Digital banking startup Chime pops on IPO 37% debut, raises $700M at $11.6B valuation

Chime opened strong on the Nasdaq Thursday, popping 37 percent to $43 after pricing its shares at $27. The digital banking startup raised around $700 million in its IPO, with early backers cashing out another $165 million. The stock is trading under the ticker symbol CHYM.

The IPO sets Chime’s valuation at $11.6 billion—less than half of its $25 billion price tag during the private market peak in 2021, when firms like Sequoia were pouring cash into high-growth fintech bets. But in today’s reset environment, that number still puts Chime among the most valuable consumer fintech companies to go public in years.

Chime’s offering is the latest in a small but growing wave of fintech IPOs. eToro and Circle made headlines recently with strong debuts of their own, signaling that investor appetite for public fintech stocks might be thawing after years on ice.

The IPO arrives as public market activity shows signs of life again. After a shaky April, investor appetite seems to be returning, helped along by a calmer stock market. The U.S. IPO window, which had briefly slammed shut due to tariff-related uncertainty, is starting to crack back open.

For the most recent quarter, Chime posted $518.7 million in revenue, up 32% year-over-year. Profit came in at $12.9 million, down slightly from $15.9 million a year earlier.

CEO Chris Britt said Chime’s growth stems from sticking to one audience: everyday Americans earning $100K or less. “Two-thirds of our customer base use us as their direct deposit account and primary account relationship,” Britt told CNBC. “We help our members avoid fees, get access to short-term liquidity, build their credit, and build their savings.”

Founded in 2013 by Britt and co-founder Ryan King, Chime built its name on fee-free banking. The app offers checking, savings, and a debit card, with revenue coming mostly from swipe fees every time a customer uses their card. The company doesn’t charge overdraft or maintenance fees, a stark contrast to traditional banks.

The road to IPO wasn’t smooth for Chime. The company faced layoffs in 2022 and ran into trouble with regulators in 2021, who barred it from calling itself a “bank.” But the toughest chapter came even earlier—before its Series B—when the startup nearly died. Britt has said more than 100 investors passed on Chime before it finally gained traction.

Its last private round was in 2021, when Chime raised $750 million at a $25 billion valuation. That’s a long way from today’s public pricing, but the downshift may have been strategic. In a market still cautious on fintech, a more grounded valuation can get the right investors in the door.

Britt said Chime reached $25 million in adjusted profitability last quarter and has improved its margin by 40 points over two years.

Major shareholders include DST Global, Crosslink Capital, and Iconiq, which first backed Chime in 2019 when the company was worth $1.5 billion. “We continued to invest through subsequent rounds because of their singular, unwavering focus on serving everyday Americans,” said Iconiq general partner Yoonkee Sull.

Usage metrics back that up. The average Chime customer completes more than 55 transactions a month and checks the app four to five times a day. Monthly active users hit 8.6 million in Q1, up 23% year-over-year.

But growth has come at a cost. Chime spent $1.4 billion on marketing from 2022 to 2024. Britt said retention remains strong, especially once users set up direct deposit, with more than 90% sticking around.

“Sometimes it takes a life change — a new job, a shift in career — to make someone switch their primary account,” Britt said.

Most of Chime’s revenue—72%, according to Britt—comes from interchange fees. That simplicity surprises some analysts. “I’m actually surprised by how unsophisticated that business model is,” said Mizuho analyst Dan Dolev.

Still, the public markets will now do the judging. If Chime holds up well, it could open the door for others like Klarna, Gemini, and Bullish, who’ve either filed confidentially or are eyeing the IPO window closely.

“If it goes well—and you’ll know that in two to three months—you’ll see others follow,” said David Golden, partner at Revolution Ventures and former head of tech investment banking at JPMorgan. “If not, they’ll stay on the sidelines.”