Fintech helps London enjoy a bumper year for IPOs

Fintech helped London enjoy a bonanza 2021 for IPOs.

Figures show that 108 companies have come to market in London in 2021, a marked uplift on 2020 (38) and 2019 (50) and the most since 2017.

The City of London has also retained its mantle as the IPO capital of Europe, with around £13.9bn raised through floats in the Square Mile over the last year.

This was ahead of its closest European rivals Stockholm and Amsterdam, which raised £9.4bn and £7.2bn.

Fintech listings in London this year include Wise,PensionBee and LendInvest, with more expected next year.

In April, pensions provider PensionBee arrived on the London Stock Exchange with its shares priced at 165p, the mid-point of the 155-175p range that the fintech was aiming for.

That gave PensionBee a valuation of £365m.

In July, international payments firm Wise made its stock market debut with a valuation of £8.75bn, making it the largest-ever listing of a UK tech company.

Formerly known as TransferWise,Wise went public via a direct listing, which is where a company starts trading publicly but does not issue new equity.

Also in July, after aborting its earlier listing plans in 2019, property finance platform LendInvest went public on the junior AIM market.

The listing, valuing the company at £255.6m, saw LendInvest raise £40m from its new share offering.

Meanwhile, the CEO of Zopa Jaidev Janardana told AltFi he plans to take Zopa public as early as the last quarter of 2022 while money transfer startup WorldRemit is thought to be teeing up a  potential initial public offering (IPO).

Checkout.com could also come to market next year. Its founder and CEO Guillaume Pousaz has said that “I do think that eventually, a listing will be the right path for Checkout.com”.

The report by KPMG found that 53 companies have been listed on London’s main London Stock Exchange (LSE), with the remainder joining AIM.

It attributed the drive up in listings to “pent-up investor demand” which has built up over the Covid period, as “well as generally strong equity market conditions”.

Financial services was a key sector, accounting for 35 per cent of funds raised from listings during the year, ahead of the technology, media, and telecoms sector, which accounted for 32 per cent of new funding.

Linda Main, head of KPMG’s UK Capital Markets Advisory Group, said: “As the UK, once again, enters increased Covid-19 related restrictions, the course of the pandemic continues to cause uncertainty for all."

"However, 2021 proved that investor demand for new equity issues remains incredibly resilient despite these unknowns, and the IPO pipeline suggests this trend will carry forward into 2022.”

Svetlana Marriott, partner in KPMG’s UK Capital Markets Advisory Group, said: “It’s fantastic to see London keeping its status as the leading European market as we continue to grapple with the knock-on effects of the pandemic."

"Next year, updates to UK listing rules will be in effect, designed to make London even more competitive. This should help the capital retain its leading position, but IPO candidates will need to assess any impact of these changes on their listing plans.”