Pre-IPO pedia|The $33 billion question: Can Revolut be the world's super fintech
As we mentioned in Eyes up IPO, European largest unicorn Klarna worth $45.6B, the online payment market is getting larger and larger. According to the Fintech Report 2021 – Digital Payments released by Statista, the size of the global digital payment market will be $5,474.6 billion in 2020 and will reach $1,0520.3 billion in 2025, with a compound annual growth rate of 14%.
Benefited by online payments, Revolut, a British digital banking giant founded only seven years ago, has become one of the world's well-known unicorns.
Based on its latest valuation, the company has become the fourth largest fintech unicorn in the world, behind Ant Group, Stripe and Klarna, according to research firm Crunchbase.
As the largest unicorn in the UK, Revolut is valued at more than NatWest, an old British bank.
How did Revolut create such a growth story?IPO Buzz takes you to the story of Revolut.
People often need to pay high currency conversion fees, handling fees and exchange rate differences when they go abroad to exchange money.
These fees are generated by the banking settlement and clearing system, but they are paid by customers.
On July 1, 2015, Revolut was co-founded by Nikolay Storonsky and Vlad Yatsenko in order to solve the problem of high exchange fees.
Nikolay Storonsky has said that the reality of what Revolut trying to achieve is to build a ten times better financial services. The company that is ten times cheaper as well.
Revolut mainly provides digital bank accounts and other financial services. At present, it supports the transfer and exchange services of various international currencies such as British pound, US dollar, Euro, Australian dollar and Singapore dollar.
Users can transfer money and consume through various channels, as well as trade cryptocurrencies and stocks.
Revolut's innovation lies in its global use and simultaneous management of multiple currencies. Revolut accounts can complete online shopping, deposits, transfers and other transactions worldwide, and with the help of physical cards, they can withdraw money from VISA-supported ATMs worldwide and register through mobile phones.
Revolut benefits users around the world who need to travel overseas, especially young people who often use mobile phones, thus saving time and transaction costs.
This is the main business of Revolut, and through the cooperation with MasterCard, Revolut's services can cover all parts of the world. In the mobile app, users can also apply for a physical card.
Revolut card is a prepaid card with a Mastercard logo, so they need to deposit enough money before spending. In addition, its exchange rate is based on the interbank exchange rate, which currently supports the real-time exchange of 30 currencies and consumption of more than 150 currencies.
Revolut has gradually become a virtual bank, offering deposit, travel insurance, personal housekeeper and other services, effectively replacing the daily business of many traditional banks, which is more attractive to young people who like new technology.
On the enterprise side, Revolut also provides convenient financial services for small and micro enterprises and individual households, including budget management, wage payment, etc., which improves efficiency and saves employers exchange costs.
Since July 2016, Revolut has raised more than a dozen rounds of financing. Major investors include SoftBank, Index Ventures, Molten Ventures, Seedrs, Ribbit Capital, etc.
Following financing are highly concerned by the investers.
On 14 July 2016, Revolut Ltd. A round of financing led by Balderton Capital.
On July 11, 2017, Revolut Ltd. It received a $66 million investment led by Index Venture Capital.
In July 2021, Revolut completed an $800 million E round of financing from Softbank.
Revolut has been favored by the capital market since its foundation, with a valuation of $1.8 billion in the C round of financing in 2018, reaching the level of TransferWise, another financial technology darling, in just three years.
In 2021, it was valued at $33 billion after an $800 million capital injection from venture capital institutions such as Softbank. For this financing, Mikko Salovaara, chief financial officer at Revolut has called the fundraising environment “very strong”. That's probably an understatement. They decided to take advantage of it.
Revolut's users growth has been impressive. Except for the stagnation of user growth caused by the COVID-19 in 2020, the rest of the time has a higher growth rate.
Revolut is in good financial shape, with rapid revenue growth. The net loss for the year is mounting, as the company's loss widened rapidly in the first half of 2020 due to the impact of COVID-19.
However, the company's financial statement shows that it has reached break-even in November 2020 and made profits in the last two months of 2020.
After raising $800 million in August 2021, Revolut's CFO, Mikko Salovaara, said that after the completion of the huge financing, Revolut did not plan to go public immediately and that the possibility of an initial IPO this year was extremely small.
But Nikolay Storonsky, Revolut's CEO and founder, said company revenue grows by another billion dollars, an IPO will be in consideration. He reiterated that Revolut was always aiming for a public listing in the UK and the US, possibly a dual listing.
Given that the company's 2020 revenue has already reached £222 million ($301 million), it seems that this goal is not difficult to achieve when combined with the company's growth trend.
If Revolut succeeds in listing in the UK, it will become one of the most valuable companies on the London Stock Exchange.
Mooers, have you ever used Revolut? As a blockchain fintech company, are you optimistic about its development prospects? Would you invest in Revolut, the UK's biggest unicorn, if it goes public? Follow me to join the latest discussion!
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Riding the IPO wave, and find the new bull!
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BullRunner : There is so many IPO’s its hard too keep up with them or even have enough cash at the time. I wish knowing news post know’s the ticker should post it if known. I also like Spac’s that can turn a awesome private one into a reverse split and making profit asap.
Sakura1988 : no
tom777 : Regular user of Revolut. Super for currency exchange and its link with Garmin Pay really helps life. Only issue is the limitations imposed by Singapore government.