The Monzo of old is dead (?)

Some background. I’m user #134404, joined in March 2017. I’m an investor. I joined Monzo because it seemed to me as if they were rewriting the rules of banking. When they got a bank license and opened current accounts I was straight into moving from my old bank. Loads of great features and amazing support, but most of all a desire to listen to and work with customers. I remember the community poll on how to handle overseas charges, they genuinely listened to users to make the best decision for the majority. When business accounts came I was keen to move. Ultimately our main business is too big for Monzo, they’re focussed on sole traders or partnerships mainly, OK fair enough.

But sometime around the cashflow issues, Tom going and the updated strategy to focus on profit by pushing plus, flex and other paid products, the old Monzo died.

Now it’s just another mobile bank. Customer service and the users are a lower priority, making profit is the priority. I get that they need to be profitable but the core values didn’t need to change as drastically as they have.

It’s a shame as in the beginning it felt like Monzo was on our side. We were doing this together. We shared the vision for how banking could be better. That’s all gone. There’s no interest in users other than how they impact the bottom line.

No blame on the team, I’m sure that they’re working hard and they’re nice people. What I see is a values change and I suspect that a chunk of the old team left when the values did.

It’s a shame. Starling is still fighting for the little guy but they’ve never had the same energy that Monzo had in my opinion.

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It’s a bank with 7 million customers now. That they no longer make decisions based on the 40 of us or so who regularly use the forum shouldn’t be a massive surprise.

You are one of 7 million customers. They still make design and product decisions around customers, just with a broader and more established approach, and you’ll feel less connected to them because of the numbers

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This feels like a personal blog entry kvetching about something you can’t change. Not sure what you wanted to get out of posting it.

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By definition of evolution, this will, and should, happen. Regardless of the happy-days nostalgia (of which I also share), ongoing success for Monzo is what we want.

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User #2114 here, also investor, can we have a competition, somebody must be lower!

I agree the old Mondo ethos is dead. That’s not necessarily all bad, it was pretty fast and loose at the time, and they’ve had to grow up a little as they grow, that’s normal and to be expected.

Things I feel like they’ve really got lost on somewhere along the way though:

  • Customer-centred ethos
  • Customer support - this is pretty patchy at present IMO - slow responses or no responses is now the norm
  • Coherent design - it doesn’t feel like they have a strong drive towards a common goal anymore in the app - too many disparate teams working on individual features, and no overall coherent plan - see the new home screen drafts for example.

Things they’ve done really well recently:

  • The product continues to improve, features like trends evolving or virtual cards
  • The launch of plus went tolerably well and seems to have given them some revenue (though still not sure how important this will be to them compared to card use, savings etc)
  • They’re still working on new features like Investments, this gives me hope for the future

Covid and the rise in the cost of money and subsequent drying up of investment rounds was really bad timing for them, and a real shame, I hope they get over that hump and end up with a profitable business which can continue to grow, as they’re still getting a lot of stuff right, and I still prefer them after all these years to other banks I’ve tried.

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Tis the season for “Monzo has changed, is dead, has stagnated etc” topics that’s for sure :sweat_smile:

Hopefully some kind person can merge them all into one. @AlanDoe ?

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Isn’t it always that season around here? :smiley:

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TL;DR

I think it’s the right thing for Monzo to do, you can’t be a small scale startup forever and it’s not realistic to do what you do as a startup when you have +xxxx customers.

The longer version

Really interesting post. I think the post really highlights how startups move towards a sustainable path and some of the challenges they might face in staying relevant.

It’s a difficult one for any company is growth isn’t it. Do they keep small and focus on small scale significant disruption or do they identify their offering isn’t distinct enough therefore scaling becomes the only option to profit.

For Monzling it was inevitable that other banks would catch up. And that other startups would appear and disrupt on their own.

I think we have three types of bank now:

  • Legacy (NatWest, Barclays)
  • Fintech Legacy (Monzo, Starling, Chase?)
  • New fintech (Algbra, Tred, Kroo)

The challenge for the latter is going to be being significantly different to attract VC investment and continued support while they grow/be acquired by a larger fish.

The challenge for the second is a double sword.

On one hand you are trying to attract and retain customers From legacy banks. That’s harder since I suspect a lot of people really don’t care what the app does. They just want their bank to work and be assured that the customer service will do what they need it to do.

Secondly you’re trying to prevent erosion from new and existing banks which might offer cashback or switch incentives.

So what else can they do? They have to grow organically and through marketing and as they do, they need to change process to work for a larger significantly more complex organisation.

Which is a really long way of saying Monzo
Isn’t the bank it was in 2016 and shouldn’t try to be. It’s not different enough to survive with ever decreasing VC interest and low numbers.

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Is there a template somewhere for these threads??

Clickbait title
Mention you’re an investor
Errors galore

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This one always gets me. Let’s be honest I chucked in £10 and got to be an “investor”.

Do I ever expect to see a return. No. Do I expect Monzo to do my every whim, give me special treatment, also no.

If I had actually invested, such as like £500k or
a £1m then maybe some special detail on when I could expect a return. Which is what I think actual investors probably get.

I don’t mean to offend anyone but let’s be honest. There is a difference between being an investor and being a VC company

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Oh dear, I always have to smile when the I’m user # whatever gets mentioned, it’s not a badge of honour, it means nothing.

Monzo was always going to evolve, that means going away from what they once did. They must be doing something right as they’ve got plenty customers.

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Always sensible to expect a loss on any startup shares, but I think it extremely likely you will see a return at this point sometime?

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Well, yes, perhaps one day Monzo will float and I’ll get my £10 back plus some small profit.

My point is, being a crowdfunder investor and being a venture capitalist are two very different things.

You should, in my opinion, always expect to get little to nothing back in a crowdfunding round, because even if Monzo floated there will almost certainly be bigger fish to return roi/dividends to.

But people come on here all the time and band the “as an investor I think Monzo should do more” when they (probably) put as little as I did in yet somehow think TS Anil should act.

It’s not the badge of entitlement that some users on here think it is.

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Generally I agree, but dividends have nothing to do with a return on your shares. It only depends on the share price difference between when you bought and when you sell (dividends, if they ever become a thing at Monzo, are paid out from profits split equally between current shareholders).

But you are right you should expect nothing back because most crowdfunding things don’t make a return. And yeah it doesn’t give you any greater say in the business nor should it - just because you’ve spent £10 doesn’t mean your opinions are more worth listening to!

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Correct I’ve updated the original post to reflect.

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Interesting responses thank you.

In feeling the need to defend myself (or offer extra info).

I hadn’t intended to be bragging about my status (of which I have none!), just giving some background that I really cared about Monzo in the early days. I was so passionate about it.

In terms of whether this change is part of the natural course from startup to corporate, I’m not sure. Maybe it is and I’m naïve, but my personal opinion is that values don’t have to change as a company grows. The value of customers come first was core to early Monzo in my opinion, as was doing something for the benefit of customers. I think there was an ethos of rooting for the little guy and I think that can scale with growth. I accept that the method with which that will be implemented will change - there may not be the same type of forum post polls etc but I sense the values have changed, which is somewhat expected when the senior leadership change to go in a different direction based on market pressures.

My point of sharing was just to say that it’s a shame, but I guess change is constant and we can’t control it.

Nice to have so many thoughtful responses though, thank you.

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Generally speaking,

because if there was a decent chance of money to be made, VC industries would be piling in there already.

This is what a lot of people don’t understand about crowdfunding. It’s inherently risky and you should be prepared to lose everything you put in. I’m not saying this books true for Monzo, but in the majority of cases, businesses are turning to the crowd not out of altruism but because they’re struggling to raise money in other ways.

This means that it’s often closer to betting than it is to making a considered investment with the expectation of a return. You can have a good product like Sugru, but if your structure isn’t right you’ll lose everyone money. Or you can have a an offering which is closer to joining a fan club, like Brewdog, where you’re essentially paying for some perks rather than having a real hope of a big return. Or you could have a fantastic product (millions of food brands) but if you’re dropped or not picked up by the big supermarkets, that kills any business or return stone dead.

I appear to have digressed somewhat, but you have hit on one of the small hills that I will die on.

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Investor, and user #3843 and I’m glad some of the Monzo of old is dead with the new focus towards profitability, expansion into multiple regions/countries, new features & products being offered.

The Monzo of old was good for foundations of popularising a brand, now we’re on to making a proper bank.

I don’t expect my low user count to mean I have better input that anyone else in the Monzo ecosystem at all.

One thing I will mention, every time I’ve used support I’ve had zero issues. Maybe being sub 5k user number gets me that?! :joy:

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They did well in 2017. I’m #385659 joined in August, so almost trebled their number of users in 5 months.

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I’m user #17896 apparently. I didn’t know you could see this in the app. TIL

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