Mark Cuban-Backed banking app Dave to go public in $4 BLN Spac merger

Billionaire Mark Cuban-backed Dave said it would go public through a merger with a blank-check firm sponsored by investment firm Victory Park Capital, valuing the banking app at $4 billion. Dave is an app launched in 2017. It is used to help Americans avoid billions of dollars in overdraft fees charged by traditional banks. It currently has 10 million customers.

Due to the pandemic, companies such as Dave are rushing to capitalize on a boom in demand for online banking services. Chime, which is a Financial services start-up has also held preliminary talks with investment banks about launching a stock market flotation. This could value it at more than $30 billion. The deal with special-purpose acquisition company (SPAC), VPC Impact Acquisition Holdings III Inc, includes a $210 million investment. This is led by Tiger Global Management, with additional participation from Wellington Management and Corbin Capital Partners.

Norwest, Section 32, Capital One, The Kraft Group, SV Angel and The Chernin Group are the other investors of Dave. SPAC is a blank-check firm. This seeks to merge with a privately owned entity, a deal type that has become very common in the last year. This merger came after a lull in deal making. This is due to weak investor appetite and greater regulatory scrutiny and is expected to close later this year. Center view Partners LLC served as the exclusive financial advisor to Dave. Citigroup and Jefferies served as capital markets advisors to VPCC and co-placement agents on the investment.