London-based fintech company Monzo has successfully raised $430 million (£340 million) in a late stage funding round, as reported by the Financial Times. This funding has propelled Monzo to a post-money valuation of $5 billion (£4 billion). Established in 2015, Monzo offers UK current accounts, debit cards, and various financial products with a strong digital focus.
This recent investment is significant considering the decline in big funding rounds in the past year, particularly outside the realm of AI. According to Atomico’s latest report on European tech, startup funding plummeted to $45 billion in 2023 from $82 billion in 2022 and $100 billion in 2021. American VC firms have reduced their investments in European startups, causing a slowdown in funding from crossover investors like Tiger Global and Coatue.
Despite these challenges, Monzo has defied the odds with its latest funding round, spearheaded by Google’s CapitalG, the growth fund of Alphabet. GV, Google’s venture fund, along with HongShan Capital and existing investors like Passion Capital and Tencent, are also contributing to this round.
Although Monzo faced setbacks, including unsuccessful expansion attempts and a down round in 2020, the company has rebounded strongly. With a focus on its UK operations, Monzo’s revenue streams have diversified, leading to a post-money valuation of $4.5 billion in 2022.
Currently, Monzo serves nine million retail customers in the UK, adding two million customers in 2023 alone. The company also caters to 400,000 businesses for their banking needs. In addition to traditional banking services, Monzo offers savings accounts, investment opportunities, and credit products, aiming to be a comprehensive financial solution for its customers. Monzo claims to have achieved profitability in March 2023.
