American digital financial platform MoneyLion announced a merger with the blank check acquisition company Fusion Acquisition Corp FUSE on Friday.
The SPAC Deal: MoneyLion is valued at $2.4 billion in the merger, which will give the company $500 million in gross proceeds.
Fusion Acquisition is led by Jim Ross who worked at State Street Corporation STT for over 20 years. Ross is considered an ETF pioneer, bringing to market two of the most popular ETFs: the SPDR S&P 500 ETF SPY and SPDR Gold Trust GLD.
Current Fusion Acquisition shareholders will own 12% of MoneyLion after the merger.
About MoneyLion: MoneyLion caters to middle-class Americans with products covering mobile banking (RoarMoney), investing, instacash salary advances and a credit builder platform. Credit Builder Plus boosts users credit by more than 60 points in 60 days in 50% of cases, the company said.
The company has over 1.4 million customers.
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Growth Ahead: MoneyLion is set to launch several new products in 2021 that could help its growth plans.
A secured credit card offering with limits of $250 to $10,000 will launch for MoneyLion customers in 2021.
The company says it will launch a crypto platform this year. The platform would allow customers to trade and earn rewards in digital assets, and use a crypto wallet for person-to-person payments.
Launching more products could be a major catalyst as the company gets higher average revenue per user for each additional product used. The company has an average revenue per user of $148. That figure rises to $200 and $248, respectively, for customers who use two or more and three or more products.
Financials: Adjusted revenue was $76 million for MoneyLion in fiscal 2020. Fiscal 2021 revenue is estimated at $144 million, up 88% year-over-year.
Revenue growth was +113% year-over-year, +59% year-over-year, +56% year-over-year and +60% year-over-year in the four respective quarters of fiscal 2020.
The SPAC merger values MoneyLion at 16.5x estimated 2021 revenue and 9x estimated 2022 revenue.
Price Action: Shares of Fusion Acquisition Corp were down 5% to $11.59 on Friday.
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