Darktrace London Listing Sees Shares Leap 40%, Shoots Toward $3.3 Billion Valuation
Cybersecurity startup Darktrace, one of the U.K.’s most promising tech companies, has started trading on the London Stock Exchange, valuing the business at $2.3 billion. The company said Friday morning that it had raised $200 million as a result of the initial public offering (IPO).
Trading began at 8 a.m. London time under the ticker DARK and has had an auspicious opening, with shares trading up from $3.48 (250 pence) per share to $4.87 (350 pence) on opening. That would give it a market cap of $3.3 billion.
It’s an exciting start for the cybersecurity company, which had been dogged by the continuing allegations of fraud facing one of its key investors, Mike Lynch, who helped launch the company back in 2013. Lynch is facing extradition to the U.S. where he faces criminal charges relating to HP’s $11 billion acquisition of his old company Autonomy. Lynch has denied all wrongdoing. Reports had also raised issues around Darktrace’s hard-driving sales culture, while Forbes had previously reported on the abiding influence of Lynch and another former Darktrace director, Sushovan Hussain, who was convicted in the HP fraud case, though has been fighting an appeal. There were also allegations of sexual harassment within the startup.
Lynch and his wife together own 18% of Darktrace, while Hussain owns just below 3%.
The Darktrace offering will also be a boon for the London Stock Exchange, which has struggled to compete with New York and Hong Kong for high-growth tech listings, with food delivery startup Deliveroo’s IPO flop weighing on its prospects. Shares of the company slumped 30% on opening. That knocked $2.6 billion off the Amazon-backed company’s value.
“Our company is deeply rooted in the U.K.’s tradition of scientific and mathematic research, so we are especially proud to be listing on the London Stock Exchange,” said Poppy Gustafsson, chief executive of Darktrace. “This is a momentous day for Darktrace and for the U.K.’s unparalleled science and technology sector.
“Our mission has always been to apply fundamental technology to the universal challenge of cybersecurity and we would not have got to this point without the determination and dedication of our talented employee base, as well as the continuing loyalty and feedback from our customers. As we look to the future, we are eager to build on our AI technology and to accelerate its deployment in existing and new markets worldwide.”
Darktrace claims its artificial intelligence can learn how networks operate and then spot anomalies, with the ability to eradicate threats on its own without human intervention. It’s one of a handful of British tech companies worth more than $1 billion, in a country where few cybersecurity businesses grow so large or go public. Its past customers have included corporate giants like BT and HSBC.
The company says it plans to use its new funds to invest in its research center in Cambridge, U.K., and expand globally.