Revolut’s announcement of a major secondary share sale reinforces its $45billion valuation and enables employees to share in the company’s rapid rise.
This development highlights Revolut’s financial success and strategic achievements, while also suggesting that the company is reaching a pivotal stage where its next steps – such as a potential IPO – are becoming increasingly important.
Revolut’s secondary share sale, backed by investors such as Coatue, D1 Capital Partners and Tiger Global, provides a significant liquidity opportunity for its employees. This sale enables many to benefit from their role in the company’s rapid expansion.
With revenues increasing by 95 per cent to $2.2billion in 2023 and a record profit before tax of $545million, the resulting $45billion valuation reflects the scale of Revolut’s recent financial performance.
Nik Storonsky, CEO of Revolut, commented on the milestone: “We’re delighted to provide the opportunity to our employees to realise the benefits of the company’s collective success. It’s their hard work, innovation, and dedication that has driven us to become the most valuable private technology company in Europe. We’re also excited to partner with several new investors who share our vision as we continue our journey to redefine the banking landscape as we’ve known it.”
What lies ahead
While this move underscores Revolut’s strength and maturity, it also raises considerations about the company’s future trajectory. The impressive $45billion valuation comes at a time when Revolut is navigating complex regulatory environments across multiple markets and contemplating where to list its shares for a potential IPO. The scale of the secondary share sale, coupled with the involvement of major investors, hints at the company’s readiness for even larger moves, such as a public listing.
The UK government, eager to retain Revolut’s public listing in London, is reportedly preparing discussions to persuade the fintech giant to stay, even as speculation grows that Revolut might lean towards the US for its high-profile debut.
Revolut’s recent progress on the regulatory front further adds to the conversation. The company secured a UK banking licence with restrictions last month, entering the ‘mobilisation’ phase. This step allows Revolut to build out its UK banking operations before fully launching in the market. While this development marks progress, it also highlights the challenges Revolut faces in meeting regulatory requirements while continuing its aggressive global expansion.
Broader trends
Matt Cooper, co-CEO of equity crowdfunding platform Crowdcube, described Revolut’s secondary sale as an “unprecedented event.” Reflecting on Revolut’s journey, he stated, “Europe has never witnessed a secondary share sale on such a scale. We are incredibly proud that seven years ago we provided retail investors the opportunity to invest in what has now become Europe’s most valuable company.”
Cooper’s comments also shed light on the broader trends within the financial markets, noting that the success of private markets in the UK and EU contrasts sharply with the decline of the AIM market. “It also shows how large the private markets are becoming in the UK and EU at a time when the AIM market is in steep decline,” he added.
Highlighting the impact of early investments, Cooper mentioned, “We raised £1million from 433 investors -an investment now valued at more than $400million. A 40,000 per cent increase in the value of that investment shows just how much wealth can be created for everyday investors by providing unrivalled access to the best private companies.”
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