Schroders Trims Revolut’s Valuation by 46% Amid Fintech Sector Slowdownby Fintech News Singapore April 25, 2023
Revolut, a UK-based fintech firm, faces a 46 percent reduction in the value of its stake held by Schroders Capital Global Innovation Trust, highlighting growing investor caution in the fintech sector. The company, which also operates in Singapore, has experienced a significant drop in valuation.
Schroders recently reported a £4.7 million (S$7.8 million) write-down in its 2022 results, reducing the valuation of the stake to £5.4 million (S$8.99 million) as of 31 December, down from £10.1 million (S$16.82 million) a year earlier.
This follows TriplePoint Venture Growth BDC’s decision to lower the value of its stake in Revolut by 15 percent last month. Despite Revolut’s first annual profit in 2021, its auditor expressed concerns over the accuracy and occurrence of nearly 75 percent of its 2021 revenue.
Revolut has dismissed speculation about its valuation, stating that since its last funding round at US$33 billion (S$44.03 billion), the company has continued to perform well in all markets, expand, and report its first profitable year. However, the UK fintech sector has experienced a decline in investment, from US$22 billion (S$29.36 billion) to US$17 billion (S$22.68 billion) in 2022, due to higher interest rates, inflation, and valuation drops affecting investor interest.
Revolut’s CEO, Nikolay Storonsky, claimed in July 2022 that the company had sufficient funding for two years and was profitable, allowing it to navigate the difficult fundraising landscape that has impacted rivals like Klarna, which has faced significant cuts to their market value.