Two London software companies, both worth billions, are losing money.
In their 2023 accounts, Quantexa and Paddle reported almost the same revenue: £57.9 million and £57.3 million.
Since then, their roads have split.
Quantexa has doubled its revenue to £126.4 million and says it’s “IPO-ready.”
Paddle says it was growing 40% year on year as of July 2025.
The real difference is how they earn.
Now, Quantexa sells software to banks and governments on big, long contracts, including £175 million from HMRC, and Paddle, on the other hand, keeps 5% plus 50 cents of every sale it handles for other software companies.
A few huge contracts, or a small cut of millions of sales.
Same size, same city, opposite bets.
Read the full breakdown of How Quantexa Makes Money and How Paddle Makes Money.
Also on EP+ this week:
→ Deliveroo floated at 390p and sold at 180p: The Deliveroo Founder Took the Order, DoorDash Took the Lot
→ [How Speechmatics makes money]: the voice AI you never see, billed from $0.12 an hour.
→ Neko Health raised $700 million to open its first New York clinic. What that says about who funds UK longevity.
→ Two clocks run out in 2027. Can UK nuclear companies beat the regulator’s?
→ The application fee is the smallest part. What UK crypto regulation could cost a startup’s runway.
→ When a co-founder leaves, the company can buy their shares back, but only by the rules: Company share buybacks.
→ Up to £20 million a year under EIS from April 2026, if you qualify as a knowledge intensive company.
The wider ecosystem: who gets to stay, and who gets to leave?
London’s IPO market got a real test last Friday.
Airtel Money listed at about £5.3 billion, which is the biggest London IPO in five years, and its shares slipped about 2% on day one.
It was also the first IPO above £1 billion since 2021, the year Deliveroo floated.
Two days later, City leaders warned the Chancellor , that the UK is becoming an “incubator nation”: a country that builds great companies, then loses them just as they get big.
That same Friday, Prime Minister Andy Burnham said the government will change the law so non-compete clauses stop blocking hiring, that’s the rule that stops people joining a rival or starting their own company for a set time after leaving a job.
20 founders had signed an open letter asking for it last month!
Nvidia pledged $250 million of computing power over five years for UK AI safety research, and none of it is cash. It also plans small stakes in five British startups: Boltz, Foresight, Hiverge, Prima Mente and Riverlane.
One Forrester analyst warned that small stakes like these still leave UK startups relying on foreign money to grow.
Meanwhile, UK venture funds raised a record $6.9 billion in the third quarter.
Oxford chip startup Salience Labs raised $125 million, and it’s also expanding in Silicon Valley.
One pattern we noticed
The money to start is rarely the problem; the money to finish is.
UK venture funds raised a record $6.9 billion in a single quarter.
Quantexa and Paddle are both valued in the billions, and Quantexa says it is IPO-ready.
Deliveroo floated at 390p and sold at 180p.
Airtel Money got London’s biggest IPO in five years, and its shares slipped on day one.
The cheque going in is easy to find, but the exit is where the price really gets decided.
One number
£600,000: the gap between Quantexa’s and Paddle’s revenue in their 2023 accounts.
Question of the week
Would you rather earn from a few huge contracts or a small cut of millions of sales?
Email us at [email protected] and tell us. We read every single answer, and yours might end up in next week’s brief.
Sources: EP+’s own reporting (Quantexa, Paddle, Deliveroo, Speechmatics, Neko Health, UK nuclear, UK crypto regulation, share buybacks, knowledge intensive companies); City AM (Airtel Money, incubator nation, Salience Labs); Briefs Finance and Bloomberg (non-competes); Tech Funding News and City AM (Nvidia); HSBC Innovation Banking UK and Dealroom (venture funds).
