Funding Circle To IPO, Raise $387.4M

Funding Circle, U.K.-based peer-to-peer lender, announced Monday (Sept. 3) that it is aiming to raise $387.4 million via the issuance of new shares.

According to a report by CNBC, the listing would happen on the London Stock Exchange. What’s more, Reuters reported Heartland A/S, the private holding company for Danish billionaire Anders Holch Povlsen, is buying 10 percent of the issued shares. “At Funding Circle, our mission is to build a better financial world. Today’s announcement is the start of the next stage in our exciting and transformational journey. Over the last eight years, we have worked hard to build a platform that is number one in every market we operate in,” Samir Desai, CEO of Funding Circle, said. Bank of America Merrill Lynch, Goldman Sachs, Morgan Stanley and Numis Securities have been signed up to act as bookrunners, reported CNBC.

CNBC reported that, in the six months ending June 30, the peer-to-peer lending startup had revenue of £63 million, which is up from £40.9 million in the same period last year. Losses were £27 million in the six-month period, higher than £19.2 million in the first half of 2017. CNBC noted that Funding Circle has facilitated £5 billion of loans, all going to small and medium-sized businesses since its launch eight years ago. “It is a prime example of a new breed of financial services companies, who by making their products more transparent and more convenient, have democratized access to valuable services and increased economic activity,” Neil Rimer, partner at Funding Circle’s largest shareholder, Index Ventures, said.

The listing comes as the Funding Circle Income Fund (FCIF), the investment vehicle operated by Funding Circle, is reducing its footprint in the U.S. The fund is reportedly turning away from U.S. exposure and doubling down on local investment through new plans with the British Business Bank (BBB), P2P Finance News reported in July. The FCIF is set to receive additional funding from the BBB in a more formal partnership between the two entities.