IPO Preview: dLocal, Online Payment Company In Emerging Markets, Leads Short Holiday Week

The IPO calendar has only one scheduled offering for the shortened holiday week of May 31. Here is a look at what investors should know about dLocal Limited DLO.

The Offering: dLocal Limited plans to offer 29.4 million shares at a price point of $16 to $18. The company will be listed on the Nasdaq with the ticker "DLO."

About dLocal: Covering 29 countries, dLocal is seeking to redefine the online payments experience for emerging markets. The company covers markets in Latin America, Asia, Africa and the Middle East.

The company has a customer base of more than 330 merchants covering over 2 billion combined internet users. dLocal offers over 600 local payment methods.

dLocal offers its partners one direct API, one technology platform and one contract under its one dLocal model. The company enables global merchants to get paid and make payments online using a proprietary, fully cloud-based platform.

Merchants that use dLocal services include DiDi, Wix.com WIX, Amazon.com AMZN, Spotify Technology SPOT, Microsoft Corporation MSFT and MailChimp.

Key verticals served by dLocal include retail, streaming, ride-hailing, financial services, advertising, SaaS, travel, e-learning and gaming.

Related Link: IPO Preview: ZipRecrutier, Fintech Companies Paymentus, Flywire Lead Week Of Offerings

Growth Projections For dLocal: Of the 29 countries in which dLocal operates, seven countries hav yet to process any volume.

The average customer used the dLocal platform for five countries and 35 payment methods in 2019. Those figures grew to six countries and 44 payment methods on average for 2020 as dLocal becomes more of a trusted partner for its merchant customers.

The company highlights the growth of middle class and smartphone penetration in emerging markets as keys to its growth. The growth of cross border payments is also highlighted as a key for growth ahead.

dLocal Financials: dLocal posted revenue of $104 million in fiscal 2020, up 129% year-over-year. The company reported revenue of $40.3 million in the most recent quarter, up 124% year-over-year.

The company had total payment volume of $2.1 billion in 2020 and saw total payment volume grow at a compounded annual growth rate of 97% from 2016 to 2020.