Chime Upcoming IPO: Potentially banking on a 2025 IPO

Shortly after the Covid-19 pandemic triggered an economic contraction, the U.S. economy roared back, with near-zero interest rates and sky-high consumer demand helping to fuel valuations to new heights. One company that rode this wave was Chime, a fintech startup that has been a pioneer in digital banking with its essentially no-fee model.

In less than two years, from December 2019 to August 2021, Chime more than quadrupled its valuation, going from $5.8 billion to nearly $25 billion.³ By the beginning of 2022, Chime was reportedly gearing up for an IPO with the help of Goldman Sachs, with an IPO valuation that was expected to possibly reach almost $40 billion.⁴

However, just a few months later, the tide turned; as the stock market tumbled and IPOs cooled, Chime put its plans to go public on hold.⁵

Now, however, after going through a reset in its valuation like many other tech startups, Chime appears to be back on track toward an IPO. In September 2024, Bloomberg reported that Chime tapped Morgan Stanley to lead its IPO in 2025,⁶ and in December, Bloomberg reported that Chime has confidentially filed for an IPO.⁷

Chime: Company background

Chime is a fintech company that started in 2012 and is perhaps best known for its online checking account offering that has no monthly service fees, minimums, or overdraft fees. Technically, Chime is not a bank — it's a tech company that works with partner banks (currently Stride Bank, and The Bancorp Bank, both FDIC-insured) to provide deposit accounts to customers.⁸

Chime was co-founded by Chris Britt and Ryan King. Britt's background includes serving as chief product officer at Green Dot (which offers products like prepaid debit cards) and senior product leader at Visa.⁹ King's background is in tech, having worked as VP engineering and COO at Plaxo, a startup acquired by Comcast.¹⁰

Bringing low-cost digital banking to the masses

Millions of Americans pay to keep their money in a bank account and then get hit with excess fees such as overdrafts. In fact, 27% of Americans with a checking account are paying some form of monthly fees, whether that's a recurring maintenance fee or ones like ATM or overdraft fees. Of those fee-paying account holders, the annual cost averages $288, according to a Bankrate survey.¹¹

Chime is a leader of a new wave of fintech providers that are trying to disrupt this issue with traditional banking, with Chime's business model based primarily on interchange fees — i.e., the swipe fees merchants pay when consumers use credit or debit cards — rather than making money on account-related fees.¹²

That's not to say Chime is completely fee-free — there are out-of-network ATM fees, for example.¹³ But for the most part, Chime is trying to appeal to low- and middle-income Americans who want a banking experience and related financial products that help them keep more of their money and improve their financial position.

This approach has been working in the sense that Chime brought in about $1.3 billion in revenue in 2023, a 30% gain over the previous year. Of this revenue, over $1 billion was gross profit, but Chime ended up losing around $200 million for the year, due in part to about $270 million in marketing spend. However, Chime said it was profitable in Q1 2024, according to Forbes.¹⁴

Chime has over 38 million customers, which is more than competitors like SoFi, Dave, MoneyLion and Current combined, according to Cornerstone Advisors.¹⁵ And Chime has an 8.1% market share of Americans' primary checking account — a higher share than large banks like JPMorgan Chase and just behind Wells Fargo.¹⁶

Recently, Chime has started to expand into lending, and the company is reportedly eyeing other products like retirement accounts in the future, according to Forbes.¹⁷

Chime stock price history

Chime's Forge Price is $24.87 as of mid-December 2024.¹⁸ This marks a 52% recovery from its $16.4 Forge Price approximately a year ago, but it's still down 64% from Chime's last primary funding round in 2021, which had an issue price of $69.07.¹⁹ Forge Price is a derived data point that reflects the up-to-date price performance of venture-backed, late-stage companies, and is calculated based on a proprietary model incorporating pricing inputs from primary funding round information, secondary market transactions, and indications of interest (IOIs) on Forge.

In comparison to Chime's recent partial recovery, the Forge Private Market Index — a broad measurement that reflects the up-to-date performance and pricing activity of venture-backed, late-stage companies that are actively traded in the private market — is up 5% over the past year, while on a three-year basis it's down -52.6%, reflecting that many tech companies like Chime suffered steep valuation cuts after a run-up in 2021.²⁰

Chime funding history and private market valuation

Chime has raised nearly $3 billion from primary funding rounds over the past 11 years. Its seed round in 2013 kicked off its valuation at $7.26 million, with investors such as Homebrew and IrishAngels joining in. In 2017, Chime's Series B brought the company's valuation up to $61.33 million, bringing in prominent investors such as Cathay Innovation, Omidyar Network, and Northwestern Mutual.²¹

Chime reached unicorn status with its Series D in 2019, raising over $400 million at a post-money valuation of $1.5 billion, adding investors such as DST Global, General Atlantic, and Dragoneer Investment Group. Its last primary funding round came in 2021, when its Series G raised $1.1 billion at a valuation of $24.93 billion, with large investors such as Sequoia Capital, SoftBank, and Tiger Global Management participating.²²

Looking ahead

While this is not Chime's first reported foray into testing the IPO waters, it has reportedly taken the important step of confidentially filing, and many experts are optimistic that the market will be more conducive to IPOs in 2025.²³ If that holds, then Chime could be going public soon.

Check back here or take a look at Forge’s upcoming IPO calendar to stay in the loop about a possible Chime IPO and other pending public offerings.

If you’re interested in investing in private companies like Chime before they go public, read more about pre-IPO investing or register on Forge Markets today to get started.