Darktrace shares soar 40% on £1.7 billion IPO debut weeks after Deliveroo flop

Shares in security software group Darktrace soared on their London Stock Exchange debut just weeks after the Deliveroo float flop.

Shares in the group were launched this morning with a value of £1.7 billion, or 250p a share, but within minutes sources said they were trading at 350.4p.

That represented a paper gain of 40% for its new investors.

The company uses artificial intelligence developed by its team of Cambridge mathematicians to hunt for unusual patterns in companies’ IT systems which indicate a hack attack.

Its float came just weeks after Deliveroo’s disastrous IPO flop which saw shares plunge on Day One.

Darktrace lowered its pricing for the float from a rumoured £3 billion valuation, possibly influenced by concerns in the market about its connection to Dr Mike Lynch, the Autonomy founder facing US fraud charges. He denies the claims but his status as a founder investor in Darktrace and, until recently, an advisor to the firm, was said to be putting off some investors.

Today, chief executive Poppy Gustafsson did not shied from the Lynch connection.

In her statement launching the float, she paid tribute to his team at his Invoke Capital investment business.

“We owe much gratitude to the Invoke team for their pivotal role in the vision, technology, positioning and operational input in the early years without which today’s success would not have been possible,” she said.

Other investors include venture capitalists Balderton Capital, Talis Capital, Hoxton Ventures, Summit Partners, KKR, TenEleven Ventures, Insight Partners and Vitruvian.

Invoke is not allowed to sell stock for 180 days, while employees are subject to a 360 day lock-up.

Conditional dealings will begin in the shares today under the stock market code DARK with unconditional trading - in which ordinary retail investors can take part, starts on May 6.

Darktrace has raised £143.4 million and selling shareholders will raise £21.7 million.

It does not appear that the major shareholders have sold stock, although staff and management have done.

Jefferies, Berenberg and KKR Capital Markets are advisers on the float, with KKR’s corporate finance arm unusually holding that position despite also being an investor through its private equity wing.