Mind the Tech London 2024“Companies with $50 million in revenue per year can trade here and get attention from investors"
Mind the Tech London 2024
“Companies with $50 million in revenue per year can trade here and get attention from investors"
Julia Hoggett, CEO of the London Stock Exchange, spoke with Calcalist’s Yarden Rozanski at Calcalist and Bank Leumi’s Mind the Tech London conference. "The thought that guides us is not what we do in the capital market and stock exchanges, but what needs to be done to attract companies and especially new companies and technologies"
Julia Hoggett
(Photo: Alex Kolomoyski)
"The stock exchange in London is convenient - we have both companies and people who want to invest in them, there is capital available. Specifically in the Israeli context, it is very important for us to stand up and play a role. I myself come from the fintech world and am very aware of the importance of capital for these companies," said Julia Hoggett, CEO of the London Stock Exchange at Calcalist and Bank Leumi’s Mind the Tech London conference when asked about the London Stock Exchange and how it is connected to Israel and the tech sector.
According to her, "We are the largest market in Europe, three times more than the second largest market in Europe. We give access to institutions in Europe a five-hour flight away and can continue to manage it."
Hoggett also said, "If you're an Israeli unicorn, you can enter the FTSE 250 Index, which is difficult in New York. We see an increasing number of tech companies on the London Stock Exchange. Companies with $50 million in annual revenue can be traded here and get attention from investors."
What steps are you taking to develop tech in the stock market and the economy?
"We have carried out a very ambitious reform in the capital market and are taking quite a few steps to promote it. This is evidenced by the fact that we have the second largest institutional capital growth in the world. For example, 49% of the companies issued on the London Stock Exchange in the last five years have made follow-on fundraisings. In Nasdaq, the percentages are significantly lower.
"This means that these companies both grow and have access to capital. The reform is intended to further speed up follow-on fundraising. It is very suitable for tech companies that grow and develop quickly and need capital.
"Another thing is that we will be the first country in the world to allow the integration of the public and private markets, and it will be regulated. It's difficult for tech companies to get access to capital when they're private. We are creating a mixed market that will make it possible to trade shares in private companies and allow institutions to invest in them without being issued. Companies will have access to liquidity quickly without necessarily having to issue.
"The thought that guides us is not what we always do in the capital market and stock exchanges, but what needs to be done to attract the companies, especially new tech companies."
Yet, its often easier, especially for high-tech companies, to remain private, and of course everyone is eager issue during a good macro environment.
"It's true that there are more shareholders when you go public, but what we see is that Britain is a place where companies get continuous access to capital. Even at the beginning of the pandemic, we made it possible to raise working capital quickly. This is an illustration of how the market serves the companies. Another thing about the London Stock Exchange and the FTSE Index is that 36% of the companies are international and 60% of the investors are international, so you get international dispersion."
When Israeli tech companies think about an IPO, they first think of the Nasdaq. Do they have a place in the London Stock Exchange, including smaller companies?
"This is exactly the advantage of the United Kingdom; we have the AIM stock exchange, the largest market which by definition is intended for growth companies and there you also get attention from investors. With us, you enter the index because there are both FTSE 100 and FTSE 250. In the US you can be a very large company and still not be in the indexes. Regarding Israeli companies specifically, despite the large number of international investors that I mentioned, half of the investors are actually British institutions and this also shows the level of trust and appetite."
Five years from now, will we see more Israeli companies in London?
"We have had a team in Israel for a long time and it has always been one of our focus areas. I'm sure there will be more Israeli companies in the future in London. We are implementing a lot of innovation to realize this goal."
Watch the full exchange in the video above.
First published: 12:58, 19.09.24
