Funding Circle founders from left to right: Samir Desai, James Meekings and Andrew Mullinger.

Peer-to-peer lending platform Funding Circle announced plans for an initial public offering (IPO) on Monday.

The British start-up, which connects small and medium-sized businesses to investors, said it was looking to raise around £300 million ($387.4 million) by issuing new shares. Funding Circle's potential listing would happen on the London Stock Exchange.

Heartland A/S, the private holding company of Danish billionaire Anders Holch Povlsen, has agreed to buy 10 percent of the issued share capital up to a maximum valuation of £1.65 billion. Povlsen is a major investor in online retailers Asos and Zalando.

"At Funding Circle our mission is to build a better financial world. Today's announcement is the start of the next stage in our exciting and transformational journey. Over the last eight years, we have worked hard to build a platform that is number one in every market we operate in," Samir Desai, CEO of Funding Circle, said in a statement on Monday.

Bank of America Merrill Lynch, Goldman Sachs, Morgan Stanley and Numis Securities have been signed up to act as bookrunners.

Funding Circle operates in the U.K., the U.S., Germany and the Netherlands.