Monzo bank is a key market player in the U.K. with more than 4 million customers, now it has confirmed it has closed £60 million in top-up funding. But the paper value of the challenger bank now dropped from £2.0 billion to £1.25 billion.
This funding round was led by existing investors Y Combinator, General Catalyst, Accel, Stripe, Goodwater, Orange, Thrive and Passion Capital, along with new investors Reference Capital and Vanderbilt University.
The amount was likely meant as a top-up to the bank’s balance sheet, which is now about £175M in liquid capital (as Monzo is a licensed bank, it is required to hold at least 8% of its risk-weighted assets in liquid cash).
Monzo has also disclosed that it’s business banking product has reached about 25,000 signups. This product was introduced in March and is aimed at traders and SMEs.
Like many challenger banks and fintech companies, Monzo has been hit hard by the COVID-19 crisis. This even made the co-founder and CEO Tom Blomfield step down from the CEO position, although he was with Monzo from the beginning. Now he is moving to the newly established position of president to focus on the longterm vision of the company.
TS Anil the Monzo’s US CEO is going to become the CEO instead of Blomfield. Anil was previously assigned as the leader for the Monzo’s US push. He has 25-year financial services experience, previously he was Visa’s global head of payment products and platforms.
Check the full profile of TS Anil here: TS Anil, the new CEO of Monzo
Monzo was also forced to make job cuts of 80 positions as TS Anil explained that the current economic situation isn’t expected to revert back to normal quickly. The goal of the new CEO is to make Monzo cashflow positive by 2021.