Fintech Revolut Lines up US$500m Share Sale

Revolut, the UK’s leading neobank, is reportedly drawing up plans to enable its employees to cash in their share of the bank, with plans in place for Revolut to sell US$500m worth of stock. 

It is expected that Morgan Stanley will be approached to coordinate the proposed stock offering – which looks set to take place later in 2024. Revolut is not planning to raise new capital as part of this transaction and aims to restrict the share sale to employees only.

CEO Nik Storonsky is supposedly determined to see Revolut’s valuation match the US$33bn it was valued in its 2021 primary funding round. 

With Revolut's FY2023 revenue expected to double to £1.7bn (US$2.15bn) when official figures are released later in the year, the fintech is confident it can see its valuation unmoved. 

This hope is furthered by Revolut’s growing customer count, which now stands at over 40 million. Indeed, Schroder, a prominent Revolut investor, believes the neobank’s value has climbed 45% since last year. 

Revolut: Can it hit 2021 valuation?

Hitting its US$33bn 2021 valuation would represent a significant feat for Revolut. 

The immediate post-COVID-19 investment landscape saw valuations soar to unprecedented levels as VC activity boomed following prolonged periods of lockdown and the release of stored capital reserves onto the market. 

Many fintechs saw valuations rise significantly during this time, before they fell to more stable levels in the following two years as markets stabilised.

By aiming to match its 2021 valuation, Revolut is confident that its growth rate has been substantial enough to warrant an equally high valuation.

Its confidence in doing so is not unreasonable either. The fintech has, since its 2015 founding, risen to become the UK’s leading neobank, outstripping the likes of Monzo and Starling Bank in year-on-year revenues. 

With its market-leading digital-first offerings, Revolut has made its intentions to create a mobile ‘super app’ clear in recent times, with plans in place to roll out mobile data offerings after launching its eSIM in early 2024. 

The release of eSIM meant Revolut became the first UK financial institution to offer data plans – part of its bid to grow the Revolut brand beyond financial services alone. 

What’s more, Revolut's latest stock sale comes as it awaits its full UK banking licence, a process that has so far stretched for over three years.

As the neobank continues to push for approval, it has launched of series of new solutions to enhance the experience for its customers, including its advanced AI feature to protect against card scams. 

Speaking on the launch of the product, Head of Fraud at Revolut, David Eborne, said: “We’ve invested heavily in the product to ensure that customers can continue to spend and send their money safely. For example, a growing number of banks are increasingly restricting or heavily limiting the ability to make card payments to crypto and investment websites."

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