London’s listing rules are now faster, more flexible and more founder friendly. So why are the high-quality IPOs still not coming? And what does it mean for IR?
The FCA’s 2024 listing reforms resulted in a faster rulebook, a lower eligibility bar and more flexible dual-class structures. And yet the steady flow of high-quality listings the City had hoped for still hasn’t shown up in the numbers. I want to step back from the mechanics and ask a harder question, one that goes to the heart of what London is actually for: does our market need to bend to keep pace with the world’s largest, fastest-growing companies, and if it does, what exactly are we trading away? And what are the implications from an IR perspective?
A recent piece in The Economist made an argument that has stuck with me: it suggested that once a company gets large enough, the normal rules of shareholder capitalism stop applying to it. Above roughly a trillion dollars in value, the disciplining force of finance becomes too weak – and the political stakes of the firm too high – for the ordinary mechanics of corporate governance to hold. Among the sixteen listed companies that have crossed that threshold, the piece identified four distinct tribes.
There are the shareholder fundamentalists: Apple, Microsoft, Amazon and their peers, mostly founder-free, mostly American, mostly just trying to make money without an elaborate statement of purpose.
There are the corporate paternalists: firms like Google and Meta, where shareholders effectively defer to a founder or patriarch who they trust to know better than they do, even when that trust produces something as expensive as the metaverse.
There are the national champions, companies like Saudi Aramco and TSMC, whose scale makes them inseparable from the geopolitical fortunes of their home states.
And then there is the final, strangest tribe: the Hobbesian leviathans, where shareholders essentially hand over all their rights to a single figure who governs the company as he sees fit. Today that tribe has two members, and they are both run by Elon Musk.
A Wise lesson
I want to use Wise as the clearest illustration of what’s really at stake, because the popular narrative around its move to New York gets the story wrong. The assumption is that Wise left because London couldn’t deliver valuation, trading volumes or analyst coverage. But in reality, Wise was trading on a healthy rating with broad institutional support when it announced the move. What it actually lost – and gained – was governance.
When Wise floated in London in 2021, its dual class structure gave co-founder Kristo Kaarmann’s shares nine votes each, though that enhanced voting power was set to expire five years later. Bundled into the same shareholder vote that approved its eventual move to New York was a second measure extending those supervoting rights for another ten years. The two proposals were put to shareholders together, which is why one of Wise’s own co-founders, Taavet Hinrikus, publicly opposed the deal, arguing it entrenched disproportionate power in the hands of a few and diminished shareholder democracy. The vote passed anyway, overwhelmingly.
Strip away the noise and the lesson is simple: Wise didn’t leave because London failed it commercially, but because New York was willing to let its founder keep control for longer than London’s rules comfortably allowed. It’s about how much control founders are allowed to keep, and for how long.
For IROs, this has a very practical implication. If your board is weighing up a founder-led growth strategy, or fielding early interest from a controlling shareholder who wants enhanced voting rights, the conversation can no longer be framed purely around valuation multiples and index inclusion. You need a governance narrative that is honest about what your company is asking investors to accept – and how long that arrangement is meant to last. Wise’s own experience shows that bundling a sensitive extension into a much bigger vote, without a co-founder’s public backing, can still get you scrutiny and criticism on the way through, even when the vote itself passes comfortably. Sunset clauses need to mean what they say, and how they’re presented matters as much as whether shareholders ultimately approve them.
The Hobbesian question
Wise sits comfortably inside the paternalist tribe: enhanced votes for a founder who still has to answer to a board and to institutional shareholders, even if those shareholders have limited practical power, is a model London already tolerates, however uneasily.
The harder question is whether London should go further and accommodate something closer to the Hobbesian model that SpaceX and Tesla represent, where shareholders effectively consent to have no meaningful rights at all, in exchange for exposure to a founder’s vision. SpaceX listed on Nasdaq in June 2026 with a valuation of roughly $1.77 trn, one of the largest IPOs in history, despite posting billions in losses and Wall Street’s own analysts openly admitting they don’t expect it to generate free cash flow before the mid-2030s. None of that curbed record investor demand. Musk retains more than four fifths of the voting rights through a dual class structure that gives certain shares ten votes apiece.
I don’t think London should chase this model, and I say that as someone who argued for a more competitive, more flexible listing regime. There is a real difference between allowing founders enhanced control for a defined period – already permitted in the 2024 reforms – and building a market that’s comfortable with shareholders having effectively no recourse at all. The Hobbesian model works for now because investors are backing a specific individual’s judgement over the ordinary disciplines of governance. When that judgement is wrong, those left with the loss will be those who had no vote and no ability to object.
London’s entire commercial identity – the ‘my word is my bond’ reputation I wrote about a year ago – is built on being the market where that doesn’t happen. If we chase the leviathans by giving up the protections that make us trustworthy, we won’t have anything left to sell the next generation of IPO candidates when the Hobbesian model eventually has its reckoning.
That’s the case for holding the line. But I don’t think holding the line means standing still, and the next story shows why.
The back door
While SpaceX chose Nasdaq for its primary listing, it still wanted access to British capital, and it discovered a route to it without ever coming near London’s listing rules. Using the FCA’s new Public Offer Platform regime – which came into force in January 2026 to help smaller, unlisted UK companies raise growth capital – SpaceX sold just under $364 mn of shares directly to UK retail investors through Marex Financial, an FCA authorized POP operator. Retail brokers including Freetrade, AJ Bell, eToro and Hargreaves Lansdown used the platform to distribute shares to their customers.
Because SpaceX wasn’t seeking admission to a UK-regulated market, it didn’t need to produce a UK-approved prospectus. Marex instead published a shorter disclosure summary based on SpaceX’s US filings. It was the first time the POP regime had been used for a retail offer of this scale, and by all accounts it worked well for the investors who took part: UK retail allocations were filled, while orders in several European jurisdictions were scaled back or – in Korea’s case – zeroed entirely.
As a case study in market plumbing, it’s genuinely clever. But as a signal about where London sits in the global capital markets hierarchy, it raises a harder policy question, and I don’t think there’s a clean answer. The POP regime was built with growing UK companies in mind. Its first headline use was a foreign trillion-dollar company using it to harvest British retail demand while listing everything else three thousand miles away. There’s no easy answer to how open retail markets should be. Every version of this trade off – giving people access versus keeping them safe – has a real cost attached. I’d rather see UK retail investors trusted to make their own call on something like this, accepting that not every bet pays off, than see them shut out of opportunities that institutional money gets without a second thought. But that’s an easy position for me to hold. The people who have to answer for it when a liberalized market goes wrong aren’t the ones who argued for opening it up. That job falls to the regulator, and by extension to IR teams managing whatever fallout lands on their own retail shareholders.
For IR teams, the implication is that your retail base is no longer a captive audience defined by who happens to list on the LSE. UK retail investors now have a straightforward, FCA-sanctioned way to put money into whichever company excites them most, regardless of where it is listed. If you run IR for a UK domestic company competing for the same retail wallet as SpaceX – or the AI companies likely to follow it down a similar path – you are competing for attention against firms your own retail investors can already access within a few taps on an app. That should sharpen how we think about retail engagement: less Why should you buy our shares instead of leaving them on deposit? and more Why should you buy our shares instead of the SpaceX or OpenAI stock sitting in the same brokerage account?
It’s worth grounding this in where London’s own listings market actually stands: 2025 was, by most measures, London’s strongest year for IPO activity since 2021, with £1.9 bn ($2.6 bn) raised. That momentum carried over into 2026, with H1 proceeds more than trebling year-on-year, helped in part by the stamp duty exemption.
But two caveats are worth holding onto: delistings and departures, Wise among them, are still outpacing new arrivals, so the net picture is less rosy than the headline recovery suggests; and a market this sensitive to two or three large deals landing in the right quarter is not yet a durable recovery. Activity is genuinely picking up, but the roster of listed companies is still thinning, not growing.
Should London bend?
So, back to the question I opened with: should London weaken its protections to win the next generation of Hobbesian-era IPOs, the kind built for the likes of Elon Musk?
My view is that we’ve already made the right compromise, and the job now is to communicate it properly rather than loosen it further. What the 2024 reforms don’t allow, and what I don’t think they should allow, is the kind of indefinite, effectively unaccountable control that defines the Hobbesian tribe. London doesn’t need to become Nasdaq to compete. It needs to become confident and fluent in explaining why its version of founder control is the more durable one, and it needs IR professionals equipped to make that case company by company, not just at the regulatory level.
There are two places I think the effort should go next, and they’re aimed squarely at London Stock Exchange’s leadership.
- Make the sunset clause the headline, not the footnote. Wise’s supervoting extension became controversial largely because it was bundled into a much longer shareholder circular alongside the New York relisting vote. Any company using the 2024 rules’ enhanced voting provisions should be expected, formally or through market norms, to put the expiry date of that arrangement front and center in its governance disclosures, not leave IR teams to explain it retrospectively when a co-founder goes public with their objections.
- Extend POP oversight to match its new scale. The regime was designed for small, unlisted growth companies raising a few million pounds. It has now been used to move over $300 mn of UK retail money into a company with no UK listing obligations at all. That’s a legitimate innovation, but it deserves a proportionate look at disclosure and due diligence standards before it becomes the default route for every mega-cap US IPO seeking British retail demand.
None of this requires London to become something it isn’t. It requires us to be precise about the version of shareholder protection we’re selling, and disciplined about explaining it well. The tribes described in that Economist piece aren’t going away, and London was never going to win every company in the Hobbesian camp. But it can be the market that wins the paternalists who want real, time-limited control rather than a blank cheque, and the market retail investors trust precisely because its rules – unlike a platform built for a very different purpose – were built for the company standing in front of them.
Alex Dee is the former head of IR at LendInvest, Man Group and NEX Group, as well as a three-time IR Impact award winner.
