Nik Storonsky, the CEO and co-founder of Revolut, is getting ready to sell off a portion of his multibillion-dollar paper wealth in the United Kingdom-based fintech’s impending secondary share offering.
The Financial Times reports that the banking app is preparing to sell USD 500 million worth of shares, allowing current owners—including staff members—to realise a portion of their gains at an estimated valuation of more than USD 40 billion.
Revolut would be by far the most valuable private company in Europe with that price tag, though the exact amount and valuation are still up in the air.
According to Sky News, Storonsky intends to profit in the tens or hundreds of millions of dollars, and other board members may follow suit.
The decision of a CEO and board members to sell down their stakes can be contentious, and this secondary sale will be closely watched as Revolut has emerged as the fintech industry’s crown jewel in the United Kingdom.
The fact that only current Revolut employees are eligible for the round and that former employees are not allowed to sell down their stakes is another contentious aspect. Revolut recently disclosed that it had turned a profit, bringing in 438 million pound (USD 553 million) and doubling its revenue to 1.8 billion pound (USD 2.27 billion).
A 46% increase in customers, bringing the company’s total to 38 million customers across the 38 countries it currently operates in, was cited by Storonsky as the reason for the company’s “exceptional financial performance.”
The fintech giant has also hit headlines in July due to other reasons. However, before discussing those developments, let’s have a quick brief about Nik Storonsky.
Who Is Nik Storonsky?
Nik Storonsky was born in Russia in 1984. He completed his Master of Science in General and Applied Physics at the Moscow Institute of Physics and Technology.
Storonsky was able to think analytically and have a thorough understanding of complex systems, because of his scientific training, which has helped him throughout his career.
Later on, Storonsky graduated from Moscow’s New Economic School with a Master of Applied Economics and Finance. The combination of his scientific and economic education prepared him for his success as a financial industry leader and entrepreneur in the future.
Nik Storonsky started his financial career as a trader at Lehman Brothers following his graduation. Later, he traded a variety of options, swaps, and foreign exchange instruments while employed at Credit Suisse.
Due to his trading background, Storonsky possessed a thorough understanding of global finance and the difficulties faced by individuals and companies requiring cross-border money transfers.
Storonsky envisions a world where financial services are available to everyone and money is not restricted by national boundaries through Revolut. His goal is to give customers and companies an easier way to transact without having to deal with cumbersome and complex traditional banking systems.
It’s possible that Storonsky’s love of travel and adventure sports had an impact on Revolut’s offerings. Along with access to airport lounges and travel insurance, the company also provides a budgeting tool to help customers save money for their next trip.
Additionally, Storonsky is dedicated to leveraging technology to improve the efficiency and accessibility of financial services, in addition to using state-of-the-art technology to give customers real-time transaction tracking and analytics.
Revolut’s Impact
The financial sector has been greatly impacted by Revolut. The company’s cutting-edge goods and services have put conventional banking systems under pressure and made them adjust to the shifting needs of customers. Due to Revolut’s success, other fintech businesses have been motivated to enter the market, increasing competition and stimulating creativity.
In the financial sector, Revolut’s success has not gone overlooked. Nik Storonsky is a well-known expert in his field who has won various honours and recognitions for his work with Revolut. He is number 906 on Forbes’ list of Billionaires for 2023, having a net worth of USD 3.03 billion as of May 2023. Forbes lists him on one of their prestigious lists of ‘who is who.’
In the financial sector, Revolut’s success has not gone overlooked. Revolut has won multiple accolades, including the title of overall winner of the Deloitte UK Technology Fast 50 award, in addition to being named the largest fintech company in the UK.
The innovative services and products offered by Revolut, like currency exchange, international money transfers, and surcharge-free ATM withdrawals, are partly responsible for its success.
Revolut has become a well-liked option for travellers and those requiring international money transfers thanks to these features.
In addition, Revolut provides investment choices, budgeting tools, and other financial services aimed at assisting consumers in improving their money management.
First Profit, IPO Talks And Many More
Revolut has finally registered a profit, as its revenues in 2023 almost doubled to 1.8 billion pound (USD 2.27 billion), helping it turn a pretax profit of 438 million pound (USD 553 million). This will provide relief to the fintech’s top-tier investors, including Index Ventures, SoftBank Vision Fund 2, and Balderton Capital, who have collectively poured over USD 2 billion into the company since 2015.
Revolut’s surge in profits was driven by a 46% jump in customers; 12 million new customers were added, bringing the total to 38 million across the now 38 countries in which Revolut operates. The feat powered a 59% increase in card and interchange fees (to 486 million pound) and a 46% rise in FX and the use of Revolut’s wealth platform, which includes crypto trading, to 395 million pound.
Revolut has also been working on securing a British banking license since 2021, and has repeatedly claimed that it would become an official bank “any day now.” The license is needed for the fintech venture to harness without its UK customer deposits to offer complex lending products, apart from enjoying the benefits of having the same customer deposit protections as official banks.
Revolut last completed a funding round in 2021, when SoftBank Vision Fund 2 and Tiger Global led an USD 800 million Series E funding round at a valuation of USD 33 billion. Revolut will “keep an open mind” on a potential listing venue as its latest financial results hinted at plans for a much-anticipated IPO. While Martin Gilbert, a veteran fund manager who joined the firm’s board in 2020, added that the venture was at least a year away from a stock market listing, the fintech company’s share sell will help it to rival the market capitalisations of FTSE 100 lenders Lloyds and Barclays.
Gilbert’s latest comments differ from those of Storonsky, who said in 2023 that he did not “see the point” of listing in London due to the United Kingdom’s regulatory environment. Storonsky added that he would likely choose New York’s Nasdaq exchange in the event of an IPO. As per the reports, Revolut’s top brass seems frustrated due to its more than three-year struggle with regulators (mainly Financial Conduct Authority) to secure the UK banking licence.
However, the Financial Conduct Authority (FCA) has now proposed making it easier for firms to use dual-class share structures, letting founders retain control despite selling down much of their stakes in an IPO. Talking about the IPO, Chief Financial Officer Victor Stinga earlier said that Revolut had “set solid foundations” that, in the long term, would “bring our financial processes in line with the standards expected from publicly listed companies”.