Affirm Delays Its IPO

The move comes just a day after The Wall Street Journal reported that videogame company Roblox Corp., which was on a similar IPO timetable, put its listing on pause until early next year.

Roblox decided to wait because of challenges arising from the first-day jumps, according to people familiar with the offering. When shares jump like Airbnb’s and DoorDash’s did, the companies miss out on billions of dollars they might have raised and instead hand it to select investors lucky enough to get IPO allocations.

Roblox’s board met Friday and determined that, given those considerations, the company and its underwriters should rethink how to price the offering, one of the people said.

“Based on everything we have learned to date, we feel there is an opportunity to improve our specific process for employees, shareholders and future investors both big and small,” Roblox Chief Executive David Baszucki said in a memo to employees that was viewed by the Journal.

Both Roblox and Affirm will consider selling a larger portion of their shares and changing the mix of stock to be sold by the company, its employees and shareholders as they seek to mitigate any initial pop, some of the people said.

This year has been the busiest ever for IPOs as measured by dollars raised in the U.S., a frenzy that has been fed by a wave of traditional listings as well as deals by shell companies known as special purpose acquisition companies. Affirm and Roblox were set to join an unusual year-end rush of companies seeking to go public after the coronavirus pandemic upended the traditional new-issue calendar. Both companies were expected to draw strong investor demand.

Affirm, which offers online shoppers the ability to pay for goods in installments through short-term loans, was expected to fetch a valuation of as much as $10 billion.

Write to Maureen Farrell at [email protected] and Cara Lombardo at [email protected]