NerdWallet Comments on Fundera’s Contribution to Its Business

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nerdwalletWhen NerdWallet acquired Fundera two years ago, few people were shocked. That’s because the nation was months into the covid crisis and M&A was happening at a furious pace. The $29.2M paid at closing with a potential earn-out of up to $66M, however, suggested Fundera stood to play a significant role with the company, especially given that NerdWallet generated only $379.6M in revenue in 2021.

More recently in Q2 2022, the SMB side of NerdWallet’s business has been doing well. NerdWallet CEO Tim Chen said, “This past quarter, our SMB business continued its momentum with triple-digit year-over-year revenue growth.”

While Fundera’s SMB loan generating business contributed to that, Chen said that NerdWallet had been successful in “landing and expanding within new SMB areas such as payments, insurance and accounting services.”

“The progress we’ve made since the Fundera acquisition is not only great news for SMB, we also think it underscores opportunities enabled by vertical integration more broadly,” Chen said. “Given this success, we furthered our vertical integration efforts through our acquisition of On the Barrelhead, a loan matching platform that connects consumers and SMBs with products from its lending partners.”

“…We are increasingly encouraged by the success we’ve seen in SMB,” said NerdWallet CFO Lauren StClair Waugh, “and we have shown our ability to run our integration playbook and direct our strong organic traffic through Fundera’s efficient and reoccurring funnel.”

NerdWallet has been pleased with its acquisitions.

“We’re going to be very prudent about our M&A strategy, and price will remain an important consideration for us in evaluating all opportunities,” Chen stated. “At times, macroeconomic volatility will present opportunities to buy great businesses at reasonable prices. This was the case with both Fundera and On the Barrelhead. We will continue to take an opportunistic approach to M&A in the future to further accelerate and enhance our capabilities.”

NerdWallet generated $125.2M of revenue for the quarter and a net loss of $9.3M.

Last modified: August 30, 2022

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