NerdWallet files for an IPO
Personal finance site NerdWallet has filed for an IPO. The San Francisco-based company did not share terms for the offering, but according to Reuters it could seek a valuation of up to $5 billion.
Founded in 2009, NerdWallet provides financial guidance to consumers through educational content, tools and calculators, product marketplaces and the NerdWallet app. Topics include credit cards, mortgages, insurance, SMB products, personal loans, banking, investing and student loans.
For the first half of 2021, the company reached an average of 21 million monthly unique users. In terms of revenue, NerdWallet recorded a net loss of $26.8 million on revenue of $181.6 million for the same period.
The company has partnerships with several companies in the insurance space including Allstate, Answer Financial, bolt, Datalot, Esurance, Gabi, Jerry, Liberty Mutual, Metromile, Progressive, QuinStreet, QuoteWizard, The Zebra, and USAA. Recently, NerdWallet went beyond making money from insurance leads and clicks with the introduction of a phone service powered by bolt that allows users to compare and buy insurance. This move is part of a strategy of building recurring revenue streams.
“We believe the services provided by financial advisors, insurance agencies, loan brokers and others will increasingly transition online in the coming years, which will expand our addressable market. As a result of this offline-to-online shift, offline sales commission dollars will be reallocated to better align with the growth and importance of digital channels. To illustrate the growth potential of our addressable market, for example, the life insurance industry in 2019 spent $9 billion on advertising, of which $2 billion was digital advertising—yet, $13-$15 billion in commissions were still paid to agencies. As financial services providers modernize their approach to sales commissions and related compensation, we expect that our addressable market opportunity will continue to grow.” – NerdWallet.