Investment bank Peel Hunt has announced that Retailbook, the company it founded to give retail investors access to IPOs, has raised £2.5m as it expects imminent authorisation from the City regulator.
Peel Hunt said the fundraise proceeds would go towards Retailbook’s “next stage” of growth and provide the regulatory capital it needs for authorisation from the Financial Conduct Authority (FCA).
The firm said it expected to receive FCA authorisation “shortly”, anticipating that Retailbook would begin operating independently of the Peel Hunt group in the coming months.
The broker struck a deal last February with rivals Rothschild, Numis, Hargreaves Lansdown and Jefferies to create Retailbook. Exeter-based Crowdcube joined the alliance of brokers last July.
Retailbook was established as a new legal entity to own and operate a deal platform based on Peel Hunt’s existing REX technology. The tech was designed to enable retail investors to participate in capital markets transactions such as IPOs and follow-on share offerings.
Primarybid, which exploded in popularity during the Covid-19 pandemic and is backed by the London Stock Exchange and Softbank, has been one of its key rivals.
Retailbook’s fundraise was achieved through an issue of new ordinary shares to strategic investors, including “certain existing collaboration partners”, as well as individual investors.
Darren Carter, a non-executive director of Peel Hunt, has invested £772,000, while Peel Hunt chief executive Steven Fine and Retailbook CEO Aaqib Mirza have invested £100,000 and £75,000 respectively.
Peel Hunt is set to hold a “significant” minority stake in Retailbook after it participated in the fundraise.
The news comes as the government is trying to drive retail investment in capital markets to boost activity in the capital.
London’s stock market has been hit by heavy investor outflows, few big-ticket IPOs and a string of companies snubbing the capital for listings overseas.
Just 23 firms were listed in London last year. This figure was down from 45 in 2022, which itself was a 62 per cent drop compared with a record 119 listings in 2021.