Banking app Dave has agreed to merge with VPC Impact Acquisition Holdings III, a special purpose acquisition company (SPAC) backed by Victory Park Capital (VPC) to become a publicly traded company.
Upon closing of the transaction, Dave is expected to have a fully-diluted equity value of nearly $4bn, on a pro forma basis, assuming no redemptions.
Formed in 2017 as an app to help customers save overdraft fees charged by traditional banks, Dave has become a financial platform with 10 million customers.
In December last year, the company has rolled out Dave Banking, a spending account and debit card with no monthly fees, which is being used by more than 1.3 million members.
Dave CEO Jason Wilk said: “At Dave, we’re committed to improving the financial health of our members. We believe the legacy financial system has failed to deliver and today, more than 150 million people need our help to build financial stability.
“Dave is upending the banking industry with our suite of breakthrough financial products and making a meaningful impact on our customers’ lives.
“This transaction and continued support from our longstanding investors signify confidence in our strategy, vision and the significant growth opportunities ahead.”
VPC is a Chicago-based investment firm focused on executing debt and equity financing transactions with fintech companies.
It has been a long-term investor in Dave and recently offered a $100m credit facility to the company in January 2021.
The proposed merger is expected to close later in this year, subject to regulatory approvals and other customary closing conditions including VPCC stockholders’ approval.
Centerview Partners served as exclusive financial advisor and Orrick, Herrington & Sutcliffe as legal advisor to Dave on the transaction.
Citigroup and Jefferies served as capital markets advisors and co-placement agents on the PIPE, and White & Case as legal advisor to VPCC.
VPC senior partner and co-founder Brendan Carroll said: “Dave’s growth and expansion over the last few years have been significant and we believe that the company has only scratched the surface of what it can achieve.
“With its strong management team, differentiated product suite and immense brand affinity, we believe Dave is well-positioned to achieve future growth and continue to disrupt the legacy financial system.”
