In its filing to the SEC on Thursday, OnDeck announced that it is seeking to raise up to $180 million via its initial public offering.
The company plans to sell 10 million shares for between $16 and $18. It also has the option to give underwriters the right to purchase up to an additional 1.5 million shares. At this price range OnDeck would be valued between $1.06 billion and $1.19 billion, with 66.2 million shares outstanding.
The release of these terms means that OnDeck can now begin to market its shares to investors. Current investors in the company include RRE Ventures, which owns 15%, Institutional Venture Partners, holding 14% and Village Ventures Inc., which owns 11%. SAP Ventures Inc. First Round Capital, Google Ventures and Tiger Global Management LLC also hold shares.
OnDeck has originated more than $1.7 billion loans over the past seven years and posted gross revenues of $107.5 million in the first nine months of this year. But the company is still not profitable as its losses grew to $14.4 million in the first nine months of this year.
According to its filing OnDeck plans to use the proceeds from its IPO for marketing, data analytics improvement, capital expenditure and to fund loans made to its customers. The alternative funder has increased the size of its IPO from $150 million when it first filed.
Currently, all attention is focused on the Lending Club IPO; its performance will give a strong indication of how investors will perceive the OnDeck IPO. Pricing these companies is very tough due to the lack of comparables. Although, Lending Club’s valuation is around 4 times that of OnDeck’s and the IPO is seeking to raise significantly more. It has also seen much higher volumes and has lent about $6 billion. Lending Club is expected to float next week and OnDeck is expected to come to market on the week of the 15th December.