Mortgage advice and investment firm Squirrel is pondering a potential public listing next year.
Chief executive David Cunningham said it was a possibility some time in late 2027.
He said rather than to provide funding for the firm’s growth, the primary goal of listing would be to allow New Zealanders the potential to invest in a high-growth company.
“We’re too small for institutional investors generally, though I indicated we’re interested in talking to one or two cornerstone shareholders… it’s less about capital raising and more about the profile it gives Squirrel, which is already quite strong, the opportunity for New Zealanders to share in our success as a shareholder as well as an investor.
“If we go ahead, it’s more likely to be a direct listing, which basically means the existing 300 shareholders’ shares are sort of listed and then other New Zealanders could buy shares in Squirrel.”
He said the business was profitable and paying dividends, and growing strongly in all market segments.
The business raised money from crowdfunding platform Snowball in 2015 and some staff also held shares, he said.
“When you list it, you know, you have real price transparency. But equally, we’re under no illusion that we’re big enough for the big companies like the Forbars and Jardens and Craigs to research us, you generally have to be worth sort of $300 million. And we’re probably less than half that now.
“We’re well outside the NZX 50, for example… But, you know, we’d probably expect that one day we would be there.”
He said Squirrel had very diversified funding.
“Because we give access to mortgages, the largest asset pool in New Zealand outside houses, you know, everything’s on the bank balance sheets rather than something fund managers can invest in. We thin with the growth in KiwiSaver from $150 billion to $500 billion by 2040, providing mortgage assets that fund managers can invest in, but you need scale for them to be interested – that’s another opportunity.
“We have very few institutional investors today, in fact, only one or two, only a few million dollars, but that will grow substantially. But having wholesale funding, which is like bank warehouses, would be a big important part of our funding mix…we’re in the progress of establishing one as we speak.”
He said Squirrel had already taken care of many of the administrative requirements of a listing. “We’ve appointed a new board of directors earlier this year…we have public and annual report and have always been audited.
“It’s a complex process, but it’s just part of Squirrel’s evolution.”
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