Revolut investors cash in with $1bn share sale
Backers of Revolut have offloaded just shy of $1bn worth of stock in the neobank in just four months, after it extended its secondary share sale for the second time earlier this month.
The investors, which largely comprise staff, venture capital backers and crowdfunding round participants, have looked to cash in on parts of their holdings, gains on which have been restricted to paper until the sale.
The secondary sale was kicked off after the fintech won its hard-fought-for banking licence, which Revlolut leadership first applied for three years ago, with institutional investors like the state-owned Abu Dhabi investor Mubadala taking up a stake in the business for the first time.
City PM was the first to report that Revolut had opened up the sale to its crowdfunding investors earlier this month, after the neobank was threatened with legal action by equity crowdfunding platform Republic.
The bank used Crowdcube as well as Republic to raise money from retail investors in its earliest stages. Investors who used Crowdcube to back Revolut during a funding round in 2016 are now sitting on a 400 times return; a gain which almost all of them have been unable to crystallise until now.
The secondary round was originally limited to current employees in the summer, before being extended to former employees and then early-stage investors, allowing all three categories to realise gains – often of considerable sums – that had hitherto been restricted to paper.
Early venture capital investors have also sold around $500m (£395m) worth of stock as part of the round, according to the Financial Times, meaning the total amount of share sales is likely to surpass $1bn (£791m) by the time it closes.
Revolut has taken a cut of the proceeds from a portion of the share sales to cover the costs of overseeing the round, with former staff asked to pay a two per cent transaction fee if they wanted to exit from or sell down their stakes, the Financial Times said.
Revolut declined to comment.