Opendoor leads FinTech IPO index down 0.7%
Earnings season has yet to fully engulf the FinTech IPO sector.
But there was plenty of other news to go around – where macro headwinds were evident, forcing at least one platform to scale back headcount.
Shares of Opendoor plunged 18.9% for the week, and the overall index was down 0.7% over that time frame.
Cutting staff — Again
The company said this week it was cutting about 560 jobs or 22% of its workforce. The latest move comes in the wake of the company laying off 18% of its workforce, then 550 jobs, back in November. In a statement email Real Trends that “We have been through a sharp transition in the housing market – the steepest and fastest interest rate increase by the Fed in 40 years, more than the doubling of mortgage rates from historically low levels, and the hit to housing affordability has led to approx. % decrease in new listings from peak levels last year. We are implementing these measures now to better align our operating costs with the expected market opportunity in the short term.”
As Reuters notedOpendoor had almost 13,000 unsold homes at the turn of the year out of around 35,000 homes bought in 2022.
Elsewhere, Lufax Holding listed shares in Hong Kong on April 13 and ended higher on its first day of trading, closing at HK$34.75 after opening at HK$33.50.
US listed stocks – included in our FinTech IPO group – lost 4.7% for the week.
nCino shares rose 1.4% over the past five sessions.
The company said so this week in South Africa, TUHF has chosen nCino’s cloud banking platform to improve the lending process for its customers and “support the entire credit lifecycle journey across its commercial loan book.” The release noted that by leveraging nCino’s cloud banking platform, TUHF will accelerate its lending processes and scale its operations efficiently.
Affirm and Stripe said they had expanded their partnership. As we noted at the time of the announcement, the extension makes Affirm’s Adaptive Checkout feature available to eligible Canadian Stripe users.
In this case, that means offering payment options that range from six weeks to 36 months and start at 0% APR, the release said, with no late fees. Affirm shares lost 4% over the past five sessions.
Nuvei shares gave up 3.4%, as short seller Spruce Point Capital Management LLC claimed, as described by Reuters, that the Paya acquisition masks Nuvei’s “growth challenges”.
Spruce Point issued a “strong sell” rating on Nuvei’s stock, estimating a long-term downside risk on the stock of 35% to 50%. Paya, the alleged short-selling report, has lost market share.
– Nuvei is exposed to declining inflation and consumption. Our analysis also suggests that the underlying economy is deteriorating and that it is heavily dependent on strengthening the share price as a tool to attract, retain and compensate employees, the report said, adding that Nuvei may have a stake in the bankrupt the crypto exchange FTX.
In separate Nuvei news, as spotlighted here, “Deadpool” actor Ryan Reynolds has invested in Nuvei. The investment came just weeks after Mint Mobile, a wireless carrier in which Reynolds held a 25% stake, was bought by T-Mobile for $1.35 billion. Reynolds also invests in American Aviation Gin and the UK’s Wrexham Football Club.
Shares in dLocal fell 3%.
In an announcement, the company said it launched a new all-in-one payment solution to manage global platform payments. The offering, dLocal for Platforms, is an end-to-end payment solution for marketplaces, on-demand services and other platform business models. dLocal for platforms, according to the release, onboards sellers, service providers or contractors on the platform itself, while dLocal gets them verified before disbursing funds. The platform can then accept payments on behalf of its users, divide the payments between one or more users, deduct costs as necessary and withhold money until payment. The company said funds could be moved within the platform to debit or credit funds.
