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Longfin to Lists On The NASDAQ: (LFIN), the first FinTech IPO utilizing Reg “A”

  Andy Altahawi,Ph D – Contributor


Longfin to List on the NASDAQ: (LFIN), the first FinTech IPO utilizing Reg “A”


Please note that I own stock in “LFIN” so I have a conflict of interest.

Longfin has applied to list its Common Stock on the NASDAQ Capital Market (“NASDAQ”) under the symbol “LFIN.” The company has reported $40 million in revenue per its audited financials of 2016.

Clearly, Longfin's net revenues are more reflective of the scale of the business in any terms. Their growth rate is impressive, Longfin grew from $1.1 million in revenue in 2014 to $40 million in 2016 and also increase their geographic scope, this is a company that can serve large segment of the financial market.

Longfin has an innovative and disruptive business model. Longfin Corp is an independent finance and technology company (“FINTECH”) specializes in structured trade finance solutions and physical commodities finance solutions for finance houses and trading platforms for North America, South America and Africa regions and has acquired 100% of the global trade finance technology solution provider, its subsidiary Stampede Tradex Pte. Ltd., a Singapore incorporated entity (“Stampede”) and the acquisition has been consummated on June 19, 2017.

Longfin is very unique it’s primarily a Fintech House specializing in cutting edge treasury

solutions combining the power of Structured Finance / Trade Finance with the specializing in ART (Alternative Risk Transfer) for global financial markets.

LongFin and its subsidiary are a global Structured Finance Organizations pioneered in Trade Financing, Derivative Structured Products and Electronic Treasury Solutions on ultra-lowlatency platform across Asia, Europe and America. As per its business plan, its presence in the world’s leading markets will enable to offer clients’ access to nuances of the local markets while providing gateway to the global markets.

Global Trade Finance Market Size:

The Group estimates that, globally, a flow of some US$ 6.5–8 trillion of bank-intermediated trade finance was provided during 2011, of which around US$ 2.8 trillion was L/Cs. The global volume of cross-border commercial L/Cs should correspond closely with the volume of L/Cs recorded by SWIFT. On that basis, the global volume of cross border L/Cs was around US$ 2,800 billion in 2011 and 2012.

To put this in context, in 2014, the Bank for International Settlements estimated the global market for trade finance at between $6.5 trillion and $8 trillion. The global trade finance gap for 2015 is estimated at around $1.6 trillion. About $692 billion of this is in developing Asia (including India and the People’s Republic of China (PRC).

Global Structured Finance Market Size:

Structured financing refers to sophisticated, complex transactions that take place across global financial markets. Structured finance includes project financing, securitization, leveraged leasing, and structured risk transfers. The structured financing market has been in continuous tumult as financial markets rise and ebb.

Structured Finance 2016 Global Market Expected to Grow at CAGR 16.49% and Forecast to 2020.

[Sources: IMF; national data]

LongFin’s concept of business and success of products and services has been successfully tested by way of its subsidiary company Stampede’s historical operations. They have ready infrastructure in Singapore that provides significant operation capabilities in the near-term, allowing the company to focus on continuing operation. There extensive experience and market research has helped them identify their priorities and target clients to grow their business. There subsidiary is rapidly recognized as a premium technology provider and structured finance solutions provider in its existing global markets. They see that trade finance is a trillion dollar opportunity where the application of EMM is of paramount importance in having a cutting edge advantage. their platform solutions include FX debt swaps, debt syndication, trade flow

management and underwriting FX risk management. The global trade finance markets are all growth markets with increased focus on technology solutions that provide a stable outlook for both sales and profitability. They are currently focusing on expanding their global presence, increasing sales and revenue, marketing and market share.

The company is looking to raised $50 mill of capital at $5 per share, wide verity of investors including institutional investors, with a minimum investment per investor of $500. Most of the investors will come through the efforts of their marketing campaign on www.ipoflow.com. When investors inquired about the offering at the company’s website or IPOFLOW we refer them to members of the broker-dealer syndicate. Venkata S. Meenavalli, CEO and founder of Longfin, said: “Reg A+ is excellent because it democratizes access to capital for companies and for the little guys-investors who were never able to get into IPOs till now”. We have learned that Reg A+ offerings are far easier to make work for companies that have strong appeal to consumers and followers.

Note that I may buy or sell shares in LFIN in the aftermarket so I may have a conflict of interest when you read this article. As of the time of listing, I hold shares in LFIN. I am not recommending that you buy or sell this stock.

Andy Altahawi,Ph D is a seasoned investment banker. CEO of Adamson Brothers, Corp, which owns and operates www.ipoflow.com, we help CEOs raise capital via IPOs, Regulation A+ for Mid-Stage companies