Zopa won’t commit to London for IPO

Zopa, the digital bank and former P2P lender, may not list in London when it finally raises cash from investors via an IPO.

Zopa’s chief executive Jaidev Janardana told City AM that he would not commit to a London IPO, instead pointing to “alluring and deeper pools of capital in other, unspecified shores.”

Zopa’s wariness about listing in London is part of a wider trend where UK businesses are avoiding the London market. For example, UK tech player ARM plans to list in the US where company valuations tend to be higher than in the UK.

An IPO for Zopa has been on the agenda for several years but Zopa has delayed previous plans due to the pandemic and challenging economic conditions. “We will just have to wait for when the markets are in the right place,” said Janardana at a conference last year. “You only want to do an IPO once, so we want to make sure we pick the right moment.”

Read more: Zopa backer says bank needs to strike balance between profit and growth

Another former P2P lender, FundingCircle, listed in London in 2018 while alternative property lender, LendInvest, listed in 2021. FundingCircle’s share price has fallen by more than 85 per cent since its IPO, while shares in LendInvest have more than halved since listing.

Whilst waiting for an IPO, Zopa has been able to raise cash from private equity investors. The digital bank raised £75m earlier this year which it used to purchase DivideBuy, a buy-now-pay-later provider.

Read more: Zopa Bank, two years on

Since launching in 2020, Zopa bank has attracted £3bn in deposits, more than £2bn of loans on balance sheet, and issued close to 400,000 credit cards.