Fintech startup Plastiq to go public via $480M SPAC merger

Fintech startup Plastiq Inc. on Thursday Announced plans to go public by merging with Colonnade Acquisition Corp., a special purpose acquisition company.

A SPAC is a company created specifically to take another company public. You start the process by listing your shares on a stock exchange. It is then merged with a private company, and once the transaction is complete, that company goes public.

Following its merger with Colonnade, Plastiq will go public with an implied estimated enterprise value of approximately $480 million. The company expects to add about $320 million to its balance sheet through the transaction. The capital will provide “significant capital flexibility for continued organic and inorganic growth,” the company said.

San Francisco-based Plastiq has raised more than $140 million in funding from a group of investors that includes Kleiner Perkins. The startup provides a cloud-based platform that small and medium-sized businesses use to pay suppliers.

Their platform allows businesses to make payments to vendors using a variety of methods and includes a dashboard that makes it easy to track expenses. It also offers several related features, including the ability to access short-term financing. The platform can automatically sync transaction details with a company’s accounting application to reduce the need for manual data entry.

The company offers a second product, Plastiq Accept, that vendors can use to accept payments from business customers. For e-commerce market operators, the startup offers a tool that simplifies the task of processing business-to-business transactions. It says its built-in cybersecurity and regulatory compliance features reduce the amount of effort involved in processing such transactions.

Plastiq expects to close its fiscal year 2022 with net income of $75 million. Next year, the company projects that its net income will reach 105 million dollars. It says it has “helped tens of thousands of companies” streamline their accounting operations since its launch in 2012.

“For too long, SMEs have been neglected in financial services,” said Eliot Buchanan, CEO of Plastiq. “As a public company, we plan to continue to invest in opportunities to scale the business with a growing suite of products that allow us to provide SMB owners with access to sufficient on-demand cash flow, which is a critical component in growing their businesses. .”

Plastiq expects to complete its merger with Colonnade in the first quarter of 2023 subject to closing conditions. The current management team will continue to lead the company after its debut on the stock market.

Image: Plastiq

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