Revolut Eyes IPO with Potentially $40 Billion Valuation as CEO Prepares $500M Share Sale

By Thea Felicity

Jul 07, 2024 01:50 PM EDT

Revolut Eyes IPO with Potentially $40 Billion Valuation as CEO Prepares $500M Share Sale
A photograph arranged as an illustration in London on April 21, 2023 shows a detail of a card from mobile phone app-based "neo-bank" Revolut. - From digital bank Revolut to money-transfer group Wise and payments company Checkout, London is Europe's fintech champion and intends on keeping its crown despite Brexit fallout and declining investments.
(Photo : JUSTIN TALLIS/AFP via Getty Images)

British fintech giant Revolut is gearing up for a major industry move as its CEO, Nikolay Storonsky, prepares to sell part of his stake in a $500 million share sale, according to a report shared by Reuters.

The planned share sale, which includes shares held by employees, could potentially value Revolut at over $40 billion. Storonsky's exact stake in the company remains undisclosed, and the amount he will sell hinges on the valuation Revolut can secure from new investors and final decisions by the company itself.

Revolut has experienced strong growth recently, achieving great increases in profits and attracting more users. As a result of this growth, Revolut has established itself as the most valuable startup in Europe.

The digital finance app's financial success has been described by a record pre-tax profit of £438 million ($553.8 million) in 2023, driven by strong user growth and substantial income from interest-related activities. 

Despite its financial health, Revolut continues to face delays in obtaining a UK banking license, which it has pursued for three years.

READ MORE: Fintech Bankruptcy Locks Out 100,000 Americans With $265 Million in Deposits

Does Revolut have an IPO?

Axl reported that the company has been expressing intentions to eventually go public, although Victor Stinga, interim CFO, has refrained from providing a specific timeline for an initial public offering (IPO). 

Going public would provide Revolut with access to massive capital from public investors. This influx of funds could fuel further expansion, invest in new technologies, and acquire competitors or complementary businesses. 

Access to additional capital will be valuable for sustaining growth and innovation for a fintech company like Revolut, which operates in a highly competitive and rapidly evolving industry. 

IPO could also unlock shareholder value for Revolut's existing investors, including employees and early backers. Public market liquidity allows these stakeholders to monetize their investments, allowing them to realize gains on their holdings. 

However, going public also means Revolut would face heightened scrutiny from shareholders, analysts, and regulators. The pressure to deliver consistent earnings growth and shareholder returns could influence its decisions and operational focus. 

READ NEXT: Wise Shares Decline 10% Following Announcement of Lowered Revenue Expectations

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