2 million shares, which will start trading on Dec. 8. 

This cut would bring their valuation down from an expected $55 billion to about $42 billion, which would still place it ahead of the world’s most valuable digital bank, European fintech Revolut, valued at $33 billion. Even with the lowered valuation, Nubank could be worth more than its largest domestic rival, Itau Unibanco, which has a market capitalization of $37.5 billion. 

The company did not directly respond to comment, but posted in its blog that it trimmed the price range to be “more aligned with the current conditions in the financial markets,” possibly referring to the recent tech stock sell off due to the rise in Treasury yields in the U.S. and the new coronavirus variant, Omicron. 

Fintech venture capital investments continue at a record-breaking pace, and nowhere is this more apparent than in the Latin American region. According to Crunchbase, this area is now home to more than 20 unicorns.

The company’s revenue for the first half of 2021 was more than $716 million, and had a net income of $13.7 million, excluding operations in Mexico and Colombia. In June Berkshire Hathaway

BRK.A
invested $500 million and Sands Capital led a $250 million investment. 

Goldman Sachs

GS
, NuInvest, Citigroup

C
and Morgan Stanley

MS
are the lead underwriters for the company’s offering.