Funding Circle to raise £300m through IPO


(Alex Sherwood) #1

These guys have been steadily growing their share of the peer to peer business lending market & it’s great to see a UK based FinTech company going public.

This has also been covered by the: FT - The Telegraph - BBC.

I’d be curious to see who wants to invest in them, once they’re public?

  • I’ll invest :moneybag:
  • No way :no_good_woman:
  • I’m not sure yet :thinking:

0 voters


(Vladislav Kozub) #2

Seems like a rather risky business to me personally, with no profits for the last 7 years of operations (although their accounts go as far as 2010, they only started real operations in 2012).

Whilst the article is stating the following:

In the year ended 31 December 2017, Funding Circle posted revenues of £94.5 million, compared to £50.9 million in the previous year. In its 2016 full year results, published September last year, the company narrowed its losses to £35.7m, down from £36.9m in the in the previous year

The Companies House filings (page 11 of the actual PDF) significantly contradict the AltFi’s information - revenue in 2016 being £39m (not £50m) and operating losses being £53m (not £37m). Even if they meant net loss, the figures would still have not added up.

Interestingly, Companies House do not have their year 2017 yet (usually posted in October year after, i.e. we could expect 2017 accounts in October 2018), and, given discrepancies AltFi have already shown, I would be reluctant to take revenue growth and reduced losses for 2017 for granted and rather wait for the official accounts to be released.


(Alex Sherwood) #3

Here’s some more pessimistic analysis from an opinion piece in the FT -


(Alex Sherwood) #4

This might be of interest for anyone who’s interested in how the process of a company going public works, in terms of issuing shares, who can buy them, how many they have to offer, how much the CEO will make :eyes: etc. There’s some details of the lock up period (the time period when certain employees can’t sell their shares), that has been arranged too @Peter


(Denislav) #5

Never heard of Funding Circle but after having a look at it now it seems like an interesting idea and investing platform… Has anyone from this community ever invested with them? Any feedback?


(Alex Sherwood) #6

This valuation’s “higher than expected” so it looks like there’s some interest from the institutional investors :man_shrugging:


#7

What typically causes a price to rise on IPO day? Is there a segment of investors excluded from participating in the IPO and therefore have to buy on open market thus pushing the price up? Otherwise if people are optimistic about the company why not just participate in thr IPO?


#8

The lossmaking company — which connects small businesses seeking credit with private and institutional investors willing to lend to riskier borrowers for potentially higher returns — originally set a price range of 420p to 530p per share for its IPO. This would have valued it at up to £1.8bn.

Funding Circle, which is the first peer-to-peer lender to go public in the UK, has now narrowed that price range from 440p to 460p, giving a maximum valuation of £1.5bn.


(Josy-Baroness Boakye) #9

very useful. Thanks for sharing


#10

I’ve invested with them. One of the loans I’ve provided is with a property company and it’s currently 9 months late being paid back. The recoveries team are on it, however, I have no view when I will get my investment back.

I’ve not had the best experience. I run a business too and I get lots of marketing from them about offering loans with minimal checks.

It’s all about volume, making as many loans as possible as that’s how they make their money. Having experienced their conduct I wouldn’t touch this investment. I think their business model is broken


(Denislav) #11

Thank you for sharing your expriences, it good to hear someone who has invested with them. :slight_smile: It’s is a shame that you have had a bad experience :frowning: and I hope that good news comes out of it in the end. Good luck!


(Alex Sherwood) #12

This looks like a pretty good result for Funding Circle -