London the ‘natural destination’ for an IPO, says ClearScore boss  – UKTN

The London Stock Exchange is the “natural destination” for an initial public offering (IPO) the CEO of ClearScore has said, as the company considers its options for a flotation.

Speaking to The Times, Justin Basini said while recent history has shown a lack of “homegrown growth equity” in London compared with the US public markets which “back those companies which could go global”, UK investors were starting to “wrap their heads around the opportunities to invest behind growth”. 

The fintech boss lauded the UK’s “vibrant” fintech sector, but acknowledged the challenge of attracting new capital to revitalise the stagnating London markets. 

ClearScore, which provides credit report services, secured a valuation of $700m (£540m) on the back of a $200m funding round in 2021. 

A listing in London from the company would provide an important source of optimism for UK markets, which in recent years have been more known for private equity takeovers and losing out on promising floatations to New York than blockbuster tech IPOs. 

Last year saw 18 listings across the main and alternative markets in London, 85% less than the record year of 2021 and the third successive drop in IPO activity in Britain. 

London has long been known for its impressive list of prominent fintechs, but there has been concern that the tech-friendly and cash-rich Nasdaq would be the more attractive choice for public listings – in December Revolut CEO Nikolay Storonsky said Britain’s stock market is “much worse” than the US and listing in London is “not rational”. 

Work has been done to simplify the regulatory burden on the UK’s public companies and encourage traditionally risk-averse British pension funds to boost the capital flow into its markets, but this has not yet yielded a major listing event to prove to global investors that London can compete. 

Whether ClearScore proves to be that blockbuster London IPO remains to be seen, with Basini saying the company expects to hit its optimal pre-float metrics in 18 months to two years. 

There is reason to believe that the London markets are more attractive than the wider narrative might suggest. Though the number of listings has been steadily dropping, IPO proceeds in 2024 tripled year-on-year, reaching £3.4bn. 

Meanwhile, the unpredictability of President Trump’s economic policy has rocked confidence in the US markets, with the Nasdaq down around 8% since the start of the year. 

Read more: Is it time to be bullish about the London stock market? 

Already have an account? Log in