Starling CEO and founder Anne Boden’s decision to leave her post this month followed a dispute with investors after the digital bank’s valuation dropped more £1 billion, the Financial Times reported.
That drop — from £2.5 billion to between £1 billion and £1.5 billion — came when Jupiter Asset Management, an investor, sold its holding in the neobank at lower price than Starling’s valuation, people familiar with the matter told the outlet.
Jupiter decided to sell its shares to existing investors Chrysalis investment trust, which bought £20 million of the equity sold by Jupiter’s mid-cap fund.
When announcing her departure plans last month, however, Boden said she would step down June 30 to remove any potential conflict of interest between her role as CEO and her position as a shareholder. Boden holds a 4.9% stake in the business.
Boden was not pushed out, Starling said, according to the Financial Times.
“It was Anne’s decision to step aside as CEO,” said Starling’s chair, David Sproul. “Anne made the decision, with the support of the board, that her two roles as CEO and major shareholder were not compatible given the size of Starling today and its ambitions.”
Boden will remain a non-executive board member until John Mountain, Starling’s chief operating officer, takes over as the interim CEO at the end of the month.
“Separating my two roles is in the bank’s best interests. Handing over my responsibilities [as CEO] will enable me to focus on my position as a shareholder, championing Starling and ensuring we hold true to our values and vision,” she said at the time.
The company said at the time that it has begun “an international search for a permanent CEO and will update in due course.”
Boden made the May announcement after the fintech’s revenue more than doubled to £453 million, compared with £216 million, during the year that ended March 31. Starling reported a pretax profit of £195 million — a sixfold increase over the previous year.
However, Boden grew concerned about the possible decline in the value of her stake in the business and the 15% stake owned by the employees when Jupiter’s deal was being finalized, people familiar with the matter told the Financial Times.
Not everyone agreed with Boden's perspective on the matter, the publication said, citing someone familiar with the matter. It’s unclear which investors were among those who disagreed.
Eventually, Boden decided to step down after asserting that her concerns as a shareholder were unduly influencing her position as the CEO, the sources noted.
Jupiter decided to sell its stake in a bid to end investments in private companies through open-ended funds, the outlet reported.
U.K. fintech shake-ups
Boden’s departure comes at a time when U.K.-based fintechs are seeing some C-suite shakeups. Mike Salovaara, CFO of Revolut, announced in May that he would leave the digital bank for “personal reasons”, while James Radford, the CEO of the entity designed to host Revolut’s U.K. banking license, left the company weeks earlier.
Matt Briers, Wise CFO, will exit the company next year, while Kristo Käärmann, the firm’s CEO, will go on paternity leave in September.
Though Starling plans to go public, it’s not in a hurry Boden told CNBC last month.
“We’ve succeeded in disrupting an entire industry,” Boden told the outlet. “I’m immensely proud of these results, which are a testament to how far we have come as a team and how fast we’ve moved as a business.”
