Key Takeaways
- • Monzo is exploring a fresh fundraising round that would value the London-based digital bank at roughly £7.5bn, according to people familiar with the discussions cited by the Financial Times.
- • Private equity talks over a minority stake of up to 15 per cent have stalled; buyout firms Advent International, TPG and CVC had been in talks with Monzo, which sought an £8bn valuation.
- • Monzo's pursuit of a £10bn takeover by Brazilian fintech Nubank broke down over valuation, leaving the bank pivoting to venture capital investors for a more traditional round.
- • Monzo reported £87.3mn in pre-tax profit for the fiscal year to March 2026, up from £60.5mn, with revenues rising 39 per cent to £1.7bn.
- • The bank, last valued at £4.5bn in a 2024 employee share sale, launched in Spain last month and is seeking cash to fund its European expansion.
Summary
Monzo Bank is exploring a fresh fundraising round that would value the lender at roughly £7.5bn, according to the Financial Times, after failing to complete a £10bn takeover by Brazilian fintech Nubank and struggling to sell a minority stake to private equity. Talks with private equity groups have stalled, according to people familiar with the discussions. Buyout firms including Advent International, TPG and CVC had held talks over a potential stake of up to 15 per cent, with Monzo seeking an £8bn valuation.
Monzo had treated private equity as a backup to the Nubank talks. After the takeover discussions broke down over valuation, the bank focused on private equity, but those talks have now stalled. The FT reports that the board had previously preferred either a takeover or a private equity stake sale over a new funding round, since a private equity deal would have brought a much larger investment than a venture capital round. Monzo is now preparing to approach venture capital investors for a more traditional round. Dealroom reported the same story with a $10bn valuation target in a venture round. Nubank, which has a $55bn market capitalisation, would have gained a UK foothold through an acquisition, but is now expected to focus on expanding in the US.
The fundraising comes as Monzo, founded by Tom Blomfield in 2015 and employing more than 5,000 people, seeks capital for European expansion after launching in Spain last month. Monzo last raised at a £4.5bn valuation in a 2024 employee share sale. The company has more than 16mn customers, almost all in the UK, and trails domestic rival Revolut, which has 80mn customers across more than 40 countries. Its financials improved for the fiscal year to March 2026, with pre-tax profit of £87.3mn, up from £60.5mn, and revenue up 39 per cent to £1.7bn.
Governance has been a recent concern. Last year, major investors including venture capital firms Accel and Iconiq pushed back after chief executive TS Anil departed unexpectedly, leading to demands for the chair's removal and greater investor board representation. Anil was reinstated as a non-executive director. His successor, Diana Layfield, closed Monzo's US operations to focus on Europe, launching in Ireland and Spain, and is diversifying revenue through lending and new features including eSIM mobile services. Monzo declined to comment, and Advent International, TPG and CVC did not immediately respond to requests for comment.
Monzo had treated private equity as a backup to the Nubank talks. After the takeover discussions broke down over valuation, the bank focused on private equity, but those talks have now stalled. The FT reports that the board had previously preferred either a takeover or a private equity stake sale over a new funding round, since a private equity deal would have brought a much larger investment than a venture capital round. Monzo is now preparing to approach venture capital investors for a more traditional round. Dealroom reported the same story with a $10bn valuation target in a venture round. Nubank, which has a $55bn market capitalisation, would have gained a UK foothold through an acquisition, but is now expected to focus on expanding in the US.
The fundraising comes as Monzo, founded by Tom Blomfield in 2015 and employing more than 5,000 people, seeks capital for European expansion after launching in Spain last month. Monzo last raised at a £4.5bn valuation in a 2024 employee share sale. The company has more than 16mn customers, almost all in the UK, and trails domestic rival Revolut, which has 80mn customers across more than 40 countries. Its financials improved for the fiscal year to March 2026, with pre-tax profit of £87.3mn, up from £60.5mn, and revenue up 39 per cent to £1.7bn.
Governance has been a recent concern. Last year, major investors including venture capital firms Accel and Iconiq pushed back after chief executive TS Anil departed unexpectedly, leading to demands for the chair's removal and greater investor board representation. Anil was reinstated as a non-executive director. His successor, Diana Layfield, closed Monzo's US operations to focus on Europe, launching in Ireland and Spain, and is diversifying revenue through lending and new features including eSIM mobile services. Monzo declined to comment, and Advent International, TPG and CVC did not immediately respond to requests for comment.
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