July 16 (Reuters) - Shares of Blend Labs Inc opened
11% above their offer price on Friday, giving the digital
banking platform a valuation of about $4.4 billion in its stock
Digital channels for banking services have experienced an
uptick in demand since last year, when the pandemic accelerated
the shift away from brick-and-mortar branches.
The market cap of the company, which is focused on
mortgage-lending, is now at least 33% more than the $3.3 billion
it was valued at after a funding round in January.
Blend is a cloud-based software platform that digitizes
banking and makes the borrowing of money or depositing cash
easy. On average, more than $5 billion in transactions are
processed through its platform every day.
"There will be a short-term headwind when interest rates
start coming up, but the general trend towards digitization will
help the company in the long term," said co-founder and head
Nima Ghamsari in an interview with Reuters.
Rising interest rates often lead to high loan rates, which
could hurt appetite for borrowing and dampen the volume of
transactions on Blend's platform.
The company plans to focus on its core market, the United
States, and has no immediate plans to expand geographically,
Blend, which has never been profitable, raised $360 million
in its IPO, selling 18 million shares at $18 each. The price was
at the upper end of the $16 to $18 range announced earlier. The
stock opened at $20 per share.
It had filed confidentially for its listing in April.
The San Francisco-based company had 291 customers, including
Wells Fargo & Co and Lennar Mortgage, as of last year.
Goldman Sachs & Co, Allen & Company and Wells Fargo
Securities were the lead underwriters for the offering.
(Reporting by Niket Nishant in Bengaluru; Editing by Shinjini
Ganguli and Amy Caren Daniel)