Blockchain-powered mortgage lender and cryptocurrency exchange operator Figure Technology Solutions is targeting a fall initial public offering (IPO), aiming to raise between $500 million and $1 billion, according to its co-founder Mike Cagney. The move positions Figure among a wave of crypto firms capitalizing on a more favorable regulatory climate under the Biden administration and surging investor appetite for the sector.

Cagney, the former SoFi CEO who founded Figure in 2018, revealed the plans during a recent interview at the company's San Francisco headquarters. He indicated the IPO push follows the successful debut of stablecoin issuer Circle, whose shares have surged eightfold since its June listing. "We want to raise a billion dollars," Cagney stated, adding, "One thing that's really apparent to us is there's a lot of capital out there."

Sources familiar with the matter disclosed that Figure has initiated exploratory talks with potential investors, including financial giants BlackRock, SoftBank, and Tiger Global Management. This marks a renewed effort for Figure, which previously abandoned an IPO attempt during the Biden administration due to regulatory objections over wording in its filings.

Figure's financials, presented to investors, showcase robust growth: first-quarter annualized revenue reached $355 million, representing approximately 35% year-over-year growth. The company also reported $121 million in EBITDA (Earnings Before Interest, Taxes, Depreciation, Amortization, and stock-based compensation). Its primary revenue driver is originating home equity lines of credit (HELOCs), a segment experiencing steady expansion. Rising home values have increased homeowner equity, while many homeowners, locked into low mortgage rates, are opting to tap this equity via HELOCs rather than refinancing at higher rates.

Cagney highlighted Figure's proprietary blockchain technology as a key differentiator, enabling the company and its lending partners to slash costs. The technology consolidates loan records in a single database, streamlining processes and reducing auditing and operational expenses. Currently, the majority of Figure's loan volume is facilitated through partnerships with platforms like Credit Karma and Guaranteed Rate. This strategy fueled a 50% increase in loan volume last year, reaching $5.1 billion. Figure also generates income by securitizing loans and selling them to investors for a fee, noting in investor materials that its loan portfolios have consistently maintained credit loss rates at or below 1%.

Beyond mortgages, Figure is pursuing expansion into prime brokerage services. This business line would cater to large institutional investors, offering securities lending and other sophisticated financial services. The company also aims to allow users to lend cryptocurrencies and stocks, including Figure's own stock, via its blockchain. Additionally, Figure has begun originating cryptocurrency-collateralized loans for sale to private credit firms.