IPO: B2B Services Exchange Blur Group To List On LSE AIM

We knew it was potentially in the cards (see background) but now an IPO for the B2B Services Exchange, Blur Group, has become a reality: The company today announced that it’s to begin trading on LSE AIM this Friday.

It will consist of a placing of 4,878,049 new ordinary shares at a price of 82 pence ($1.33) per share, raising gross placing proceeds of $6.48 million (£4 million). This will give Blur Group a market cap of approximately $32.6 million (£20.1 million) based on the placing price for the entire issued and to be issued share capital of the company.

Here are some of the key points pulled from the official release (note that sales/revenue figures have been published for the first time):

● Blur Group owns and operates online exchanges where businesses in any country can buy, sell and pay for business services like marketing, advertising and technology. Businesses brief projects and expert service providers pitch for the project and the entire process runs online right through to project delivery and payment.

● In early 2010, when the Exchange formally launched, just over three briefs per month were submitted. In Q2 2012 this had risen to nearly 60 per month from companies like the AA, Coral, Exceed, Fantasy World, Red Commerce, Harvey Nichols, the Financial Times, Berlitz, Butlins, GE Healthcare and Tyco. Over the same time, average brief value has grown from approximately $1,500 in 2010 to an average for 2012 YTD of $11,000. Now more than 1,000 briefs have been submitted with a combined brief value of over $13.5 million, with these briefs coming from the US, UK, Europe, Africa and Asia.

● Today, blur Group has over 20,000 experts, agencies and service provider firms in over 130 countries on six crowd platforms who benefit from networking, peer advice as well as new business opportunities. All are reviewed and approved by the Group’s Exchange Support executives before joining. The Company is also building crowds of experts for legal and accounting services, with a view to accepting briefs for these services in H1 2013.

● Total sales for the six months ended 30 June 2012 were $1,502,000 with an increase in revenues of 75% to $975,000 (H1 2011: $557,000) and deferred revenues of $527,000. EBITDA for the first half was a loss of $483,000 (H1 2011: EBITDA loss of $152,000). The Group now employs 29 full time employees in London and Dallas.

● The purpose of the IPO is to facilitate access to capital to fund the next stage of the Group’s growth, raise the Group’s profile as an international technology leader and also support the Group’s long term strategic goals. The net proceeds of the Placing are intended to be used in technology development, corporate sales team growth, support services and marketing.

When the idea of an IPO was first mooted in August, Blur Group founder and CEO, Philip Letts, explained the rationale: “We thought the Angel to IPO route was more interesting in this new environment and more relevant for us. Probably more appropriate, assuming you can pull it off, for a company that wants to be a long term independent leader in its space – and ours is pretty big”, he said.

“Assuming you can pull it off”, indeed. And it looks like Blur Group is about to do just that.