Revolut is a UK-based fintech company that has recently achieved an impressive $45 billion in valuation. This is bucking the trend for falling valuations within the fintech industry.
Revolut is now Europe’s top-valued start-up, and the move highlights its resilience to market pressures.
Investors Coatue and D1 Capital Partners were key participants in the transaction. Employees sold a part of their fully vested stock options.
Revolut’s valuation for 2021 is higher than expected by a large margin
Revolut’s 2021 funding led by SoftBank, Tiger Global and Tiger Global raised $33 billion. The valuation of $45 billion is significantly higher.
Revolut is now the UK’s second-most valuable bank, behind only HSBC, surpassing other traditional banks such as Barclays and Lloyds Banking Group.
Revolut is now a leader among European start-up tech companies, and its latest valuation confirms that. It places it far ahead of other competitors, such as Checkout.com, which has seen its valuation plummet in the wake of a general tech downturn.
Klarna’s valuation dropped from $46 Billion to $7 Billion during the 2022 funding round. Checkout.com, on the other hand, reduced its internal value to $11 Billion in that same year from its previous high of 40 billion.
Still behind US counterparts?
Revolut, despite its impressive valuation, still lags behind US counterparts Stripe and Nubank. These companies have valuations between $65 billion and $66,6 billion.
The significant increase in valuation is likely to boost interest for Revolut’s anticipated Initial Public Offering (IPO), as global stock exchanges are eager to lure the fintech titan.
Revolut will be in discussions with the UK Treasury in the fall, in an attempt to convince the company to go public in London instead of New York.
Insiders say that Revolut is still leaning towards an IPO on Nasdaq. Nikolay Storonsky, and Vlad Yatsenko, co-founders, have expressed a preference to a New York IPO due to London Stock Exchange’s lack of liquidity.
Top Revolut executives increase their net worth
Revolut’s executives have seen their fortunes significantly boosted by the share sale. According to a Financial Times review of August public documents, Storonsky’s stake is worth nearly $8 billion.
Martin Gilbert, the chairperson of Revolut, has a stake that could amount to more than $850,000. Revolut declined to make any comment about these figures.
The UK Banking Licence was awarded to Revolut last month after a three-year long process.
This license is likely to allow Revolut’s domestic operations to grow, thereby enhancing the company’s competitiveness.
Revolut, despite the delays in getting the UK license, has already built a large customer base. The company boasts more than 45 millions customers worldwide, with approximately 9 million of them in the UK where it was founded in 2015.
Fintech also has a European Banking Licence from Lithuanian authorities and a recent banking license in Mexico.
Revolut could benefit from the UK license by gaining similar approvals on other important markets including in the United States.
Revolut’s Growth Strategy
Revolut’s aggressive expansion abroad has marked its growth strategy. Its customer base is now larger than those of UK competitors Monzo or Starling.
The company announced a profit before tax of PS438 for 2023 last month. This is a huge turnaround from the loss of PS25 that it had the year prior.
Revolut also reported a nearly two-fold increase in revenues, with its revenue reaching PS1.8 billion. This shows the rapid growth of Revolut.
Revolut employees who have been working for the company at least one year, and are not on gardening leaves were eligible to take part in this share sale. The employees could sell up to 20% of the vested options they had at $865.42 each share.
This round was different from previous rounds in that former employees weren’t eligible.
The post Revolut Secures $45 Billion Valuation in Employee Share Sale amid Fintech Downturn may be updated as new developments unfold.
This site is for entertainment only. Click here to read more
