Blend Labs filed a confidential registration statement with the Securities and Exchange Commission on Friday, signaling its intent to enter the public markets.
The dropping of the S-1 closely follows the mortgage tech firm’s big venture capital raise in January, in which it raised $300 million in a Series G round from Tiger Global Management and others. That January round gave Blend a $3.3 billion valuation. It has raised a total of $655 million since its founding in 2012, according to Crunchbase.
Blend, which was named as one of HousingWire’s 2021 Tech 100 winners, has steadily grown to be a powerhouse in the mortgage tech industry. Blend’s white label technology is what powers mortgage applications on the site of banks such as Wells Fargo and U.S. Bank and integrated with CoreLogic in 2019 for an easier access line to borrowers’ credit.
The company, led by CEO Nima Ghamsari and President Tim Mayopoulos, said it had a record year in 2020 – more than 300 consumer banks use its technology to process more than $4 billion of mortgages and other consumer loans per day. In all, its technology platforms saw $1.4 trillion in mortgages and other loans in 2020, Blend said.
The digital lending software provider has even been breaking into adjacent businesses of late. In March, it announced the acquisition of Title365 from Mr. Cooper Group for approximately $422 million.
Should lenders look to non-QM when the refi boom slows?
HousingWire recently sat down with Tom Hutchens, Angel Oak EVP of production, who shared how non-QM lending could be an effective way for lenders to replace lost business in the event of a refi boom slowdown.
Presented by: Angel Oak
Blend’s S-1, however, revealed little about its upcoming IPO plans. It didn’t note how many shares would be sold or the price range. It also didn’t state which stock exchange it would be listed on or what the ticker symbol would be. When it will go public is also a mystery.
But that Blend is going public at all is interesting. Just a week ago, digital mortgage lender Better.com received a $500 million funding round from SoftBank, in what appeared to be a prelude to an IPO. The lender, led by Vishal Garg, is now valued at approximately $6 billion. The Wall Street Journal, which first published the $500 million investment, reported that SoftBank is buying out some existing shareholders and will hand all of its voting rights to Garg.
Doma, a title insurance firm, and digital lender SoFi are also both hoping to go public this year at valuations of $3 billion and about $9 billion, respectively.
If all those firms do manage to make it to an IPO, it will signal that the public markets have a greater appetite for digital mortgage lenders/platforms than they do more traditional mortgage players.
The public markets also haven’t quite embraced the more traditional nonbank mortgage lenders that have gone public over the last year – the stocks of Rocket Companies, United Wholesale Mortgage, Guild Holdings, loanDepot and others have largely remained level or fallen.
And some just didn’t make it before the window shut. The private equity owners of AmeriHome and Caliber Home Loans both envisioned taking the lenders public last year, but canceled the IPOs. Instead, the lenders were to be sold in private deals. Caliber is to be sold to publicly traded mortgage servicer and originator New Residential Investment Corp. for about $1.8 billion. AmeriHome was sold to Western Alliance Bank earlier this year for about $1 billion.
