Challenger bank and personal finance app Dave will become a publicly traded company through a merger with a blank-check company sponsored by Chicago-based investment firm Victory Park Capital at a valuation of $4 billion, the company announced Monday.
Dave, which says it has 10 million customers that use its personal finance tools, rolled out its digital banking product, Dave Banking, last summer. The company said it has 1.3 million customers using the digital banking platform.
Victory Park Capital provided a $100 million credit facility to Dave in January, the fintech said in a release.
Los Angeles-based Dave, which launched in 2017, started off as a personal finance tool to help customers budget and avoid overdraft fees. The fintech also has a job-search feature called Side Hustle, a product it says has helped users earn more than $150 million.
"At Dave, we’re committed to improving the financial health of our members," Dave CEO Jason Wilk said in a statement. "We believe the legacy financial system has failed to deliver, and today, more than 150 million people need our help to build financial stability. Dave is upending the banking industry with our suite of breakthrough financial products and making a meaningful impact on our customers’ lives. This transaction and continued support from our longstanding investors signify confidence in our strategy, vision and the significant growth opportunities ahead."
Dave’s special-purpose acquisition company (SPAC) announcement comes as the fintech has been broadening its commercial team over the past several months in an effort to expand its product suite and partnerships.
The company tapped former Coca-Cola and Airbnb marketing executive Jonathan Mildenhall for its newly created role of chief marketing officer in October, and brought on former Hulu executive Shannon Sullivan as the company's chief people officer.
"I have a history of working with big, splashy brands," Mildenhall told The Wall Street Journal in October. "I want Dave to be the biggest, splashiest, most aspirational and accessible fintech brand in the U.S."
The company also hired former lead Apple Card executive Jarad Fisher as the company's first chief commercial officer in February.
"We sort of started with one specific product, the overdraft protection, and are moving more toward a set of services that will help grow with our customers over time," Fisher told Banking Dive in February. "As opposed to building just a standard set of services, we decided to put the customer first and build around them. Hopefully that's how Dave will demonstrate that [it] is truly differentiated and will break away from the pack."
Challenger bank Chime, the nation’s largest digital bank, is reportedly also eyeing a public offering that would value the fintech at more than $30 billion.
The San Francisco-based neobank has held preliminary talks with investment banks about launching a stock market flotation as soon as the end of the year, according to Reuters.