Brazilian Digital bank Nubank, owned by billionaire financier Warren Buffett, confidentially filed its Form-1 with U.S. Securities & Exchange Commission to offer an initial public offering. Once the SEC is finished reviewing the draft IPO, The company will likely go public with the U.S. by the starting of 2022.
With only $1 million of capital initially, sourced eight years ago by David Velez, the founder’sformer employer’s Sequoia Capital, Nubank has become a mighty force. Nubank’s revenue for the first quarter of 2021 was more than $716 million, and it has a net profit of $13.7 million with no activities in Mexico and Colombia. Berkshire Hathaway’s investment of $500 million in June boosted Nubank’s post-money value by $30 billion from $25 billion, making Nubank the second-highest valued digital bank, following European fintech Revolut which is valued at $33 billion. But that could soon be altering as the expected IPO could increase Nubank’s value to 55.5 billion.
The lender earns money primarily through interchange fees – the 5 percent of merchants who sell credit cards return to issuers and the banks. However, over the hardly few years, the organization has broadened its offerings of products, including personal loans, investment loans, immediate payments, life insurance, and international transfer.
To define the future direction of the business to shape the future of the company in the U.S. market, Nubank has recruited Morgan Stanley MS, Citigroup C, and Goldman Sachs GS. Nubank has been able to diversify its board members by hiring Brazilian pop star Anitta in June, and in the past, Muhtar Kent, the former Chairman, and CEO, is on the board for Coca-Cola.