Key Takeaways
- • Monzo is reportedly preparing to approach venture capital investors for a funding round valuing the UK digital bank at around EUR 8.9 billion, according to the Financial Times, citing people familiar with the matter.
- • The move follows the collapse of talks over a EUR 11.9 billion takeover by Brazil-based Nubank, which broke down over disagreements on valuation.
- • A parallel plan to sell a stake of up to 15% to private equity firms Advent International, TPG, and CVC has stalled, with Monzo having sought a valuation of around EUR 9.5 billion.
- • The capital is intended to fund European expansion, following the closure of US operations and launches in Ireland and Spain under current CEO leadership.
Summary
UK-based Monzo is reportedly preparing to approach venture capital investors for a funding round that would value the digital bank at around EUR 8.9 billion, according to the Financial Times, which cited people familiar with the matter. Monzo declined to comment. The move follows the breakdown of discussions over a EUR 11.9 billion takeover by Brazil-based Nubank. Talks ended over disagreements on valuation. An acquisition would have given Nubank, which is US-listed and has a market capitalisation of approximately EUR 49 billion, a presence in the UK. Nubank is now expected to concentrate on its expansion into the US market.
Monzo had kept a minority stake sale to private equity as a fallback during the Nubank negotiations. Buyout firms including Advent International, TPG, and CVC held discussions about acquiring a stake of up to 15%, with Monzo seeking a valuation of around EUR 9.5 billion. Those talks have since stalled, according to the same sources, prompting the shift toward venture capital. The Financial Times reported that a traditional funding round marks a departure from the board's preferred approach, as a person familiar with the board's thinking had previously indicated that either a takeover or a private equity stake sale was favoured over a new round, partly because a private equity deal would have delivered a considerably larger investment. Advent International, TPG, and CVC did not immediately respond to requests for comment.
The capital is intended to support Monzo's expansion in Europe. Under its current chief executive, the bank has closed its US operations and launched in Ireland and, more recently, Spain. That leadership change followed a period of shareholder tension in 2025, when investors including venture capital firms Accel and Iconiq pushed back after the unexpected departure of the previous chief executive. Shareholders called for the removal of Monzo's chair and greater investor representation on the board, while the former chief executive returned as a non-executive director.
To diversify its revenue, the bank is expanding its lending portfolio and adding features such as mobile phone eSIMs. The outcome of the fundraising will indicate how much capital Monzo can secure for its European growth plans following the collapse of its earlier deal talks.
Monzo had kept a minority stake sale to private equity as a fallback during the Nubank negotiations. Buyout firms including Advent International, TPG, and CVC held discussions about acquiring a stake of up to 15%, with Monzo seeking a valuation of around EUR 9.5 billion. Those talks have since stalled, according to the same sources, prompting the shift toward venture capital. The Financial Times reported that a traditional funding round marks a departure from the board's preferred approach, as a person familiar with the board's thinking had previously indicated that either a takeover or a private equity stake sale was favoured over a new round, partly because a private equity deal would have delivered a considerably larger investment. Advent International, TPG, and CVC did not immediately respond to requests for comment.
The capital is intended to support Monzo's expansion in Europe. Under its current chief executive, the bank has closed its US operations and launched in Ireland and, more recently, Spain. That leadership change followed a period of shareholder tension in 2025, when investors including venture capital firms Accel and Iconiq pushed back after the unexpected departure of the previous chief executive. Shareholders called for the removal of Monzo's chair and greater investor representation on the board, while the former chief executive returned as a non-executive director.
To diversify its revenue, the bank is expanding its lending portfolio and adding features such as mobile phone eSIMs. The outcome of the fundraising will indicate how much capital Monzo can secure for its European growth plans following the collapse of its earlier deal talks.
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