Revolut CEO Criticizes London Stock Exchange Listing Amid Market Concerns

Revolut's CEO Critiques London Stock Exchange's Attractiveness

In a recent episode of the 20VC podcast, Revolut's CEO, Nikolay Storonsky, expressed his concerns regarding the viability of listing on the London Stock Exchange (LSE), labeling it as "unreasonable" when compared to the prospects offered by the U.S. market. Storonsky specifically pointed out the detrimental effects of the UK's 0.5% stamp duty on stock trades and criticized the lack of liquidity in the LSE as major factors dissuading companies from pursuing initial public offerings (IPOs) in London.

Concerns Over UK Market Liquidity and Costs

Storonsky highlighted, "The liquidity in the UK is much poorer, making it far less attractive than the U.S., and the stamp duty makes listing costs significantly higher in the UK. It's unreasonable." His remarks come amidst a troubling trend for the LSE, which is currently experiencing a considerable outflow of listed companies.

Capital Outflow from London

According to Financial Times, 88 companies delisted or migrated their primary listings from London's main board in 2024 alone. This marks the largest capital exodus since the financial crisis of 2008.

Revolut's Prospective IPO Plans

With ongoing reforms aimed at making the UK more appealing for companies considering IPOs, many still find the U.S. markets more enticing due to their deeper capital pools and greater investor interest. Currently valued at $45 billion, Revolut has navigated through regulatory hurdles and obtained a temporary UK banking license after a lengthy three-year wait.

U.S. as the Base for Tech Startups

Reflecting on Revolut's trajectory, Storonsky remarked that if he were to start the company today, the U.S. would be his preferred base. This sentiment captures the ongoing challenges faced by UK-based fintechs when competing for global investment and growth opportunities.

Revolut's Expansion in the Digital Asset Sector

While IPO plans remain uncertain, Revolut continues to innovate and expand its services. The company has recently launched Revolut X, a cryptocurrency-focused trading platform, originally in the UK and now expanded to 30 European markets. This venture underlines Revolut's commitment to remaining at the forefront of fintech evolution.

Conclusion

Storonsky's insights shed light on the pressing need for the UK to enhance its market conditions if it hopes to retain and attract businesses considering an IPO. As Revolut explores its options, the distinction between the UK and U.S. markets becomes increasingly evident, paving the way for significant shifts in where fintech giants may choose to list in the future.