The newly public Rocket Companies Inc. should absolutely be valued as a financial technology company, rather than a consumer finance organization, the two top executives said Thursday.
The Detroit-based parent organization of Quicken Loans Inc. pushed forward Wednesday night with a downsized IPO that valued the company at $1.8 billion, down from the $3.3 billion the company had initially planned. Rocket began trading as RKT on the New York Stock Exchange on Thursday morning.
During an interview on CNBC ahead of the market open, Rocket Companies co-founder and Chairman Dan Gilbert stressed that the company is very much a technology-driven organization, despite investors viewing the business as more of a consumer finance company, which contributed to the lower valuation, according to Bloomberg.
"Yeah, that's sort of one of the big points of contention," Gilbert said, noting that Rocket employs 2,500 technologists. "We think we're a technology company that happens to do home loans. We said that forever."
The CNBC appearance was Gilbert's first TV interview since suffering a stroke more than a year ago that caused temporary paralysis of his left arm and leg.
Gilbert told the CNBC hosts he's feeling well.
"I'm doing a lot better," he said. "The people around me helped me every day, so it's been quite an experience, and quite a challenge."
As Rocket begins its journey as a public company, executives there have lofty goals of growing within the mortgage industry. Currently the company enjoys about 9 percent market share, CEO Jay Farner said during the CNBC interview. In the coming years, he hopes to grow that to 25 percent, he said, which would mean about $500 billion in mortgages.
"(That's) where we've got our sights set, and I know our 20,000 team members are ready to make that happen," Farner said.
Each employee will get stock options in the company as part of going public.
Farner pushed back on the notion that the company got a cooler-than-anticipated reception from investors, leading to the downsized offering. Rather, the company is focused on longevity, he said.
"We've got 35 years in the business so we're more focused on the next five to10 years than any given moment in time," Farner said. "And so the investor base for our opening was probably the most important thing, and so we focused on that versus selling as many shares as we possibly could. So I think we're in great shape and more excited than ever about the future."
The Detroit-based company which, during non-pandemic times, has about 18,000 people working in the city's central business district, has built its corporate culture around "isms," or 19 sayings that define its philosophy.
Gilbert said he hopes to keep that corporate culture fully intact, despite now being susceptible to headwinds like quarterly earnings.
"We're doing everything we can to prevent it from changing, and we're hoping that putting stock in every single person's hands who works at the business puts everybody on the same side of the table," Gilbert said. "And then there's even more cohesion and an increased focus on culture."
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August 06, 2020 at 08:57PM
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Gilbert, Farner stress Rocket Companies' standing as technology company amid cooler IPO - Crain's Detroit Business
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