- Monzo is seeking a £7.5 billion raise after talks with private equity firms collapsed.
- Nubank’s £10 billion takeover offer has fallen through over a dispute over value, and the £8 billion buyout talks have also been called off.
- If Monzo is worth £7. 5 billion, that’s about 86 times its statutory pre-tax profit.
Back in 2015, Monzo raised £1 million in 96 seconds. Since late September, it has been gauging investor interest in a bank with over 16m customers, despite lower valuations.
The Financial Times reported that Monzo is planning a £7.5 billion funding round after running out of options following the failed £10 billion takeover bid from Nubank and stalled talks with buyout firms.
Three options, each with a lower price tag
Sky News reported on 26th September that Nubank was in early talks to acquire Monzo for £8-10 billion in cash and shares. Tech Funding News also reported on this on 28th September. Nubank said on 30th September it was not proceeding with the deal. The FT reported that the deal collapsed over a disagreement on value.
Following that, Monzo spoke to the buyout firms. Advent, TPG and CVC were all looking at taking up to a 15% stake, with Monzo targeting an £8 billion valuation. A source to the FT said the board favoured a buyout or a PE deal over a fresh funding round, as that would have raised the most money. Initially, a London listing led by Morgan Stanley was the plan.
The valuations are not directly comparable, as a takeover would value the whole company, whereas a minority round would value only part of it. That said, £7.5 billion is £500 million less than what Monzo asked buyout firms for and roughly 67% higher than the £4.5 billion valuation from the employee share sale in October 2024.
What new investors will pay
Monzo reported £1.7 billion revenue for the year ended March 2026, up 39% and a statutory pre-tax profit of £87.3 million, up from £60.5 million, according to Bloomberg. At a £7.5 billion valuation, Monzo would be worth circa 86x statutory profit and 43x adjusted profit, according to our calculations.
Revolut is the benchmark. The fintech sold shares at a $115 billion valuation, at 50x its 2025 pre-tax profit of $2.3 billion. It has 80 million customers versus Monzo’s 16m. At today’s exchange rates, £7.5 billion is about $ 10 billion, which is less than 1/10th of Revolut’s value.
Monzo is seeking funding to help it grow in Europe. They opened in Ireland in April, shut down its US business that same month, and launched in Spain in October. The company has over 5,000 staff.
Fortune Business Insights estimates the neobanking market at $310 billion in 2026 and $7.66 trillion by 2034, growing at 49.3% per annum. Investors will look at Monzo’s growth prospects rather than the sector as a whole.
Accel, Iconiq, CapitalG and GIC in Singapore now have to decide whether to invest at a valuation the buyout firms effectively rejected at £8 billion, and at what price. If they do, £7.5 billion will be the benchmark for UK neobank fundraising. If they don’t, then the Monzo board will be left to see that the market valuations are lower than they’d hoped.
