Affirm’s IPO pop shows that the 2020 IPO fever hasn’t yet broken. The buy-now-pay-later fintech startup founded and run by PayPal co-founder Max Levchin went public on the Nasdaq yesterday, after having postponed its initial IPO plans in December to raise its share price from $33–$38 to $49. In doing so, Affirm was aiming to avoid a situation in which it underpriced itself relative to market expectations and ended up leaving a large chunk of money on the table, as Airbnb and DoorDash did when they went public last month. But almost as soon as they began trading, Affirm shares shot up to $90.90, and ended the day at $97.24, nearly double the initial price. (In the process, the merchant platform Shopify ended up gaining $2 billion, thanks to its ownership of a stake in Affirm). Yesterday, in The Ticker, Mario Gabriele explained why, despite being one of several companies operating in the buy-now-pay-later space, investors seemed bullish on Affirm. But even those bulls were probably surprised by the size of the pop yesterday.
