Revolut CEO Criticizes UK Stock Exchange Amid Market Concerns

Revolut CEO Nikolay Storonsky Dismisses London IPO

In a striking revelation during a recent episode of the 20VC podcast, Nikolay Storonsky, the CEO of Revolut, openly criticized the prospects of listing the fintech giant on the London Stock Exchange (LSE). He branded the idea as "unreasonable", particularly in comparison to the more favorable conditions present in the U.S. market.

Challenges of Listing in London

Storonsky's comments reflect growing concerns over the UK's stock market environment. He pointed out two major factors that deter companies from considering an IPO in London:

• Stamp Duty: UK stock trades incur a 0.5% stamp duty, significantly raising the costs associated with listing.
• Liquidity Issues: The UK market suffers from limited liquidity, making the financial landscape less attractive for potential investors.

According to Storonsky, these factors contribute to an overall perception that the London market is less favorable for company listings. He emphasized, "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."

The Current State of the London Stock Exchange

These remarks come during a challenging time for the London Stock Exchange, which is facing a significant outflow of companies. A report from the Financial Times indicated that, in 2024, 88 companies have either delisted or shifted their primary listings from London's main board—the most substantial capital outflow since the financial crisis.

Despite ongoing reforms aimed at rejuvenating interest in the LSE, U.S. exchanges continue to attract British firms with their broader capital pools and heightened investor enthusiasm.

Revolut's Valuation and Expansion Plans

Revolut, now valued at $45 billion, recently secured a temporary UK banking license in June after a lengthy three-year wait. However, Storonsky stated emphatically that if he were launching the company in today’s climate, the U.S. would be his top choice for establishing a base of operations.

Expansion into the Digital Asset Sector

In addition to contemplating its listing options, Revolut is also making headway in the digital asset sector. This year, it launched the cryptocurrency-focused trading platform, Revolut X, initially in the UK, which has since expanded to serve 30 European markets.

Conclusion: The Future of Revolut and the UK Market

As Revolut continues to grow and adapt to the fast-paced fintech landscape, its leadership's perspective on public listings raises critical questions about the future viability of the London Stock Exchange as an attractive option for tech companies. With its competitive offerings and favorable conditions, the U.S. market seems poised to capture a greater share of international fintech ventures looking for public listings.