AMSTERDAM, Netherlands— Nium, a financial technology startup, told CNBC Wednesday that it has raised $50 million in new funding from investors and plans to launch an IPO within the next 18 months.
The fundraising round was spearheaded by an undisclosed Southeast Asian sovereign wealth fund and supported by venture capital firms BOND, NewView Capital, and Tribe Capital.
It estimates Nium’s value at $1.4 billion. This represents a 30% discount to its previous valuation of $2 billion, achieved in 2022 when the company last raised external venture capital.
Nium’s CEO and founder, Prajit Nanu, stated that the new capital would be used to expand its mergers and acquisitions strategy, with a focus on other growth-stage payment firms.
Nanu stated that his company’s down round was the result of a broader decline in public market valuations of fintech companies.
Fintech stock prices have plummeted in recent years due to macroeconomic pressures such as high inflation and rising interest rates.
“Being realistic, when we raised in early 2022, public markets were killing it,” Nanu stated. “The public markets have not been kind to fintech.” .
IPO in 18 months.
Nanu stated that, despite the lower valuation, he remains bullish on Nium’s growth story and believes the company will go public within the next 18 months, with a target flotation in the third or fourth quarter of 2025.
He went on to say that valuation isn’t a concern for him and that it doesn’t matter what price the company puts on its shares because markets are inherently volatile.
“Whether you go public for $1 billion or $5 billion, it doesn’t matter. Because the valuation is only determined when you are acquired or when you go public,” he explained.
He used the example of Stripe, which had a $95 billion valuation in the heady days of 2021 before being reduced to $50 billion and then increased to $65 billion in secondary share transactions.
Not interested in cryptocurrency.
Nanu stated that he is not interested in acquiring companies in the cryptocurrency space because he does not see merchant demand for crypto as a payment method.
“It’s on the very early side of infrastructure,” Nanu stated. “Nium in the end is a layer on top of a lot of banks in the world.”
“Banks have gone from, crypto is hot, to not crypto, to crypto,” he stated. “It’s not one shoe fits all.”
That’s despite a significant increase in the price of cryptocurrencies such as bitcoin, which has rallied on the back of renewed investor interest following the approval of spot bitcoin exchange-traded funds in the United States.
Bitcoin’s price has increased by approximately 150% in the last 12 months.
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