A bumper year for initial public offerings (IPOs) in 2021 was followed by a relatively slow 2022 for London public market debuts. Now, amid turbulent economic headwinds, all eyes are on how the UK’s public markets will perform in 2023 — and which tech companies are likely to IPO.
Some UK tech companies have openly put their IPO plans on pause. Durham-based challenger bank Atom had previously been aiming for an IPO or other “liquidity event” in 2023, but the tech company has since shelved its plans until 2024 or 2025.
Others have recently braved the stormy economic conditions in which public and private markets have been battered by soaring inflation and rising interest rates. One of those is Berkshire-based semiconductor company Sondrel, which listed on London’s junior AIM market last October.
But who might be next? Here are four UK tech businesses that could list in 2023.
Arm
The semiconductor design company, owned by Japanese conglomerate Softbank, has been known for a while to be gearing up for an IPO — and to much political wrangling.
Arm’s head of investor relations, Ian Thornton, previously said that the IPO would be unlikely to happen before the end of March due to “current global economic uncertainty”.
In anticipation of its listing Arm recently appointed ex-Qualcomm and Intel executives as board members.
The big question around Arm’s IPO is ‘where’, rather than ‘when’. Securing a London IPO for the Cambridge-founded tech company has become a priority for the UK government. However, SoftBank CEO Masayoshi Son is said to prefer New York, as multiple prime ministers — most recently Rishi Sunak — have lobbied for a London IPO. Another possibility is a dual listing in both London and New York.
Revolut
The London-based fintech is striving to be an all-encompassing financial “super app” and has undergone a period of rapid growth. There are signs it is heading towards an IPO. Las year, Revolut posted a head of investor relations job advert that required applicants to have knowledge of publicly run companies.
Revolut told UKTN it was unable to comment on a potential listing this year.
“Our focus is not on if, when or where we will IPO. Right now, we are focused on continuing to strengthen our governance framework, profitability, building new products, and providing better and cheaper services to serve our growing global customer base,” a Revolut spokesperson said.
A more pressing priority for Revolut is securing its UK banking licence after a two-year application process.
Revolut founder and CEO Nikolay Storonsky has previously said the company is profitable and does not need to raise additional funds.
Starling
At the start of the year, Starling said it anticipates pre-tax profits to have grown more than four times. Founded in 2014, Starling is still a relatively rare beast in the challenger bank world because it is profitable.
In July Starling announced it had achieved its first full year of profit, with a pre-tax profit of £32.1m. A Starling spokesperson didn’t rule out a 2023 IPO, but said it’s not in immediate need for capital.
A spokesperson for Starling told UKTN: “An IPO remains one possibility, among others. Fortunately, Starling is profitable and well-capitalised; it is generating its own capital so has no need to go to the markets for funding. It’s a good position to be in. The markets have not been kind to recent IPOs; timing is all.”
Starling last month revealed it will be opening a new Manchester office, alongside existing bases in London, Southampton, Cardiff and Dublin, which will create around 1,000 jobs.
Zopa
Zopa, which provides deposit accounts and credit cards, has previously spoken about being “ready” for a listing in the final quarter of 2022. That did not come to fruition, which could mean the London-based firm is ready for an IPO as soon as this quarter.
When contacted by UKTN, a Zopa representative said there were no updates.
Last year, Zopa became profitable only 21 months after it was issued its full UK banking licence and entered the BNPL ring.
Founded in 2005, the fintech company has approximately $778m in total funding, according to Dealroom estimates, and became a unicorn back in October 2021.
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