Fintech

Nubank’s IPO is about more than just raising cash

The Brazilian neobank’s IPO could be one of the largest offerings of the year. But co-founder Cristina Junqueira says it could have a more profound meaning for her customers.

Nubank co-founder Cristina Junqueira

Nubank co-founder Cristina Junqueira says she’s proud of what her neobank has accomplished.

Photo: Nubank

Nubank, which began trading on the NYSE today, isn’t just going public to raise money: It’s also looking to use the event of its IPO to spread stock investing to retail investors in its home market of Brazil.

That’s a point of pride for Cristina Junqueira, co-founder of Nubank and CEO of its Brazilian unit — and it demonstrates how companies, particularly in the financial sector, can think about listing shares as more than just a financing event.

Through a dual listing in Brazil and the U.S., about 800,000 people, or one out of four Nubank customers with investment accounts, bought Nubank shares. In addition, the company plans to distribute free shares to about 7.5 million customers through its financial education program NuSocios, which could effectively triple the number of equity investors in Brazil, she said. (People who participate in NuSocios get one-sixth of a Class A share, which can be traded after one year.)

“We’re very excited about the impact this is going to have on the country,” she said. “Equities are a big source of wealth creation for a lot of families. It was something that was completely inaccessible for Brazilians.”

The move is the latest example of the company branching out beyond its roots to become an all-in-one financial app for consumers. Nubank, founded in 2013, started with no-fee credit cards but now offers a variety of other financial services, such as bank accounts, debit cards, personal loans, small business accounts and “buy now, pay later” in Brazil, Mexico and Colombia.

Financial super apps have been popular in China, India and Southeast Asia, and it’s a strategy that American companies like PayPal, SoFi and Block have been pursuing.

Nubank at the New York Stock Exchange Nubank executives and employees celebrate at the New York Stock ExchangePhoto: NYSE

The promise that consumer fintech companies that start out in one niche can spread to others, diversifying their revenue and broadening their customer base, has drawn considerable interest from private and public investors. U.S. neobank Chime is also expected to list its shares in 2022.

Nubank is able to leverage data to help cross-sell and improve its products, Junqueira said — for example, when it moved from credit cards to personal loans.

Nubank, which began trading on the NYSE today, raised $2.6 billion, at the top of its IPO range, Wednesday night. Its shares started trading at $11.63, and though they fell to close at $10.33, it’s still worth a bit over $50 billion. The IPO made Nubank the most valuable financial firm in Latin America, according to Bloomberg.

Nubank’s journey to building a financial super app did not happen overnight. Founded in 2013, it began offering credit cards in 2014, which are data-rich and not capital intensive, Junqueira said, allowing Nubank to build a brand. But it wasn’t until years later that it felt ready to roll out other products.

“We always knew that we're going to go beyond that because we define our mission as finding complexity for people but what we wanted was to earn the right to do the next thing,” she said. “So for four years, almost five years, the only thing that we did was credit cards.”

Next came savings accounts, debit cards and personal loans. It now has a marketplace where it features financial products like shopping, remittances, home equity loans and auto loans. It also offers insurance.

She credits the pandemic with accelerating its growth, and giving Nubank a chance to differentiate itself further. Junqueira points to Nubank’s quick adoption of Brazil’s Pix mobile real-time payments system. (Brazil has done more digital real-time payments by volume than the U.S. this year as of October 2021, per ACI Worldwide.)

Nubank is known for reaching customers that are unbanked, and that is a focus for the company. But it is also now competing directly with banks, Junqueira said.

“[Banks] were always our competitors, right?” she said. “Because the vast majority of our customers were in some shape or form with them. There's some people that we're bringing in [who are] completely new and unbanked.”

Others were “just underbanked” — and “unsatisfied,” she added.

Update, Dec. 9, 2021: This story has been updated to include Nubank's closing price.

Climate

The West’s drought could bring about a data center reckoning

When it comes to water use, data centers are the tech industry’s secret water hogs — and they could soon come under increased scrutiny.

Lake Mead, North America's largest artificial reservoir, has dropped to about 1,052 feet above sea level, the lowest it's been since being filled in 1937.

Photo: Mario Tama/Getty Images

The West is parched, and getting more so by the day. Lake Mead — the country’s largest reservoir — is nearing “dead pool” levels, meaning it may soon be too low to flow downstream. The entirety of the Four Corners plus California is mired in megadrought.

Amid this desiccation, hundreds of the country’s data centers use vast amounts of water to hum along. Dozens cluster around major metro centers, including those with mandatory or voluntary water restrictions in place to curtail residential and agricultural use.

Keep Reading Show less
Lisa Martine Jenkins

Lisa Martine Jenkins is a senior reporter at Protocol covering climate. Lisa previously wrote for Morning Consult, Chemical Watch and the Associated Press. Lisa is currently based in Brooklyn, and is originally from the Bay Area. Find her on Twitter ( @l_m_j_) or reach out via email (ljenkins@protocol.com).

Every day, millions of us press the “order” button on our favorite coffee store's mobile application: Our chosen brew will be on the counter when we arrive. It’s a personalized, seamless experience that we have all come to expect. What we don’t know is what’s happening behind the scenes. The mobile application is sourcing data from a database that stores information about each customer and what their favorite coffee drinks are. It is also leveraging event-streaming data in real time to ensure the ingredients for your personal coffee are in supply at your local store.

Applications like this power our daily lives, and if they can’t access massive amounts of data stored in a database as well as stream data “in motion” instantaneously, you — and millions of customers — won’t have these in-the-moment experiences.

Keep Reading Show less
Jennifer Goforth Gregory
Jennifer Goforth Gregory has worked in the B2B technology industry for over 20 years. As a freelance writer she writes for top technology brands, including IBM, HPE, Adobe, AT&T, Verizon, Epson, Oracle, Intel and Square. She specializes in a wide range of technology, such as AI, IoT, cloud, cybersecurity, and CX. Jennifer also wrote a bestselling book The Freelance Content Marketing Writer to help other writers launch a high earning freelance business.
Workplace

Indeed is hiring 4,000 workers despite industry layoffs

Indeed’s new CPO, Priscilla Koranteng, spoke to Protocol about her first 100 days in the role and the changing nature of HR.

"[Y]ou are serving the people. And everything that's happening around us in the world is … impacting their professional lives."

Image: Protocol

Priscilla Koranteng's plans are ambitious. Koranteng, who was appointed chief people officer of Indeed in June, has already enhanced the company’s abortion travel policies and reinforced its goal to hire 4,000 people in 2022.

She’s joined the HR tech company in a time when many other tech companies are enacting layoffs and cutbacks, but said she sees this precarious time as an opportunity for growth companies to really get ahead. Koranteng, who comes from an HR and diversity VP role at Kellogg, is working on embedding her hybrid set of expertise in her new role at Indeed.

Keep Reading Show less
Amber Burton

Amber Burton (@amberbburton) is a reporter at Protocol. Previously, she covered personal finance and diversity in business at The Wall Street Journal. She earned an M.S. in Strategic Communications from Columbia University and B.A. in English and Journalism from Wake Forest University. She lives in North Carolina.

Climate

New Jersey could become an ocean energy hub

A first-in-the-nation bill would support wave and tidal energy as a way to meet the Garden State's climate goals.

Technological challenges mean wave and tidal power remain generally more expensive than their other renewable counterparts. But government support could help spur more innovation that brings down cost.

Photo: Jeremy Bishop via Unsplash

Move over, solar and wind. There’s a new kid on the renewable energy block: waves and tides.

Harnessing the ocean’s power is still in its early stages, but the industry is poised for a big legislative boost, with the potential for real investment down the line.

Keep Reading Show less
Lisa Martine Jenkins

Lisa Martine Jenkins is a senior reporter at Protocol covering climate. Lisa previously wrote for Morning Consult, Chemical Watch and the Associated Press. Lisa is currently based in Brooklyn, and is originally from the Bay Area. Find her on Twitter ( @l_m_j_) or reach out via email (ljenkins@protocol.com).

Entertainment

Watch 'Stranger Things,' play Neon White and more weekend recs

Don’t know what to do this weekend? We’ve got you covered.

Here are our picks for your long weekend.

Image: Annapurna Interactive; Wizard of the Coast; Netflix

Kick off your long weekend with an extra-long two-part “Stranger Things” finale; a deep dive into the deckbuilding games like Magic: The Gathering; and Neon White, which mashes up several genres, including a dating sim.

Keep Reading Show less
Nick Statt

Nick Statt is Protocol's video game reporter. Prior to joining Protocol, he was news editor at The Verge covering the gaming industry, mobile apps and antitrust out of San Francisco, in addition to managing coverage of Silicon Valley tech giants and startups. He now resides in Rochester, New York, home of the garbage plate and, completely coincidentally, the World Video Game Hall of Fame. He can be reached at nstatt@protocol.com.

Latest Stories
Bulletins