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Trustpilot eyes £1 billion London IPO as founder hails capital’s booming tech scene

Naomi Ackerman
·3-min read
<p>The Government is keen for more tech companies to float in London (AFP/Getty)</p> (POOL/AFP via Getty Images)

The Government is keen for more tech companies to float in London (AFP/Getty)

(POOL/AFP via Getty Images)

The government’s hopes that more tech companies will float on the London Stock Exchange had a major boost on Monday as two new IPOs were launched with a combined value of around £1.1 billion.

Trustpilot is planning a London listing the online review platform hopes will see it valued at around £1 billion, according to people close to the company, while fashion e-tailer InTheStyle is targeting a £100 million valuation.

They follow a string of online lockdown winners planning listings in the City after seeing demand soar during the pandemic. Recent floats have included The Hut Group, online greetings card retailer Moonpig and auction platform ATG, while Deliveroo, Virgin Wines and others are all planning IPOs.

On Monday it emerged that former BT chief executive Sir Peter Bonfield has joined the board of cybersecurity group Darktrace in what is a further precursor to its hotly anticipated London float, which is expected to value the company at around £4 billion. The company has also lined up former Capita executive Gordon Hurst as float chairman to see the IPO through, Sky News has reported.

Trustpilot was launched in Denmark in 2007 by founder and chief executive Peter Holten Mühlmann, and has since become one of the world’s biggest platforms for online ratings of businesses and products - with more than 128 million reviews posted to date. It previously raised around $173million in private financing, and saw revenues of $102million from just over 20,000 paying business subscribers in 2020.

Businesses pay to host Trustpilot ratings on their websites.

Mühlmann told the Standard: “We examined a number of locations, and on balance London was the natural choice for us for a couple of reasons. The UK is one of our most important markets, and I think London is a growing tech scene. In the future I expect a lot of the significant tech IPOs will happen in London. The London stock market has a lot of liquidity, and they are exhibiting the right long term mindset on how they are looking at operating the listing rules.”

The Government is hoping tech floats will help drive Britain’s recovery, and is reviewing the rules for companies listing here to make it possible for founders to retain a “golden share” blocking unwanted takeovers.

Last week a Government-commissioned review by former Worldpay boss, Ron Kalifa, recommended such listing reforms. Sector leaders including Tech Nation chair Stephen Kelly have said there are multiple signs 2021 will be “a golden year for UK tech”. Recruiting giant Hays told the Standard last month that its business in London's tech sector has already risen above pre-pandemic levels.

Trustpilot has bases in London, Copenhagen and Edinburgh. The founder said he expects listing will also be a key “tool to incentivise staff and to continue to attract the best talent”.

The company said it hopes its IPO will raise around $50 million, which it would use to support growth plans and repay debts. On IPO it plans to have a free float of at least 25% of issued share capital, and to be admitted into the FTSE indices.

Mühlmann said Trustpilot has seen its consumer base soar by 30% above expected growth levels since pandemic lockdowns hit and economies pivoted online.

He said: “I think we are still at less than 1% of what we can become. In today’s world the entire economy is moving online… You need to show that you’re trusted, and to do so in a way that consumers trust.”

Trustpilot has faced challenges from sites like Which? over its ratings’ reliability. The platform has since banned incentivised reviews, and today the founder said that the site has automatically removed more than 1.5 million fake reviews.

Chairman Timothy Weller said the company’s “fast growth, a proven subscription-based business model and high gross margins underpinned by a modern, highly scalable technology platform” give it “all the attributes required to thrive as a listed business”.

J.P. Morgan and Morgan Stanley are joint sponsors, global co-ordinators and bookrunners on the IPO process, with Berenberg and Danske Bank also acting as bookrunners.

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