Mode Global Holdings PLC, a Bitcoin banking app set up by the entrepreneur Jonathan Rowland, is planning to list on the standard segment of the LSE’s main market through an initial public offering (IPO) that is expected to see the firm valued at around £40mln.
On Wednesday, the company said it is planning to float around 25% of its share capital and raise £7.5mln in the IPO, with shares priced at 50p each. The proceeds of the float will be used to cover technology costs to develop the intellectual property of Mode’s platforms as well as fund marketing costs to build awareness of its services to businesses and consumers.
The money will also be used to cover costs arising from a European roll-out alongside other working capital.
Aside from its banking app, Mode also Bitcoin Jar, interest generating accounts for users to store Bitcoin, as well as business payment capabilities using Chinese apps WeChat and Alipay, the former of which also provides business marketing services through Mode.
Following its admission to the LSE, Mode said it will aim to launch a novel payments solution powered by Open Banking, a secure method of allowing providers access to financial information, to facilitate “direct and seamless transactions in traditional and digital currency between businesses and Mode users”. The firm said this will enable it to operate a “significantly more diversified revenue model than the challenger banks, including both 'regular' Fintech revenue streams in addition to a range of more stable and high value revenue sources”.
Mode also plans to develop a loyalty and rewards scheme for customers as well as integrating new payment capabilities and expand its client base by connecting more UK and European businesses to Chinese consumers.
Rowland, who founded Mode and serves as its chief executive, previously rose to prominence when his internet investment company Jellyworks boomed on its debut on the LSE during the dotcom boom in 2000, with the business being bought six months after the float. He is also co-founder and director of UK challenger business bank Redwood.
"Our announcement today demonstrates our ambition as well as confidence in our ability to leverage technology and talent to accelerate the digitalisation of finance. Mode's mission is to eliminate the fragmentation and friction that plague today's banking, payment, investment and loyalty industries”, Rowland said in a statement.
“We are seeing an accelerated transition to online and mobile payments in the new post-[coronavirus] era, and Mode plans to leverage this by offering superior financial services for consumers and businesses alike. Mode is set to become one the first financial services companies on the LSE Main Market with a consumer focused-digital offering. This is a major milestone for Mode, and a vital step in bringing credibility and transparency to both the Fintech and digital asset industries", he added.