Private backed Payfare files for IPO on TSX

CPE News (2/8/2021) – Payfare Inc. has filed a preliminary prospectus in connection with a proposed initial public offering (IPO) of common shares with terms yet to be determined.

Payfare has applied apply to list its common shares on the Toronto stock Exchange (TSX).

The underwriting syndicate is being led by Stifel Nicolaus Canada Inc. Gowling WLG (Canada) LLP and Minden Gross LLP are acting as legal counsel for the company and the underwriters respectively.

Founded by Ryan Deslippe and Keith McKenzie, Toronto based Payfare is a fintech company offering mobile banking, instant payment and loyalty-reward solutions for Gig economy workforce. The Payfare Platform has been adopted by some of the world’s largest and most well-known global Gig Platforms including Uber, Lyft and DoorDash.

For the nine months period ended September 30, 2020, Payfare reported $10 million in revenues, $12 million in operating loss and $20 million in net loss.

Payfare currently has over 50 employees.

Payfare is primarily backed by private investors from Canada, USA, Asia and Europe.

Payfare’s broad base of shareholders also include employee shareholders. In May 2020, Payfare instituted a policy whereby employees are required to apply between 5% and 25% of their salary (depending on salary level) to purchase common shares at fair market value, or to exercise options. This resulted in a reduction of $1,663,786 in cash salary payments, the issuance of 1,072,325 common shares and the exercise of 6,541,773 options under the policy.

Prior to the completion of the offering, Payfare has 191,450,592 common shares issued and outstanding.

There is no shareholder or entity holding 10% or more of the outstanding shares. Deslippe, McKenzie, and CEO Marco Margiotta are largest unknown individual shareholders controlling 12,507,726 common shares, 12,640,344 common shares, and 5,148,828 common shares respectively.

In July 2020, Payfare secured a $5 million bridge loan from Petra Strategic Capital LLC and a further $2.5 million drawdown in February 2021. Portion of the proceeds of the offering will be used pay down the loan and any drawn down portion of the extension.

photo credit: Payfare