Darktrace plans to go public in London despite Deliveroo’s IPO flop
A demonstration of Darktrace cybersecurity software shows how a global problem can start with just one workstation for one employee.
Michael S. Williamson | The Washington Post | Getty Images
LONDON – British cybersecurity startup Darktrace announced on Monday that it plans to go public in London, defying fears that Deliveroo’s disappointing IPO could deter other tech firms from listing in the city.
The London-based company’s platform uses artificial intelligence to detect and respond to cyber threats in a company’s IT systems. It’s said that its self-learning AI can monitor threats in real time and find ways to fight back.
Darktrace was founded in 2013 by a group of former intelligence experts and mathematicians and aims to get at least 20% of the issued share capital through an initial public offering on the premium market of the London Stock Exchange. This would make it suitable for inclusion in benchmark indices such as the FTSE 100.
“Our intention to be listed on the London Stock Exchange marks an important milestone in the history of Darktrace’s rapid growth and a historic day for the thriving UK technology sector,” said Poppy Gustafsson, CEO and co-founder of Darktrace.
“We are proud to be part of this tradition of British innovation as the UK becomes a leading global hub for AI development,” she added.
The Darktrace IPO announcement comes despite concerns over the lackluster market debut of Deliveroo, the Amazon-backed grocery shipping company. Deliveroo stock fell as much as 30% on the first day of trading, making it one of the worst IPOs in London for a large company.
Deliveroo’s IPO flop also threatened to embarrass British officials, who put their weight behind the company as it announced plans to go public in the city. London is keen to relax its listing requirements to attract higher-growth tech companies.
However, some analysts said Deliveroo’s problems may be limited to the company being haunted by employment rights concerns, rather than a broader indication of problems with London tech listings. Deliveroo said it is “just getting started as a public company” and is “confident” of generating long-term returns for shareholders.
Darktrace reported sales of $ 199.1 million for the fiscal year ended June. 30, 2020, up 45% from $ 137 million for the same period last year. Losses totaled $ 28.7 million, though that was less than the $ 34.7 million Darktrace lost in fiscal 2019.
Darktrace’s largest investor is Invoke Capital, the venture fund of British entrepreneur Mike Lynch. Lynch is currently at risk of possible extradition to the US for fraud related to the sale of Autonomy – the software company he founded – to Hewlett-Packard in 2011 for $ 11 billion. Lynch denies any wrongdoing.
Gustafsson and Chief Strategy Officer Nicole Eagan both worked at Autonomy. Darktrace shares the same office building as Invoke in London, but says Lynch is not directly involved in the day-to-day running of the company.
The company, most recently valued at $ 1.65 billion in its most recent private round of funding, has hired Jefferies, Berenberg and KKR Capital Markets to lead the IPO, with Needham & Company and Piper Sandler as joint bookrunners. It will use funds from the float to develop new products and strengthen its bottom line.