Dispersion Holdings, an investment company specialising in decentralised finance (DeFi) and established by the co-founders of Argo Blockchain, is the latest IPO to hit the Aquis Stock Exchange Growth Market (AQSE) in London.
The flotation is expected to value Dispersion Holdings at approximately £25m. The company says it plans to raise approximately £10m before expenses, by way of a placing of 200 million ordinary shares at 5p each through Novum Securities and joint broker alongside Tennyson Securities. First dealings in the shares are expected to commence later this month.
What is DeFi and why does it matter?
DeFi is a disruptive technology that uses the blockchain and cryptocurrencies to remove financial intermediaries from transactions creating a quicker, cheaper, more efficient and more secure way of providing financial services. Most DeFi applications are built on top of Ethereum, the world’s second-largest cryptocurrency platform. Decentralised applications utilise smart contracts, digital programmes which autonomously facilitate contracts and transactions.
Dispersion Holdings was set up to identify investment opportunities in this high growth sector. The founders reckon that there is a sizable, and rapidly growing, potential market for the DeFi industry, with applications that include decentralised currency exchanges, lending platforms which use smart contracts to replace banks, and prediction markets which remove book-keepers. By August 2020, it was estimated that $7 billion was held in various DeFi platforms (source: medium.com).
The company’s directors have an established track record, experience and networks in the crypto currency sector, digital assets management and decentralised finance, as well as the media industry to drive value creation.
The Board of Directors includes Michael Edwards (Chief Executive Officer) – the co-founder of Argo Blockchain (LSE: ARB), Guild Esports (LSE: GILD) and Cellular Goods (LSE: CBX) and Timothy Le Druillenec, a Director of NFT Investments Plc.
The company’s board says it intends to address and mitigate some of the risks by using both its members’ extensive contacts in the DeFi space to search out those projects that have best mitigated the risks associated with DeFi as well as a portfolio approach to the sector.
Edwards said: “We are delighted and excited to be taking this bold step into DeFi, the new frontier of the fintech sector, with Dispersion Holdings’ listing on a public market. In a rapidly growing and ever-changing sector, our team of experts – from the worlds of cryptocurrency to entertainment – has a wealth of skills, experience and contacts to guide DeFi companies towards a bright future. Our carefully considered sector, geographical and investment focus will enable us to create value for our shareholders in this exciting industry of the future.”
Highlights of the Dispersion Holdings IPO
Dispersion Holdings will look to identify investment opportunities in the high growth fintech sector within the UK, the USA and Canada. The board says it intends to deploy the majority of the company’s cash resources in the acquisition of minority interests in a number of different, yet to be identified, companies in the broad fintech sector, and to apply expertise to the business operations and strategic plans of these companies.
The experience, operational skills and contacts of the board are intended to act as an accelerator to start-ups and early-stage companies to maximise their profit opportunity. It is anticipated that returns to shareholders will be delivered through a combination of an appreciation in the company’s share price and through the adoption of a progressive dividend policy.
Other non-executive directors of Dispersion Holdings include Mark Rutledge, CEO of Carraway Capital Corp., an investor with a decade’s worth of experience in the cryptoasset world and more than 25 years’ experience in structuring and financing technology start-ups, such as 20 Year Media, an early AI pioneer in chatbot technology; and Misha Sher, Vice-President of Sport and Entertainment at MediaCom, who brings a 15 year career in sponsorship, media and digital marketing, having negotiated in excess of $100 million in sponsorships and rights agreements across four continents.