(Bloomberg) -- Revolut Ltd.’s talks with Tiger Global Management to have the venture capital giant lead an upcoming share sale is the latest sign that investors are once again warming to fintechs, according to the startup’s UK chief Francesca Carlesi.
Tiger is in talks to lead the share sale, which will be a secondary offering, meaning it won’t entail the issuance of new stock, but rather involve employees selling existing shares. Revolut has hired Morgan Stanley to help it with the sale, which may value Revolut at more than $40 billion.
“This is a vote of confidence, every time a new investor comes on board it’s a big sign,” Carlesi said in a Bloomberg Television interview, declining to comment on the specific timeline of the sale. “This is a good measure, a moment of truth for all of us.”
The new valuation — which is up from a $33 billion price tag the fintech garnered in 2021 — comes after a bruising two years for fintech, which saw investors sour on the industry as profits came under pressure as central banks around the world hiked interest rates. At $40 billion, Revolut would be more valuable than rivals like Standard Chartered Plc and NatWest Group Plc.
The work on the sale comes just weeks after Revolut said its revenue in 2023 almost doubled to £1.8 billion ($2.2 billion). That fueled record pretax profit of £438 million for the year, which compared with a pretax loss of £25.4 million in 2022.
The latest results came well ahead of a statutory deadline to publish earnings, making it the first time in years that Revolut didn’t seek an extension to file its accounts.
That was seen as a key win in the fintech’s yearslong push to get a banking license from UK regulators that would allow it to expand its offerings in its home country. Getting its accounts in order has been seen as one of the crucial steps that could pave the way for that license.
“We’re working very very well with regulators,” Carlesi said. “I see a very collaborative relationship and part of this process is also building that relationship. Things are moving forward, we are working well and we have no concerns at this point.”
Carlesi said one of her primary focuses since joining Revolut in recent months has been on boosting the firm’s fraud controls. That work has taken on more importance as the UK prepares to introduce new rules that require banks and fintechs to reimburse consumers who fall victim to scammers.
While Revolut is readying itself for the new regime, it’s also building tools to try to stop fraudsters before they steal consumers’ money.
“It’s becoming increasingly sophisticated,” Carlesi said. “It is a national emergency, it needs to be fought like a normal crime.”
©2024 Bloomberg L.P.
