It does not matter for FX risks. Any IPO in the US will be done at higher valuation ( more than 30%) than in UK, especially for fintech companies.
I’m in a very similar position and have the same questions about potential tax implications - Has anyone spoken to an advisor about this and can recommend/introduce someone?
One of the IPO strategies I’m considering is to sell a portion of my shares and hold on to the rest for the long run as I do believe they’re able to rival the likes of HSBC one day. If they achieve the same market reach, they will do so at a much bigger margin due to having a good tech stack and not the fat layer of middle management and inefficiencies etc (speaking as an ex-HSBC employee…). HSBC market cap is roughly $150bn… so you have to think… that is around 40x larger than Monzo currently… if i sold all my shares at IPO and it went on to those dizzying heights i’d feel sick to my stomach! Obviously they have things like Investment Banking arms etc, but they make most of their money in Retail & Commercial Banking.
I think it ultimately depends on a couple of factors which will be unique to everyone… 1) Do you believe in the long-term potential of Monzo & 2) Will you need the money for something?
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Only another 158 years to wait then (since HSBC started trading) … 
…no, sorry, Monzo is already 8 years old , so 150 years
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I can’t believe people are trying to compare Monzo to HSBC in terms of potential market size. It’s beliefs like that which cause over inflation in value and subsequent crash at IPO.
This isn’t to discredit Monzo and it’s potential success, but I think a sense of reality is needed here.
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This 
Is everybody overlooking the fact that Google is buying a stake in Monzo? IPO might never happen, big tech is coming…
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Just to be clear, I’m talking about a very long time-horizon… 10-15 years or so. The debate is whether to sell at IPO or to hang on for the ultra long term. They can absolutely take on the likes of HSBC in the long-run. I worked in their Commercial Banking strategy team and don’t believe there’s anything Monzo couldn’t replicate and do better. It would take a long time to replicate their geographic reach, but their margins will be huge compared to HSBC.
But by the time they IPO…you’re right… absolutely not!
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You’re right… IPO may never come at all!
My only concern is that Monzo are doing this to raise money, not to make us long time loyal ambassadors who have kept the faith for almost 8 years, richer.
They want cash - I get that Google want to own a piece of the Monzo pie, and therefore buying us all out would give them a bigger slice (fewer new shares needing to be issued) but this does not put money into the Monzo coffer.
So, I’m not expecting to see any return on my investment from this deal.
They have international ambitions. To grow that way fast it has to be non-organic. You’ll see a return if it succeeds.
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I’m a capitalist. I couldn’t care less.
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I’m a round 1 shareholder too and maxed each round.
But some sense of realism is needed here. Google is not buying any part of Monzo. Google Ventures is a corporate-owned venture capital firm, that’s all. Look at their track record. None of their portfolio companies have ever been meaningfully incorporated into their core businesses. Lemonade Insurance is a decent case study here and there are lots of similarities with Monzo’s history/approach. This is purely an investment, with plays being called by a handful of people at Google Ventures - that is all.
Also agree that comparisons to HSBC aren’t worth making. Absolutely see where you’re coming from but if we’re going to be mega bullish then Lloyds is a much better comparison. They are 6x smaller than HSBC at c.£25bn.
Honestly, if an IPO is in another 2 years I’d expect a valuation in the £5bn range. If that happens, my ideal strategy would be to sell a third at IPO, another third if it gets to a £10-15bn range and then hold the last third for the long term in case I’m being too negative!!
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It’s going to IPO at greater than £5bn valuation, I’m more bullish and expect it to be between £8bn to £10bn. By then, revenue and profits would’ve increased as well US customers numbers and also hoping IPO valuations would’ve improved.
My guess is IPO valuation is going to be driven by the Investment Banks then in the first week there will be a pop, after which the valuation will decrease to a more normalised level which is what usually happens with most IPOs.
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I plan to sell at least to recoup my original investment and then wait for a drop before re-purchasing for my ISA.
In a similar position, maxed first 2 rounds. Regarding tax plan, at IPO I’ll transfer the shares to a stocks & shares ISA where I’ve got other investments. That’s not classed as cashing out. I do need to check what the tax implications are at that point, then sell just enough to balance the risk in my folio so there’s not too much in Monzo, trading it for something lower risk. Then I’ll just draw down on what I want from the folio when I need it, pay capital gains tax on it and declare that on my self assessment. Would love to transfer them directly into my SIPP but not sure what the tax implications are there.
Generally though I think I’m going to play the very long game with Monzo, they have a great culture, outlook, leadership and product. Don’t see why they won’t x80 my initial investment over a 25 year period.
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Are you not confusing a “Save as you Earn” or “Share incentive Plan” which as far as I am aware is transferable CGT free to £20k limit
with transferring Monzo shares into an ISA "bed and ISA " which you have to sell before repurchasing to put into an ISA , not sure its a simple transfer - you have to realise the gain first before repurchasing them in the ISA ???
Correct, the shares sold would still be subject to CGT even if they are immediately transferred into a shares ISA.
Only advantage of doing this is protection against long term gains.
I’d rather sell all once the price pops after IPO, then usually once the hype is over the price does drop below IPO which at that point I would purchase a smaller amount and leave it in the Shares ISA for the long term.
I haven’t done it before but I believe I would be transferring the broker as ‘in-kind’ via ACATS, which isn’t classed as disposal or encashment. I’ll double check with my broker though.
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Please do check and let me know.
From what I understand shares at IPO are not transferable directly into a Shares ISA ie a standard shares brokerage/trading account.
Unfortunately I don’t think that strategy will work as you can only make cash contributions to your ISA. I think the same rules apply to SIPPs.
d. Premium Bonds
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