- Startup bank Monzo raised £71 million ($93 million) in its second fundraising round this year. The company’s valuation has more than doubled, to £280 million ($336 million) since February. The new funding will be used to expand Monzo’s team, roll out current accounts, and allow crowdfunding investors to increase their investments if they choose.
LONDON – Startup bank Monzo raised £71 million ($93 million) in a new financing round, doubling its valuation since its last fundraising round in February.
The British company is now valued at £280 million ($336 million) and said it now has more than 20,000 current account holders. Total users have increase by nearly 300% since February’s Series C funding round, from 120,000 to 470,000.
“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,” said CEO Tom Bloomfield.
“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,” he said.
Monzo launched its prepaid card in October 2015, and in April obtained a full banking license, allowing it to provide current accounts. To date, customers have spent over £800 million ($1 billion) with their Monzo cards.
Investors in this latest funding round include Goodwater Capital, Stripe, Passion Capital, and venture capitalist Michael Moritz. The company said funding will be used to expand, roll out current accounts, and build its marketplace offering. Since February’s funding round, Monzo’s London team has more than doubled in size.
£1.5 million ($2 million) 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, and in March last year the bank raised £1 million ($1.3 million) in 96 seconds, the fastest crowdfunding campaign in history.
In October, the bank announced it was ending one of its most popular features, unlimited free ATM withdrawals abroad. It said it would cap current account customers’ free overseas withdrawals at £200 per month, and apply a 3% charge on any further withdrawals.
“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,” said Chi-Hua Chien, managing partner of Goodwater Capital.