Monzo boss aims to grow bank ‘several times’ bigger ahead of expected listing
The chief executive of Monzo has said it is still “too early” to talk about the digital bank’s IPO ambitions as he focuses on growing the business “several times” bigger and expanding overseas.
TS Anil, who has headed up the challenger bank since May 2020, told City PM that he prioritised growing Monzo’s market share in UK banking and expanding in the US and Europe.
“It’s too early for us to talk about the IPO,” he said. “We’re incredibly well capitalised. We don’t need to raise capital. We’re focused really on continuing to scale the business.”
Monzo, which expects to hit 11m customers in 2024, is one of the UK’s most valuable tech start-ups, notching $610m (£490m) in funding this year alone to bring its valuation to $5.2bn (£4.1bn).
“In terms of how we will invest the money, our strategy is focused on making sure that we win the UK at scale,” Anil said, adding that he wanted the bank to have “millions of more customers here, many, many more products and the size of our business being several times the size that it is today”.
“So, the UK across personal and business banking is the first and most important port of call for us, and then international expansion,” he continued.
Anil’s comments came after Monzo posted its first annual profit of £15.4m since launching in 2015, also unveiling plans to enter continental Europe. Monzo’s revenue increased two-and-a-half times in the last financial year to £880m, while its assets nearly doubled to £13bn.
Its growth has fuelled hype over a potential London IPO, with Anil joining a “Unicorn Council” formed by fintech trade body Innovate Finance in March that is partly focused on making the UK a more attractive listing venue. Monzo’s tech-heavy focus and US presence has also raised the prospect of a New York listing.
Anil has repeatedly said he thinks Monzo will make a “great public company one day” but has given few hints on the timing or location of a potential IPO.
Still, on Monday he said it was “heartening to hear positive signs of the markets opening up” as bankers eye a rebound for London IPOs after a torrid 2023.
“We’re a learning company. We’re paying attention, we’re listening and we’re learning as the landscape continues to evolve,” Anil added.
With fintech valuations still broadly struggling since a peak in 2021, analysts predict increased consolidation is more likely than a wave of IPOs in the near term.
“Some consolidation is inevitable in any industry,” Anil said on Monday, noting trends across both fintech and traditional banking, including Nationwide’s recent £2.9bn deal to acquire Virgin Money.
“The good news is that we’re positioned to benefit from that – being well capitalised as we are and the ability to be an acquirer and consolidator, and not a consolidatee.”