The fintech firm PensionBee is aiming for a listing on the London Stock Exchange that would value the company at up to £384m, despite the fact it has yet to make a profit.
The Times has reported that the company is looking to price its shares between 155p and 175p, when it lists on the high growth segment of the London Stock Exchange.
However this valuation has provoked surprised reactions from many in the pensions industry, who have questioned whether its revenue and business model justify this kind of valuation.
PensionBee allows customers to consolidate workplace pensions and offers them an app to manage their account. It was was founded by former Goldman Sachs and Morgan Stanley investment banker Romi Savova, after she had difficulty transfering one of her pensions from a former employer.
At the end of March the company had 137,000 active customers, a 77 per cent increase over the past 12 months. It has £1.65bn assets under administration, a 123 per cent year-on-year increase. The average pot size is £15,000.
However despite generating revenues of almost £6.3m, its pre-tax loss for the year was £13.5m.
Commenting on Twitter, chartered financial planner at Penney Ruddy & Winter David Penney said it was hard to see how these figures justified a valuation of between £246m and £384m.
Others pointed out that the at valuation was “punchy”, with many commenting that its business model was potentially at risk if other pension firms improved their mobile capability.
Many pointed out that firms like AJ Bell, Hargreaves Lansdown or interactive investor offered a similar service.
However financial planner Ed Gibson said: “For [those with] small pots, unadvised and no desire to pick investment it probably looks simpler and better than a pension platform.” He pointed out that with the latter investors pay platform fees, fund fees and dealing fees – which can make the transaction seem more complex.
PensionBee has offered its customer the opportunity to buy shares as part of its listing and so far more than 12,000 have registered.
If the company achieves this valuation it would make the 35-year old Savova a multi-millionaire, at least on paper. However Savova, along with her co-founder Jonathan Lister Parsons have committed not to sell shares in the business for almost two years after the listing.