Rob Lincolne

Monzo Bank's strategic masterclass in a changing economic landscape In a time when many FinTechs are tightening belts, #Monzo is taking bold steps forward. Their latest valuation increase to $5.9 billion via a secondary sale shows more than just strong investor confidence—it’s a showcase of strategic foresight. Key Highlights: 🔸 Enhancing Liquidity: By opting for a secondary sale, Monzo is bolstering its financial flexibility without diluting its valuation. This sets the stage for expansion, product innovation, and entering new markets (Europe and the US) with confidence. 🔸 IPO Preparation: These moves mirror public market transactions, allowing Monzo to both test investor appetite and educate the market about its unique growth potential ahead of any IPO ambitions. 🔸 Market Timing: Monzo’s valuation boost in favorable market conditions reflects financial prudence, setting a strong baseline for future rounds. As FinTech continues to face economic volatility, Monzo's strategic positioning proves that with the right moves, opportunities abound. Read the full blog: https://lnkd.in/dgdNHRBN #CInnovation #FintechInsights #FintechInnovation #FinanceInsights #BankingRevolution #DigitalTransformation #BankingInnovation #FinancialGrowth #Finance #Banking #NeoBanking #FinancialServices #Fintech #BankingNews #TechInFinance #FinancialNews

8

Monzo Bank is gearing up for a potential IPO, and the excitement is palpable! With key appointments like Tom Oldham, who played a pivotal role in Nubank’s NYSE listing, Monzo is clearly building a formidable leadership team to navigate this ambitious journey. Their $5.9 billion valuation demonstrates solid growth, and with over 11 million customers, the groundwork is set for growth in the competitive US and European markets. But why does this matter beyond Monzo? A successful IPO could reignite investor interest in fintech, setting a new trend for digital banks. It could also pressurize competitors like Revolut and Starling Bank to reconsider their own IPO timelines. For early investors and retail traders alike, this is an enticing proposition! The stakes are high, and if Monzo plays its cards right, it could redefine the fintech landscape. Are you ready for this potential game-changer?

1

Interesting comments from Marion King, Trustee of OBIE at the https://lnkd.in/ezwadQYJ yesterday, along with some great data points. “Open Banking together with Real time payments could and should provide a viable alternative to cards” “The Economic model, the pricing mechanism. How is this [open banking] paid for; who pays in the value chain. Because without an effective fair exchange of value the open banking market will not be able to afford consumer protection.” “So where are we now in bridging the gaps . . . . . Standing up the Future Entity, that is the replacement of open banking. That will be a central capability that will manage: the scheme, the trust framework, the standards basically the rules of the game and will liaise and interop with other open data sectors so it goes beyond just payments.” 17% of small businesses use open banking 1.5bn API calls in March 60% of API calls have a payment attached to it, gateway to enabling a transaction or a payment Estimated that UK Open Banking is worth around £4bn of growth and employs around 5,000 people. Tony Craddock Jan van Vonno The Payments Association Adam Cox Sindy Cain Georgina Wilczek

8

Monzo Bank Announces First Full Year of Profitability Amid Record Growth and Accelerates International Expansion Plans TS Anil, CEO of Monzo, said: “This was a landmark year of record growth for Monzo. We surpassed 9m personal customers and 400,000 business customers, launched game-changing new products, closed a £500m capital raise and, as planned, reported our first year of profitability. I’ve never believed in the idea that a company has to choose between either being mission-oriented or focused on business outcomes. FY2024 proved Monzo is doing both – and that our strategy of placing the customer at the heart of everything we do is working at scale. We’ve achieved scale, growth and profitability, and we have all the right components to seize the huge opportunity ahead.” https://lnkd.in/eKJ_2GnK #fintech #finance #banking #paytech #payments #fintechnews #paymentsnews

157

Monzo Bank’s "Year in Monzo" 2023 is a powerful example of how enriched transaction data can create deeply personalized user experiences. By analyzing over 8.5 million merchant transactions, Monzo crafted unique ‘eras’ that reflect users’ spending habits: - Merchant Era: Highlighting users in the top 5-20% of spenders at specific merchants. - Travel Era: For frequent travelers, defined by triggered trip reports or spending in multiple currencies. - Social Era: Celebrating the top 20% of users for Monzo-to-Monzo payments. Monzo also ensured relevance and personalization with the craft of data science - 15 eligible transactions set the bar for creating meaningful narratives, focusing on Eating Out, Shopping, and Entertainment. - Filtering out merchants with fewer than 1,000 unique transactions and updating over 6,000 merchant names to maintain accuracy. - Excluding sensitive categories like gambling, to ensure a positive experience. Through careful data curation, Monzo has transformed everyday spending into engaging, personalized stories—showing just how powerful transaction data can be. Full article about how they built it here: https://lnkd.in/eWWNNDtb Pan Hu, Shervin Sharifi Rad 👏 great to see banks spreading knowledge about merchant enrichment #fintech #banking #digitalbanking #monzo 

32

1 Comment

Lemon Raises £500K in Pre Seed Funding Round to Enable SMBs to Save Thousands on SaaS Spending Co-Founder and CEO of Lemon Matt Bird commented: “It’s clear that we’re going through a really interesting period for SMBs at the moment,. Taking into consideration the challenging economic landscape with funding drying up everywhere you turn, SMBs now need the tools and services to help them build better businesses as cost-efficiently as possible. With software being the third largest spend for an SMB, we really think Lemon can become a core part of how an SMB uses SaaS. https://lnkd.in/eHzkqN5v Koen Christiaens Edward Stevenson #fintech #finance #banking #paytech #payments #fintechnews #paymentsnews

25

Huge congrats to Gradient Labs 🥳 these #AI trailblazers have just secured £2.8 million in #SeedFunding 🫰 Backed by top investors – including the likes of LocalGlobe, and Monzo Bank co-founders Tom Blomfield and Jonas Templestein, Gradient Labs is set to transform how companies handle customer queries – aiming for up to 80% resolution without human intervention 😮 See what they’ve been up to 🚀 #ArtificialIntelligence #CustomerExperience #ScaleUpSuccess #NextlevelThinking

6

Monzo Bank Raises Additional $190 Million TS Anil, CEO of Monzo: “The huge interest we see from global investors is testament to the momentum and strength of our business model and the commitment of our teams, who put our customers at the heart of everything we do. With even more rocketfuel for our ambitions and exciting products in the pipeline, there’s no doubt in my mind that the best of Monzo is yet to come.” https://lnkd.in/etJWG4yq #fintech #finance #banking #paytech #payments #fintechnews #paymentsnews

10

Monzo Bank is the latest tech unicorn to achieve profitable growth after years of depending on large amounts of outside funding to fuel its growth. The company has posted a very nice profit of £15m, with revenues growing 2.5x and deposits growing 88%. Of course, like many fintechs they were helped by the higher interest rates in the last couple of years. But Monzo can take credit for being at the right scale when the interest rates shifted (which they did mostly through building the best customer experience in UK banking) and for pivoting to profitable growth at the right time. I've been a Monzo customer since its alpha days and even invested a bit in one of its crowdfunding rounds, so it's safe to say I'm a diehard fan. Still, I have to say they have never been as innovative and productive as they have in the last couple of years, finally building some revenue-generating products popular with customers. We will have to see if this trend continues, as interest rates are expected to fall over the next few quarters. https://lnkd.in/eHZ5Ayf2

13

2 Comments

Foundation 92 Announces Partnership With Tandem Bank to Deliver Financial Inclusion Alex Mollart, Chief Executive Officer at Tandem Bank, said: “Tandem is focussed on helping consumers transition to a lower carbon lifestyle. But that fight against climate change is nothing is people are left behind and are unable to join it. “Sustainability stands for so much more than just carbon emissions and creating a lasting impact across society is at the core of it. Financial skills and literacy are at the heart of the modern economy and our daily lives and yet so many lack basic skills or understanding – I’m proud Tandem can bring our expertise to help plug the gap. https://lnkd.in/eA6CukFb Tom Hutton #fintech #finance #banking #paytech #payments #fintechnews #paymentsnews

1

Monzo has made a profit for the first time, having seen its revenue increase dramatically over the past year. This contrasts with reports, also out today, lamenting that FinTechs or "Neobanks" have failed to dislodge the big banks because their main revenue streams come from payments. Today, Neobanks offer credit cards, loans and savings products so profitability may become increasingly achievable. Despite a wider service offering, most people will continue to use Neobanks alongside a primary account for the short term. They remain important though. FinTech has changed how banking is done and has improved the customer experience. It has opened up a new range of role types and career paths in the new organisations and also in longer established banks. Healy Hunt provides specialist recruitment services for FinTech professionals across Financial Services. https://lnkd.in/ezx2CNr4 #fintech #neobank #executivesearch #recruitment #startup #scaleup

1

13books Capital closes £121m fund to back Europe’s fintech startups. 📈 The fintech fund will back rounds from seed to Series A ranging from £1m to £7m. The close comes as VC investment in the UK has started to show signs of recovery from the slowdown over the past two years. Fintech in particular has recovered well, becoming the UK’s best-funded tech segment once again in the first quarter of 2024. ➡️ https://lnkd.in/diVkG9-7 🔗 #investment #fintech #funding #startups #europe #UKtech

11

Monzo's impressive valuation of $5.9 billion underscores the growing confidence in fintech, driven by strategic fundraising and market expansion. The secondary market sale not only rewards employees but also signals robust investor interest, positioning Monzo favorably against competitors like Revolut. As neobanks evolve, their ability to provide liquidity while delaying a public offering could redefine startup financing strategies. Continued focus on U.S. and European markets will be crucial for sustaining growth and competitive advantage. #fintech #neobanks #startupvaluation #monzo #secondarymarket #banking #crossborderpayments #financialeducation #Payments #openbanking #digitalbanking

4

UK-based #neobank Monzo Bank has reported its first full-year pre-tax profit, marking a significant milestone in its 2024 financial results. The company achieved a pre-tax #profit of £15.4 million, a stark contrast to the £119 million loss in 2022. This success is largely attributed to Monzo's lending products and high interest #rates in the UK. #Revenue also soared by 250% to £880 million. #Monzo is now setting its sights on Europe, establishing a new hub in Dublin as part of its broader European market #expansion strategy. This move follows significant #funding rounds, including $430 million in March and $190 million last month, pushing its valuation to $5.2 billion. While a portion of this #financing is aimed at cracking the U.S. market, Monzo’s expansion into Europe signifies a strategic shift towards #markets closer to home. Monzo’s customer base has grown by over 2.3 million, reaching 9.7 million, including 400,000 business customers. The company aims to increase its customer count to 11 million in the coming year. Despite potential challenges from economic uncertainties and fluctuating interest rates, Monzo’s leadership remains confident in its ability to thrive. This positive trend among #neobanks is echoed by rivals like Revolut and Brazil's Nubank, both of which have also reported strong #financial performances recently. #fintech #fintechnews #neobanking #financialresults https://lnkd.in/gbFn_9Ee

8

Monzo Bank recently introduced a new location-based fraud prevention feature. It’s a smart move. We’ve seen our financial services customers get tremendous results by using our location intelligence to prevent fraud. But a word of advice to others like Monzo Bank that want to leverage location in this way: To make location intel effective for preventing fraud, here are two critical questions you need to consider: 1️⃣ Can you detect location spoofing? When a new fraud prevention feature comes into play, fraudsters start looking for cracks. With location-based features, location spoofing is the most obvious vulnerability. If you can’t detect location spoofing, your solution is dead in the water. That’s why tamper-resistance is a must. But you also have to think about precision, which leads to the second question: 2️⃣ Is your location data precise enough to avoid false positives? If you’re using an imprecise form of location data like GPS (not even going to mention IP)... You could create a lot of false positives. Imagine a fraudster that lives in an apartment building. If you don’t have apartment-level precision, you might have to block the building’s whole footprint to block one fraudster. That’s a lot of good users that become collateral damage. I’m excited to see more people wake up to the potential of location for fighting fraud 💪 But you have to have an answer for location spoofing. And it has to be the right kind of location data.

33

2 Comments

Monzo Bank have hit HALF A MILLION business banking customers! 👏 🏦 🇬🇧 One in six new companies have applied for a Monzo Business account in the UK and they're ALSO announcing an expansion their business offering with Team. 📱 💳 The new Team offering means Monzo can now go even FURTHER to help more businesses take control of their finances AND better serve existing business customers as they grow - with NEW expense cards, bulk payments and SO MUCH MORE! 👨‍💻 TS Anil, CEO of Monzo, said: “The 5.5 million SMEs in the UK are the backbone of the economy, yet they’ve been traditionally overlooked by banks. Business owners need game-changing products that take away unnecessary paperwork and allow them to get on with the important task of growing their business. As we scale beyond 500,000 business customers we’re still as focussed on staying close to our business community as we’ve always been and building features that do the heavy lifting as they focus on what really matters to them. Team is the next step in this journey, with plenty more to come.” Read more on the link below! 👇 Irina Sukhikh Fernando Fanton Jordan Shwide Eleni Fragkiadaki Kushal Babla Matej Pfajfar Dr Greta G. Katherine Brittain #monzo #businessbanking #digitalbank #fintech #fintechnews #banking #neobank #expensemanagement #digitalpayments #bulkpayments

10

“Britons lost roughly £459.7m to APP fraud last year, according to banking trade body UK Finance. However, some experts believe the true figure is likely closer to £700m as around a third of scams are estimated to go unreported”. As the Payments Systems Regulator (PSR) gets closer to implementation with new measures aimed at protecting those who have lost money to fraud, the industry seems to be fighting back, with dozens of firms lobbying for the PSR to delay or scale back its proposals. Why? Few firms are not ready for implementation, others state that the costs associated with becoming compliant will now have to be passed on to the end-customer, and likely destroy the viability of these same firms. Completely agree with Tide Bank’s Chief Executive, Dr. Oliver Prill comment (included in Lars Mucklejohn‘s piece) on the state of play for fintechs and why this has become an increasingly pertinent topic for those dealing with fraud. It’s a situation that, as always, needs a balance struck between regulators and fintechs – it’s clear that both sides want to protect consumers and businesses from fraud, however as ever, the solution is not as clear-cut as it may look from the outside. City AM have really been on the money reporting the recent go-ons within fintech, and it's a necessity not to forget how much this industry can do, and how much more still needs to be done, to really elevate the financial experience for UK citizens and small businesses. https://lnkd.in/dkyjmtin #fintech Ali Youssef Helene Panzarino

10