On Thursday, one of the year’s most highly anticipated initial public offerings (IPOs) unfolded as neobank Chime successfully raised an impressive $864 million. The company priced its shares at $27, exceeding its initially projected range of $24 to $26 per share. This pricing led to a robust starting market capitalization of approximately $9.8 billion, making a significant mark in the fintech industry.

Though this valuation is notably lower than Chime’s last private valuation of $25 billion, as estimated by PitchBook, the enthusiasm from retail investors was palpable. When trading commenced, shares opened at $42, which led to a midday trading price around $14.5, according to Yahoo Finance. The enthusiastic reception from retail investors can largely be attributed to Chime's impressive financial performance in recent years.

In its most recent financial disclosures, Chime reported a revenue of $1.3 billion for the year 2023, with projections estimating an increase to $1.7 billion in 2024. Furthermore, the company's losses significantly decreased from $203 million in 2023 to just $25 million in 2024. Chime has made strides towards profitability, achieving a net income of $13 million on $519 million in revenue in its first quarter of 2025. However, the company has cautioned that it may not maintain this financial fortitude as it continues to invest heavily in growth initiatives.

The journey to this remarkable IPO was hardly without its challenges. Like many startups, Chime faced numerous obstacles, including layoffs in 2022 and a significant regulatory battle in 2021 when it was prohibited from branding itself as a “bank.” Yet, perhaps the most daunting moment in the company’s history came in the early days, when it nearly collapsed before securing crucial funding.

Co-founder Ryan King, who also served as the company’s original Chief Technology Officer, candidly recounted the struggles of the early years. Founded in 2012, Chime encountered immense difficulty in convincing investors of the viability of its concept. King remarked, “The first five or six years were very difficult in terms of convincing investors to invest in the idea and the business. It was just way, way harder than I expected.” In early 2016, as the company sought to extend its Series A funding, they faced a daunting reality: they pitched to over 100 investors and received a resounding 100 rejections.

During this challenging period, Chime was nearing a financial crisis. Despite the bleak outlook, both King and co-founder Chris Britt remained resolute in their mission to offer an accessible online banking experience tailored for the working class. Chime operates on a model that does not charge users overdraft fees and provides tools for building credit, including cash-secured credit cards.

However, the investment landscape was not favorable, with many venture capitalists hesitating to support a startup in such a heavily regulated industry, especially one with limited growth at that time. King recalls feeling a mix of disbelief and determination as he read stories of other startup founders, noting, “I get 50 no’s in a week,” referencing Robinhood’s struggles to secure funding.

The pivotal moment for Chime arrived with a single seed investor, Lauren Kolodny, who was then a partner at Aspect Ventures and is now a co-founder of Acrew Capital. She took a substantial risk by leading a crucial $9 million extension round for Chime, believing wholeheartedly in the vision presented by Britt and King. Kolodny’s timely investment not only saved Chime but also led to her being invited to ring the opening bell at Nasdaq, a testament to her support. At the time, Kolodny bought in at only 26 cents per share, leading to significant returns on her investment as Chime’s valuation soared.

Fast forward to the recent IPO, a notable highlight for King occurred during the company's road show as it pitched to institutional investors. A moment of serendipity unfolded when a security guard at the venue recognized Britt’s Chime card. The guard’s enthusiastic response, “Checking and savings, baby!” accompanied by a high five, symbolized the strong community and customer loyalty Chime has cultivated over the years.