Monzo, previously reported on as one of numerous “challenger” banks in the U.K. with the objective of re-inventing the current account, has, as projected, revealed a new funding round.
Confirming most of the details from reporting earlier this week, the startup has raised £19.5 million, coming from U.S.-based Thrive Capital, London’s Passion Capital, and Orange Digital Ventures, the venture arm of telco Orange, participating with investments of £13 million, £5 million, and £1.5 million, respectively.
The company, based in London, is also all set to raise an additional £2.5 million through another equity crowdfunding campaign on Crowdcube. The combined round pins Monzo down for a pre-money valuation of £65 million.
Monzo’s earlier £1 million crowdfunding raise record-breakingly closed in 96 seconds, leaving little room for doubt or worry that its second such effort will also result in a success. In fact, the startup has made specific plans to deal with the anticipated demand:
Monzo will host a pre-registration period from February 28 – March 14 when any of its customers can express their interest in investing. The total amount pledged will be displayed in real-time on Monzo’s website, followed by a ballot to randomly select the people who’ll be able to authorise their investments from March 14.
The new combined funding, skyrocketing the total raised to £35 million, will be used by Monzo to prep for a complete bank rollout later this year. In its current form of operation, Monzo’s 100,000 plus users get access to a pre-paid MasterCard and accompanying iOS and Android apps. It offers users functions like tracking your spending in real time, viewing geolocation-marked transactions on a map, viewing spending by category and getting a graphical timeline of your overall expenditure.
According to Monzo, once it has launched a fully-fledged current account, it will initially make money by offering “transparent overdrafts without hidden fees or charges,” but plans to branch out away from traditional banking business models in the longer term. It says:
The company will aim to give its customers one-click access to a broad range of financial products from third parties as part of a move towards ‘banking as a marketplace.
This could very well be the seeds of a possible launch in the US sometime in the future, something that founder and CEO Tom Blomfield has hinted at wanting to do, multiple times. Having spent some time living in New York, his sojourn there actually laid the foundation for his coming into contact with Thrive Capital.
