Questions over Lanistar’s £150m valuation

By Aisling Finn on Friday 27 November 2020

Digital Banking

Lanistar’s £15m July fundraise was reportedly a loan, throwing its £150m valuation into doubt

Questions over Lanistar’s £150m valuation
Image source: Gurhan Kizlioz/Lanistar

 

Lanistar appears to have plucked its £150m valuation out of thin air after an investigation by The Times showed there had been no external valuation of the business in its fundraising efforts.

A spokesperson for the fintech confirmed to The Times that, rather than being an actual equity investment, the £15m Lanistar raised was actually a “director’s loan,” further undermining the earlier £150m valuation the fintech said Milaya Capital had assigned to it.

As a reminder, the £15m originally coming from Milaya Capital in July was withdrawn in October, after founder and CEO Gurhan Kizlioz said his family would step in after Milaya withdrew from the round.

Lanistar maintained that its £150m valuation still applied under the new funding arrangement, although it now appears this is not the case.

Since it first burst onto the fintech scene back in March, Lanistar has struggled to stay out of the headlines. 

CEO and founder Gurhan Kizlioz ruffled a few feathers when he confidently declared that Lanistar he “fully expected to become the next £1bn fintech company”, although it now appears this figure has increased to £10bn, which would make it twice the valuation of Europe’s largest digital banking service Revolut.

Lanistar’s most recent round of media attention comes after the fintech launched a social media campaign, which saw footballers, celebrities, Love Island contestants and other social media influencers post about the yet-to-be-launched company. 

In the fintech’s new app, it was also revealed that Lanistar appeared to have paid these influencers in equity, stating that it was “part-owned by 3,000 of the world’s most influential people.”

As a result of the social media frenzy, the fledgeling fintech has now found itself in hot water with the Advertising Standards Agency (ASA), less than two weeks after it was in a similar situation with the FCA.

Currently, the ASA is looking into allegations made against the fintech. Some reports suggest that many of the celebrities paid to promote Lanistar failed to tag their sponsored posts as ads.

Lanistar found itself on thin ice with the FCA after it falsely claimed to have been authorised by the regulator and any money held in a Lanistar account would be protected up to €100,000.

The FCA flagged Lanistar as operating in a potentially fraudulent manner but removed the notice just two days later after the fintech agreed to make changes to its messaging.

AltFi has reached out to Lanistar for comment and is awaiting a response.

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