Reasons tech firms are overlooking the London Stock Exchange.

      British fintech company Wise announced this week its decision to move its primary listing from London to New York, becoming part of a growing trend of companies opting against the London Stock Exchange. UK chip manufacturer Arm went for a New York IPO in 2023, while food delivery giant Just Eat Takeaway left the LSE for Amsterdam in November. Sweden’s Klarna has revealed plans to go public in New York, following the example of fellow Stockholm tech company Spotify, which listed on the NYSE in 2018.

      The appeal? Higher valuations, larger capital pool, and a greater willingness to take risks.

      “The US economy continues to outperform the EU, and companies that list there are simply valued higher,” stated Victor Basta, managing partner at Artis Partners, to TNW.

      The figures support this assertion. The NYSE has a market capitalization of around $27 trillion, compared to only $3.5 trillion for the LSE.

      This scale—and the affluent investors it draws—prompted Arm to list in the US. Wise made a similar decision, according to CEO Kristo Käärmann, who indicated that the move would access “the largest market opportunity for our products today and provide better access to the world’s most extensive and liquid capital market.”

      In addition to growth potential, US investors are recognized for their willingness to make larger investments in growth-stage tech firms.

      “US investors grasp the concept of the ‘revenue-before-profit’ approach,” remarked British serial entrepreneur Andrey Korchak to TNW. “In Europe, however, there’s often an expectation to see revenue from the very beginning.”

      Korchak believes that this risk aversion hinders startup growth.

      “Europe simply lacks the same concentration of tech unicorns,” he stated. “When startups here reach a billion-dollar valuation, many still choose to list in the US.”

      Sean Reddington, co-founder of UK tech company Thrive, expressed concern that Wise’s listing in New York may exacerbate existing challenges.

      “Wise’s transition to the US indicates a troubling trend,” he noted. “It risks a ‘brain drain’ of capital and talent, making it tougher for growth-stage VCs to finance UK scaleups without a defined US exit strategy.”

      He urged the government to take immediate action, including offering “meaningful incentives” for tech companies to list in the UK.

      “If the rewards for a domestic IPO are diminished, more companies will be inclined to consider moving or listing abroad,” he said.

      The challenges facing Europe’s startups will be a prominent topic at the TNW Conference, scheduled for June 19-20 in Amsterdam. Tickets for the event are now available—use the code TNWXMEDIA2025 at checkout for a 30% discount.