European Square rival iZettle is heading for a $225 million IPO
- iZettle has announced plans to list on the Nasdaq Stockholm stock exchange.
- The loss-making card terminal manufacturer hopes to raise $225 million in the listing to fund growth.
LONDON - Swedish card reading startup iZettle on Tuesday announced plans to list its shares on the Nasdaq Stockholm stock exchange.
iZettle plans to raise SEK 2 billion (€190 million, $225 million) selling shares to investors in the initial public offering. The funds will be used to "support the company's future growth and operational strategy," iZettle said.
iZettle was founded in 2010 in Stockholm and makes portable card readers that allow small businesses and sole traders to easily and cheaply take card payments. In recent years the company has also branched out into lending to businesses based on data collected from the card readers.
No guidance was given as to iZettle's potential valuation but the company did disclose its most recent financials. The loss-making company had revenues of SEK 966 million ($109.4 million) last year and said revenues grew by a compound annual rate of 56% between 2015 and 2017.
The company made a loss of SEK 232 million ($26.2 million) in 2017 on an adjusted earnings basis but said net margins improved from -84% in 2015 to -30% last year.
Jacob de Geer, CEO and co-founder of iZettle, said in a statement: "We are still in an extensive expansion phase and are in a unique position to make a difference for millions of small businesses in the markets that we serve.
"The IPO will provide us with improved access to capital markets to facilitate our continued growth and help us strengthen our profile with merchants, key business partners and in the fierce competition for talent."
iZettle's main rival is Jack Dorsey's Square, which produces similar payment terminals and also targets the small business market. Square has been expanding its presence in Europe in recent years.
iZettle said it is targeting annual revenue growth of 40% and hopes to reach a positive earnings position by 202o. The company had 413,000 active users last year, up from 344,000 in 2016.
Carnegie Investment Bank, JPMorgan, Barclays, ABG Sundal Collier, Nordea Bank, and KeyBanc Capital Markets are all working on the float.