Peer-to-peer lender Funding Circle makes debut on London exchange

PEER-TO-PEER lender Funding Circle has debuted on the London Stock Exchange with a valuation of £1.5bn, cementing its status as one of the UK’S top technology unicorns.

The shares were priced at 440p each, at the bottom of the 440p to 460p range it had set, lowered earlier in the week from the original price range of 420p to 530p.

Funding Circle, which had hoped for a valuation of £1.8bn, offers investors an online platform on which they can lend money to small and medium-sized companies in the UK, the US, Germany and the Netherlands.

The financial technology company, founded in London in 2010, is the first big IPO in the capital since the summer. Experts say it shows the sector “has now come of age”. The business, backed by Danish billionaire Anders Holch Povlsen, is the first of a new wave of fintech companies that emerged in the aftermath of the global financial crisis of 2008.

It was set up by former Oxford University students Samir Desai, James Meekings and Andrew Mullinger.

‘The whole Funding Circle team have built a world-class fintech company’

Mr Desai previously told The Daily Telegraph that the company faced an uphill battle from the beginning as the lending industry was dominated by banks, making it difficult for the start-up to gain attention or trust.

In the first half of 2018, Funding Circle posted a loss of £16.3m on revenues of £63m. Revenue for the same period a year earlier had come in at £13.2m.

Neil Rimer, a partner who led Funding Circle’s investment and board member of the company, said the IPO showed that after a “decade of rapid experimentation and growth”, the European fintech sector had now “come of age”.

It follows the successful listing of Amsterdam-based Adyen and Paypal’s purchase of Stockholm’s izettle.

Mr Rimer added: “We see these transactions as some of the first major-market validations of a new breed of businesses that sprang up in the wake of the financial crisis.”

Harry Nelis, partner at Accel, who led the company’s first investment in Funding Circle in 2013, said: “The founders and the whole Funding Circle team have built a world-class fintech company.”