UK Regulated Challenger Bank Monzo Announced new Financing Round and more than 20,000 Current Account Holders
UK challenger bank Monzo has announced a £71 million ($93 million) investment round as its customer base continues to grow at pace. User numbers have increased by close to 300%, from 120,000 to 470,000, since the company’s last fundraise just nine months ago.
A transparent, community-focussed approach and commitment to world-leading customer service has helped Monzo win favour with its half a million users since the launch of its beta prepaid card back in October 2015. However, the prepaid card was only a precursor to the company’s ultimate goal: to build a financial control centre for one billion people, and give them visibility, choice and control over their money.
This latest round attracted strong interest from US investors, with investments from Goodwater Capital, Stripe, and Michael Moritz, through his charitable investment vehicles including the Crankstart Foundation. In addition, Passion Capital, Thrive Capital and Orange Digital Ventures all also made follow-on investments. Following the new financing, the company is valued at £280 million ($366 million), doubling its valuation after its last round in February 2017.
The funding will be used to bolster Monzo’s hiring efforts, as the team works hard to support its growing user base, roll-out current accounts, and build its marketplace offering. Based in Monzo’s London HQ, the team now numbers 210, more than double the 80 people employed at the time of the last round. Monzo CEO Tom Blomfield said, “This is an incredible endorsement of our strategy so far, and sets us up to continue the growth we’ve seen this year into 2018.
We want to make it as easy as possible for people to manage and make the most of their money, to give people total visibility and control over all of their finances, and offer them their pick of the best products that the market has to offer. To help us achieve our ambition, we will continue to hire talented people, focus on building the best product, and bring Monzo to as many people as possible. We’re grateful and flattered to be joined by such high-calibre investors, who have unparalleled experience in growing and scaling globally-successful businesses.” Chi-Hua Chien, Managing Partner of Goodwater Capital said, “Monzo’s growth in the UK has been incredible, and the fact that it’s been driven by word of mouth makes it even more exciting. Customers love Monzo because the company treats them right, solves their problems, and does so with total transparency. These values express themselves powerfully through Monzo’s leadership team, world-class product and innovative services.
Monzo is already making it as simple and seamless as possible for almost half a million people to manage their money, and we’re looking forward to helping the team bring Monzo to millions more, in the UK and beyond.” £1.5 million ($2 million) of this round has also been reserved to allow existing crowdfunding investors to increase their investment amounts if they choose. More than 8,000 people have invested in Monzo through crowdfunding, allowing the community to take a personal stake in their own bank. In March last year, Monzo raised £1 million ($1.3 million) in 96 seconds in what remains the quickest crowdfunding campaign in history. The company also has further plans to launch a large crowdfunding campaign in 2018, to give as many people as possible the opportunity to invest.
As the UK prepares to lead the world and financial services sector with the imminent arrival of new open banking regulations, Monzo has already begun bringing current accounts to existing users, a process that will be complete before the end of the year. The wider public can now download the app to join the waiting list for current accounts, which will be offered to new users at the start of 2018.
Monzo (previously Mondo) is a bank for people who live their lives on their smartphones, and is targeted at people who want to get things done in a click and who don’t see the need for branches and cheque books. Monzo is focussed on building the best current account in the world and ultimately working with a range of other providers so that Monzo can be an intelligent hub for your entire financial life.
Source: Monzo press release