Take a step forward with the IPO
France FinTech, the French fintech association, and its partner Euronext, the first pan-European market infrastructure, offer you this infographic on fintech financing thanks to the IPO.
If several financing routes are possible for start-ups in the sector, the stock market is an option to consider.
The advantages of the IPO
An opportunity to take a new step
Obstacles to the IPO
The objective reasons, but also contextual ones
visibility and recognition
- Open new markets
- Give visibility through the status of a listed company, thanks to public communication
- Increase attractiveness, particularly with regard to talent
- Strengthen the credibility of the company with its customers and partners
- Provide liquidity for historical shareholders
- Structuring its governance and financial management
Economic aspects
- Market volatility (e.g. geopolitical tensions, health crisis)
- Abundant liquidity in venture capital
- A number of underperformance during IPOs in 2021
Funding opportunity
- Benefit from a very large pool of institutional and individual investors
- Get access to secondary financing quickly
- Benefit from a diversification of financial instruments
- Facilitate external growth
- Opportunity to buy companies as a listed company, use of the share as a currency of exchange
Inherent aspects of the IPO
- Cost of an IPO
- Pre-IPO structuring required
- Communication & transparency obligations
mature tech ecosystem
- Actors with an international ambition who have sufficient maturity, having the will to put forward
- Many examples of outperformance at the IPO for companies in the technology sector
Last June, Euronext launched Euronext Tech Leaders, a segment bringing together more than 100 listed European tech champions. This initiative highlights the visibility and attractiveness of leading and high-growth technology companies to international investors, as well as a suite of services to support them throughout their listing journey.
Market aspects
- Waiting an ideal introductory window despite the long-term investment
Obstacles to the IPO
The objective but also contextual reasons
Economic aspects
- market volatility (e.g. geopolitical tensions, health crisis)
- abundant liquidity in venture capital
- a number of underperformance during IPOs in 2021
Inherent aspects of the IPO
- cost of an IPO
- the necessary pre-IPO structuring
- communication & transparency obligations
Market aspects
- waiting an ideal introductory window despite the long-term investment
Benefit from the levers of the IPO by respecting a few requirements
Short-term break-even point needed to be reached soon, although the project remains significant
Tight financial management
Future performance that should not be overestimated or underestimated.
A balanced budget to be found but ultimately beneficial for society.
Sufficient capitalization to provide liquidity
However, there are so-called “acclimatization” markets (Euronext Access, Euronext Growth) where the need for liquidity is less important.
A mature and buoyant market that investors know and understand
Regular and transparent communication
If the communication must be regular and nourished, it is above all a guarantee of visibility and notoriety in the long term.
A mobilization of leading resources
Managers are in fact very much in demand, especially upstream of the IPO. But once listed, the acquired independence is largely advantageous within the framework of the management of the company by the managers.
Points of attention to remember
The keys to a successful IPO!
BEWARE of the IPO if:
- The journey in private financing has been difficult
- There is no medium-long term vision
- There is a plan to sell the company in the short term
-
ANTICIPATE
– Prepare an action plan to be implemented
– Follow upstream support programs like the Techshare pre-IPO program*
– Identify the right window in the history of the company for its IPO project
– Choose a market and a listing place in line with the profile and objectives of the company
-
SURROUND YOURSELF
– Have a management team available
– Set up a specific board in line with investor expectations, in particular including independent directors
– Surround yourself with experienced advisers (investment banks, communication agency, legal advisers, auditors, etc.)
-
COMMUNICATE
– Build a convincing “equity story”
– Learn to communicate effectively and regularly
– Offer investors a fair valuation of your company
* TechShare is Euronext's pan-European training program which enables participants to acquire the knowledge and tools necessary to learn about the markets and continue to finance their growth.
To know more : gmordelet [at] euronext.com
We made this introduction because we thought it was the best way to manage the company without tension, for the shareholders and the employees of the first hour. We wanted to provide a path to liquidity for our investors, some of whom had been there since 2007, without necessarily exiting altogether.
This gave us access to large-scale contracts, which are not yet operational, and which we would not have obtained if we were not on the stock exchange.
Pieter van der Does
Co-founder and CEO of Adyen
September 27, 2018
On the occasion of Adyen's IPO on Euronext.
IPO of innovative financial companies
Euronext
Initial Public Offering
in february 1999
36 M€
market capitalization at IPO
+ 1%*
Euronext
947 M€
raised in June 2018
7 067M€
market capitalization at IPO
+ 577%*
Euronext
2 164M€
raised in April 2021
7 238M€
market capitalization at IPO
- 32%*
Euronext
14 M€
raised in November 1999
18 M€
market capitalization at IPO
+ 821%*
Euronext Growth
IPO by direct listing in June 2015
70 M€
market capitalization at IPO
- 26%*
Euronext
2 056M€
raised in April 2019
5 650M€
market capitalization at IPO
+ 90%*
Euronext
639 M€
raised in June 2014
2 161M€
market capitalization at IPO
+ 457%*
* Performance since IPO until 31/08/2022
Other innovative financial companies listed on the Euronext markets
Euronext: market leader
Euronext is a leading pan-European market infrastructure group, connecting European economies to global financial markets to accelerate innovation and sustainable growth. With nearly 2000 issuers and representing a total market capitalization of almost €6 trillion at the end of June 200, it has an unrivaled franchise of top-notch indices and a solid base of diversified, national and international clients. international.
In addition to its main regulated market, Euronext also manages growth markets (Euronext Growth & Access) which facilitate and simplify the listing of small and medium-sized companies.
The more than 750 listed tech companies have shown positive momentum in recent years. They represented 50% of the 2021 IPOs.
28 fintechs are now listed on the stock exchange for a total capitalization of €85 billion.
To know more : Raise Capital | euronext.com
Source: Euronext, aon October 31, 2022
About France FinTech
Created in 2015 on the initiative of entrepreneurs, France FinTech brings together companies using innovative and disruptive operational, technological or economic models aimed at addressing existing or emerging issues in the financial services industry and representing the main components of the sector. The association's mission is to promote excellence in the sector in France and abroad and to represent French fintechs to public authorities, the regulator and the ecosystem.
France FinTech is today the largest sectoral association of start-ups in France and in Europe. In addition to its actions on the regulatory and legislative grounds, its numerous publications, its workshops and various meetings, the association organizes each year the reference event of the ecosystem, Fintech R: Evolution.
France FinTech is a member of the AMF-ACPR Fintech Forum and a founding member of theEDFA (European Digital Finance Association).
