it is the cost of the shares in each individual round of funding - if you bought shares in the original round at 51p those shares would now cost you £1odd - the share ‘value’ is a bit different really - at the moment you probably wouldn’t be able to sell the 51p shares for £1
For the record, Monzo’s articles of association state that you may transfer the shares to a family member or company solely owned by yourself but you may not transfer them to anyone else without extraordinary exception/permission from Monzo.
Unless there is a successful takeover bid (unlikely imho as they have already turned down many and Tom stated selling out would be a sign of failure) you will probably be able to sell the shares in 5 or so years when they plan to IPO.
You can estimate the share price based on the most recent funding round valuation and the progress made since. The most recent raise was at £1.01 a share giving a market cap of £87m post money, but they are growing exponentially so it is tricky to value what it is worth now. In the 4 or 5 months since then they have tripled user numbers from 120k to 360k and massively increased metrics like 7 day active users, demonstrating outperformance of expectations and therefore probably good reason to have a higher valuation. You also have the factor of a higher tide raising all ships and you cannot ignore Revolut’s raise at £300m valuation based on their user growth. By my figures/imo Monzo is likely to hit 1m users before revolut in around Feb 2018 (notwithstanding inorganic growth from Revolut ie. them spending millions on tv adverts across Europe vs monzo running solely on word of mouth in U.K.), or if they don’t hit 1m first then they are likely to overtake soon after, as their rate of growth is currently much higher. Therefore is it outrageous to suggest monzo might be worth more than £300m if they overtake?
This makes me highly optimistic that when monzo raises next year (spring 2018 I have heard banded around although cannot find a source) it will be somewhere between £250-500m valuation which would be around £2.85-5.75 a share. This is just speculation on my part but without a market the only way to gauge a value is to speculate. I’m sure there will be others with different ideas about the valuation and would be very keen to hear them! Good luck
I think the best comparison would be with UK retail banks. The problem is that most of them still have significant investment activities, overseas operations and provide business banking. As such, it is hard to distinguish what an expected value per UK retail customer would be.
There are other conflicting aspects to the potential valuation. You could argue Monzo’s customer base is more affluent and therefore valuable than the average UK bank and they can be sold more services. Also, their cost base should be significantly lower as they don’t have a high street presence and doubtless save a small fortune on rent or rates vs a traditional bank. On the flipside, their customers are probably more financially aware and more inclined to switch to get good deals which would make than worth less than other banks.
Im not sure about the like with like comparison with “retail banks” , I don’t think Monzo want to be a ‘bank’ its just a stepping stone to bigger things - I really do believe this is Monzo teams view of their business going forward - I know its a stretch of the imagination, but its similar to Facebook - boo hiss Facebook etc etc connecting friends at Uni is where Monzo is at right now.
The valuation for me is still a bit irrelevant , yes its nice to think that other , perhaps more knowledgable investors are willing to put in lets say 100m next time for a dilution of c.25% which would ‘value’ Monzo at £400m , - figures not beyond belief, but at the moment its still in its infancy - it could fail, it could be something substantially bigger in 5 years time - hopefully speaking as an investor the later
I made a pledge back in the March session of investing but unfortunately I got the email saying I was unsuccessful
Not sure whether the sum I pledged wasn’t high enough to be considered or whatever, it would be nice to let as many people as possible join in and help Monzo become bigger and better.
Hopefully we have better luck in the next round buddy. I don’t think it should be a lottery though. Investors are getting preferential treatment for the CA and I think everyone who wants to pledge to invest should be allowed to do so.
Monzo has captured the imagination of many people wanting a better current account / banking experience such that people wish to invest. Monzo was oversubscribed.
What is the fairest way of allowing investment when oversubscribed? A random selection seems fair to me. Nobody is given preferential treatment though some are luckier than others.
I’m incredibly enthusiastic about Monzo having acquired my present ‘Mondo’ pre-pay card in June 2016. I’ve been recommending them to loads of people, too
I’d love to test their current account and feedback information to help them build a better product. Alas, they didn’t select me …so I’ve set up a Starling account this week. I’d much rather have a Monzo current account, though.
Monzo was quite clear that investors would be given priority access to the current account. I’m disappointed I wasn’t selected for the investment but they were transparent about this.