Former PayBright shareholders to reap rewards from Affirm IPO

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By Ted Liu

On January 1, 2021, Affirm completed its previously announced acquisition of PayBright for up to CDN $340 million in cash and Affirm stock.

Founded by James Fox, Wayne Pommen, Dr. James Hyssen, PayBright is one of Canada’s leading providers of installment payment plans for e-commerce and in-store purchases. PayBright had raised over CDN $60 million from The Canadian Business Growth Fund (CBGF), iA Financial Group, and goeasy Ltd. (TSX: GSY)

As consideration for PayBright, Affirm disclosed that it paid CDN $136 million (US $106.7 million) in cash and issued to former shareholders of PayBright 3,622,445 shares of its common stock at closing and 2,587,362 shares of common stock issued in escrow and subject to forfeiture if certain revenue milestones are not met.

Affirm has filed for an initial public offering (IPO) priced at US $33-$38 per share at a valuation of between US $8.1-9.4 billion. Affirm is expected to commence trading on NASDAQ next week under symbol “AFRM.”

The total value for PayBright would be between US $312-343 million or CDN $396-435 million at the proposed IPO price range, assuming earn-out payment in full.

Affirm has raised US $900 million in venture funding from investors including Thrive Capital, Fidelity Management and Research Company, Baillie Giford, Wellington Management Company LLP, Sound Ventures, Founders Fund, GIC, Spark Capital, Lightspeed Venture Partners, Moore Asset Backed Fund, LP and Ribbit Capital.