Alkami Technology has chosen Goldman Sachs Group Inc. to lead its initial public offering of its U.S. banking software provider later this year, which may be valued at $3 billion according to a report in Reuters.
Backed by investors including General Atlantic, D1 Capital Partners and Fidelity Management and Research Company, the Texas-based firm supplies cloud-based platforms that banks and credit unions can use to set up digital offerings for their retail and business customers.
The COVID-19 pandemic highlighted how financial services companies need secure and effective digital platforms. Smaller banks which may not have resources to invest in developing cloud-based platforms internally, can turn to third-party providers such as Alkami.
Alkami last raised capital from private investors in September, taking $140 million at an undisclosed valuation. The company said at the time it had $130 million of annual recurring revenue.
Investor interest in software companies and the buoyant market for IPOs in general, is likely to be beneficial for Alkami.
Approximately 160 financial institutions are using Alkami’s services.