A notice to our Crowdcube investors 🤗


(Stephen Early) #21

Hmm. I received the explanatory email from Tom, but haven’t received anything from WCS Nominees. Is anyone else still waiting for that email?


(tom) #22

Every shareholder has pre-emption rights, but it’s normal in a funding round for those pre-emption rights to be disapplied. This is done by special resolution, and it requires the approval of at least 75% of shareholders.

Resolution 4
"That, subject to the passing of resolutions 1, 2 and 3, all and any rights of pre-emption whether under the New Articles (in particular article 10.2) or otherwise be and are hereby waived in respect of the allotment and issue of shares in the capital of the Company up to the maximum aggregate nominal amount set out in resolution 2."


Maintain our participation ( resist dilution )
:newspaper: Monzo, a UK digital-only bank, is closing in on new funding - TechCrunch
(Ben Green) #23

It’s understandable that a little dilution of share amount can happen in the initial stages, but once Monzo is able to stand on it’s own two feet without requiring any further fundraising after launching the full bank, it’ll quite quickly grow organically. Therefore the value of each share will be much much higher than it is now and you would then still be able get your return and more.

Monzo hopes to reach, or even exceed, its aspirations of 1 billion account holders worldwide and will remove the limit of a total £50,000 balance. It might grow at steady rate or maybe exponentially - the skys the limit. Nobody knows at this point what might happen though.


(Fin) #24

That’s kind of irrelevant I’m afraid. A “a little dilution is understandable” attitude isn’t a justifiable reason to dilute current shareholders in favour of new ones (unless you’re a new one…).


(Alex) #25

Thanks for the quick and informative reply Tom!

That seems like a very sensible clause and will provide the required flexibility now and protection in the future.

Onwards and upwards!


(Ben Green) #26

Hmm, that just sounds greedy to me. It’s the beginning of one of the same problems afflicting the big banks - shareholder greed.


(Alex Sherwood) #27

Business Insider just published a story about this fundraising

App-only bank Monzo valued at £50 million in ‘interim’ £4.8 million funding round


(Fin) #28

Remind me why you want to invest?


(Ben Green) #30

As a future source of income, but not at the detriment of preventing others from investing. Otherwise I’d be contributing the same state within Monzo investors that our country is in. The rich get richer while the poor get poorer, or at least find it more difficult to get a foothold.

That too, thanks @-removed-. We’re already a part as alpha or beta users, but to be an investor would also allow me to say to friends and family that I had a financial stake in the building the best bank on the planet. Something to be proud of.

If we all do well, rather than a select chosen few, then Monzo has greater potential do well as a whole and that ultimately benefits everyone - shareholders and general account holders alike :smile:

I’ll leave it there as Tom as already stated not even he knows how the next round of funding will work. Plus I don’t wan’t to start a civil war :disappointed_relieved:


(Brexit Day Is Gonna Be Shamayzing.) #31

I want to buy in


(Fin) #32

That’s not contradictory at all.

To be clear, I’ve never advocated allowing current investors to invest at the detriment of new investors, simply that those who supported the company in its early stages should be afforded the opportunity to protect their investment from dilution – two very different things. We’ve just been diluted by 10% which isn’t insignificant by the way.

I’m also not sure this is a debate about rich getting richer, poor getting poorer. If stereotypes are anything to go by, initial Crowdcube investors are anything but rich. Millennials (Monzo’s target demographic) aren’t exactly rolling in it these days, and given your appetite to invest, I’d assume you don’t fall into the “poor getting poorer” category – but don’t let that get in the way of your argument. Also, “select chosen few”!? Lucky few who set their alarm clocks for 12pm and furiously hit refresh on their browsers would seem more appropriate, but again, probably not biased enough.

For the record, I sincerely hope you, and anyone else that wans to, are able to invest next year.


(Ben Green) #33

Cool, we can agree then :thumbsup: :slight_smile:


#34

as investors we were aware of this possibility when we invested


(Dan) #36

I think you’ve both taken his words out of context here.

He clearly didn’t lack the knowledge and was aware of the possibility - he’s talking about it.

His comments are regarding preemption rights and why existing shareholders should be entitled to them. Without them, they risk their % stake in the company eroding through further funding. It’s not dilatation he has the issue with, it’s @beningreenjam’s argument that investors should just accept the dilution, without the preemptive rights.


(Ben Green) #37

Woah! Lol, I never had a problem with existing investors getting first dibs, as I stated here -

Just to clarify - I appreciate the input from existing investors and support their opportunity to get first pick in the future rounds, but would be against them taking everything before wannabe investors get a chance to buy.


(Dan) #38

Apologies, my words are assumptive.

I should of said:

“it’s @beningreenjam’s argument that investors should just accept the dilution, without the preemptive rights - if there are no shares left after existing shareholders purchase their own.”


(Ben Green) #39

No problem. I think we’re hopefully coming to agreement and it’s all been civil so no apologies necessary.

The first and only round so far reached its target in 96 seconds so a little concern for opportunities of prospective investors is justified. However the next round is expected to be double or even triple that of last time so hopefully won’t be an issue.


((☞゚ヮ゚)☞ ☜(゚ヮ゚☜)) #40

Is it possible for existing card holders to pre-invest using our cards? I really want to invest on the next round as I missed out last time. I’d really like to put aside a certain amount on my card that is authorised for investing in Monzo as soon as I can.


(Christopher J. Sladdin) #41

@tom, glad to hear that you will look to involve both existing investors and those who didn’t manage to invest last time. Unfortunately, I was too slow to invest last time despite having the email open within a few seconds of it arriving. Nevertheless, as someone who has been very active in the community and in suggesting new feature ideas (which I’m delighted have been incorporated), I would love to own a small stake in the bank I’m helping to build. As such, it would be great to see a way that those of us who are active on the community get early access to invest before you release shares to the general public. Seems only fair.


#42

Existing holder here. Not overly impressed with this placing. Here me and @iansilversides were debating whether the 2017 fundraising will be at £100m or higher valuation with all the progress made, and you’ve slipped in a sizeable dilution to insiders without opening it to the market to find the real valuation. It is slightly shocking that you’ve had to suddenly negotiate a ‘bailout’ at what i personally believe to be a low valuation, without time to open it up to other investors. If it had been foreseen you could have added crowdfunding and other investors and easily got a much higher valuation and therefore less dilution.

I don’t think you can say shares are now worth more. The implied valuation is 50% higher, but look at Powa and their implied valuations going up by 50% every time their investor gang topped up until it went pop. You can only really say shares have gone up if they are tradeable and they are trading higher. The only thing you can say for certain is that you have overspent and been forced to heavily dilute.

Not baulking at a ‘higher valuation’ but i really look forward to the day you open your valuation to market perception rather than undervaluing yourselves.