Revolut boss says London IPO is ‘not rational’

Revolut’s chief executive Nik Storonsky has said it is “not rational” for Europe’s most valuable fintech start-up to publicly list in London, dealing a blow the new government’s plans to boost the stock market.

Storonsky said the London-based banking company would consider a public debut “sooner or later” to raise cash and return money to shareholders in what could be a blockbuster IPO.

However, he argued the UK market “can’t compete” with the liquidity offered by the US, given the stamp duty charged on buying shares.

Revolut and other fintech ‘unicorns’ publicly called for the tax to be scrapped earlier this year, while new Lord Mayor of London Alastair King said on Monday that the government should “look again” at the duty.

“If you look at trading in the UK, you always pay a stamp duty tax which is 0.5 per cent. I just don’t understand how the product which is being provided by the UK can compete with the product provided by the US,” Storonsky told the 20VC podcast.

“If I get a better product from the UK, I’ll list in the UK, but so far if you just compare these products, one is far ahead than the other.”

Storonsky added that if he were to start Revolut today, he would do so in the US. He named Brazilian neobank Nubank and Wall Street titan JP Morgan as Revolut’s biggest competitors.

The comments signal Revolut is leaning towards going public in New York, rather than London, and could follow in the footsteps of other British tech stars, like chipmaker Arm, which have been attracted to deeper pools of capital across the pond.

City AM understands new City minister Tulip Siddiq has recently met officials from Revolut, including its UK chief executive Francesca Carlesi, to emphasise London’s appeal.

The London Stock Exchange has seen just 14 new listings this year, while UK equity funds continue to suffer heavy outflows as the government and regulators scramble to implement sweeping capital markets reforms.

Storonsky, who co-founded Revolut in 2015, argued last year that he did not “see the point” of listing in London due to the UK’s regulatory environment.

However, chair Martin Gilbert said in July that the firm would “keep an open mind” on a potential listing venue and praised recent changes to make it easier for companies to float in London.

After securing a $45bn valuation an August employee share sale, Revolut has become one of the UK’s most valuable banks and is worth more than Lloyds, Natwest and Barclays.

The fintech is preparing to launch as a fully-fledged lender in its home market, where it has more than 10m users, after receiving a provisional banking licence in July. It is also expected to help Revolut’s chances of securing a licence in the US.