Funding Circle’s IPO was priced at 440p when it floated on Friday. The share price has fallen to 380p as of today.
Eight-year-old, Funding Circle are one of the UK’s largest peer-to-peer lenders. They match small firms with investors, to date having served over 50,000 businesses – a jetpack business and giant teddy company included. Despite never having made a profit, they have global presence from operating in the US, Germany and the Netherlands.
They said they would offer shares to city institutions as well as ordinary investors, with a price range from 420p to 530p, hence the high value float. Ordinary savers are able to take part in the float, so long that they buy at least £1,000 worth of stock each. Founders would be on track to realise multi-million-pound fortunes.
Samir Deasai, the co-founder and chief executive would get the top end of the price range, with a 7.7% stake. His stake would be worth £130 million – a remarkable return for him. Co-founders, James Meekings and Andrew Mullinger would have stakes worth between £78m and £89m. Anders Povlsen, the billionaire tycoon behind clothing retailer Asos, agreed to buy a 10% stake when the firm floats.
The listing is seen as a test for the investor interest in financial technology, particularly the online lending space whereby many start-ups have been created in the hope to challenge traditional banks.
Listing on the London Stock Exchange intends to raise £300 million for Funding Circle.