Perhaps some of the new development has been harder to spot (theyâve been working a lot on their premium option, for example) but the pace of their developmentâs actually been one of the things thatâs impressed me most about them. You can get a sense of how quickly theyâre launching new features and functionality from their twitter feed.
A number of things stood out at their pitch.
1: Number of users is around 200K (not sure how many active).
2: Their value is in the anonymised data they get, worth a lot in the right hands.
3: I like their approach to user acquisition (free shares all round).
4: I just see them being acquired by someone bigger. They have good developers and a big old bank would benefit from that sort of talent.
Ahh I donât have Twitter but have been peering at their blog now and again.
Theyâre quick to fix any issues but from my perspective there hasnât been much improvement in feature set for mobile.
I would still highly recommend MD!
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You also have to think how sustainable their lead is.
They were found pre-PSD2 (aka Open Banking), and their strength was that they created many connections (e.g. APIs or screenscraping) themselves, which took the pain out of linking everything together manually yourself (I.e. the job-to-be-done).
Now, granted that most bank APIs arenât brilliant (many follow the letter of the law rather than the spirit), it is so much easier to build a platform like MD, especially with platforms like OpenWrks, TruLayer or SaltEdge in the middle.
The only sustainable advantage that MD has, as far as I can see, is anonymised historical data and brand recognition.
I had MD account before moving to Emma.
They still have more features compared to anyone.
I closed my account because they are not using open banking api.
Web version is available thats good.
In the period I had account they didnât try to monetize.
And I donât think having historic data is advantage, the data they have becomes stale pretty fast.
If someone interested can listen to pod
Ash Fontana â Investing in Artificial Intelligence. Episode: http://traffic.libsyn.com/investlikethebest/EP.90_-_Ash_Fontana_FINAL.mp3. Media: https://traffic.libsyn.com/secure/investlikethebest/EP.90_-_Ash_Fontana_FINAL.mp3?dest-id=410583. Sent from Podcast Republic.
this about AI and machine learning.
They are now overfunded but have had one single contribution of £1,000,000⌠Crowdfunding as marketing in action!
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I found them interesting as atleast (as compare to other fintec Iâve invested e.g Chip, FT).they are generating decent revenue in the region of $1M so with modest valuation , I found it very attracting proposalâŚ
You would think if someoneâs going to cover the whole of the crowdfunding themselves then they would contact the team privately to arrange a deal.
How do you see the size of contributions?
You would thinkâŚit rings alarm bells for me. On the crowdfunding page you can scroll down and find the below where it details the largest investment
Someone asked the company about the ÂŁ1M investment in the discussion section. Money Dashboard replied
âThe ÂŁ1m investment is from Calculus Capital, an award-winning EIS fund based in London. As you may be aware, Calculus Capital have invested in Money Dashboard before and, like us, are buoyed by the companyâs prospects and have elected to invest again.â
Thatâs all great but sort of defeats the object of âcrowdfundingâ 
Feels like an underhanded way of immediately pushing to over-funding and so creating an illusion of investment interest. Anyway Iâm no expert and am not interested in the company anyway 
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Money Dashboard
So I thought iâd do a stock take on the crowdfunding round. I tried to gear it towards people who may be new to crowdfunding and moneydashboard (MDB) 
Itâs also an attempt at a TL;DR for those who cba to go through this entire thread 
Iâve no affiliation with the company beyond a pending investment - I have tried to offer a balanced take on their campaign. Iâve No affiliation with MDB beyond a pending investment. So, hereâs my take:
The company
Background
Background
Moneydashboard (MDB) is an Edinburgh-based financial management app founded in 2009, borne out of the open banking revolution. MDB is a financial accounts aggregator whose mission is to disrupt the currently fragmented fintech consumer experience. MDB use the resultant data to power savings for its users - active users are claimed to save ÂŁ205 yearly in discretionary spend. To date, they have signed up over 200k people in the UK, connecting 1.2 million financial accounts.
Team
TeamTeams make or break companies. Grit, talent and industry experience are of utmost importance in founders in my opinion. Iâd follow with experience scaling a startup, which has clear relevance.
Steve Tigar is CEO at MDB, and he ticks many of these boxes. Most prominently, he was managing director at âLettingwebâ for 3 years where he grew revenues and re-established the company as leading in its sector. Elsewhere, the team has Revolutâs ex-CFO and the talent involved in Tesco Clubcards data monetising strategy on the board. Not too shabby.
The product
The productTheir user base seems to find the app decent but underwhelming, the app has a âgreatâ rating on trustpilot and a middling 3.5 stars on the app store. MDB plans to iterate the app, however few truly innovative features appear to be on their roadmap â âtribesâ, an exclusive discount initiative, is their most anticipated upcoming feature.
Pros:
The app is free to use, has a simple, intuitive UI andboasts the broadest compatibility in the UK market (access to 60 financial institutions) at present timeCons:
They have no 2 factor authentication and their data monetisation strategy make the company fairly hard to trust with your financial data, trust being the key sentimental obstacle for potential users. Whatâs more, they are feature lacking and are losing out to rivals in terms of product innovation.
Accomplishments and Roadmap
Accomplishments and roadmapThey have:
- Doubled revenue since 2017
- Received funding from notable firms, including calculus capital â demonstrating a strong position to raise capital as needed
- Secured FCA open banking license
- Partnered with Monzo, starling, and pensionBee
They will:
- Invest in digital marketing to drive user acquisition on top of their innovative referral scheme â offering (quasi)shares in the company.
- Introduce âTribesâ, an exclusive discount initiative to add to their product offering
Challenges ahead
Scaling:
MDB have established a product/market fit, so this removes the question of a market need. This a large risk in early stage company investment, especially here, as thereâs much uncertainty in whether the public will deem open banking technology useful and secure enough to adopt. Now itâs a question of how theyâll get from 200k users to 1m. They have innovated with customer acquisition, offering member shares to attract 17,000 customers. Equity crowdfunding itself creates ambassadors, bolstering user engagement. Despite this, only 80k users are active (definition of active unknown).
Business model:
** MDB is monetising their anonymised data on their users. They have generated ÂŁ1m so far from this revenue stream, the bulk of which is from asset managers (e.g. instituitional investors leveraging the data to seek value opportunities) and will be diversified to other clients later in the businessâ lifecycle. MDBâs data is appreciably valuable and high quality, however this is a risky business model, risking poor appetite for the data, moral hazard as it relates to data abuse, etc. A freemium model is a proven,less risky approach in my opinion, as Emma finance has done.
Competition:There is a fair amount of competition in this space. Itâs worth noting that âsavings appsâ such as Plum and Chip are not in direct competition, as Moneydashboard operates more as an aggregator. Youâd think the challenger banks were well positioned to be potential threats, however MDBâs integration with monzo and starling suggests theyâve adopted a partnership mentality. Presumably because of the regulatory barriers to entry, US platforms have not yet entered the UK market. Key rivals at present include Yolt and Emma. I view Emma finance as MDBâs main competitor; their app offers an impressive user experience in comparison to MDB. The formerâs drive to a feature rich, gamified, engaging user interface poses high risk of outcompeting MDB. Furthermore a refusal to share data to 3rd parties, opting instead to charge users for premium features to negate the need to monetise user data is a novel approach to gaining user trust whilst establishing a sustainable business.
The investment
EIS Relief
EIS Relief
For those that donât know, EIS relief is literally the most generous investment tax incentive going - pensions still win in a situation where youâve made a ROI, however in almost any situation where you lose money, EIS takes the crown. The campaign has EIS relief for shares issued up to the ~ÂŁ5m mark, so thereâs plenty to go around. Simply put, EIS relief means 30% of what you invest back and CGT exemption whatever happens. On top of that, if the company fails, you got 28% more of youâre initial investment back â thatâs if youâre a higher rate taxpayer.
Terms (incl. fees)
Terms (incl. fees):The shares issued are ordinary shares. The Vcs whoâve invested in MDB will undoubtedly hold preference shares. Ordinary shares are subordinate to these shares, so the crowd gets its money back only after the VC does.The shares are held in crowdcubeâs nominee structure. This structure makes MDBs cap table nice and slick, which appeals to investors further down the line, especially VC firms. On the other hand, it can have some nasty drawbacks; many express concern for their holdings in the possible event of the platform, Crowdcube, going bust. The consequences of this I canât answer, but iâm looking into it. This inevitably adds to the risk. The fees (1.5% initial fee) are very reasonable given the â2 and 20â fees commonplace in venture capital (2% annual fee, 20% of profits), or even by crowdfunding standards (Seedrs charge 7.5% of profits).
Shares are ordinary shares. Preference shares are, well, preferable â but given that ordinary shares are EIS eligible, weâll let them off. Shares are held under the crowdcube nominee, so crowdcubeâs nominee actually own the shares, and investors are âbenificiary ownersâ. This can have nasty implications, most infamously such as when Monzo investors were asked to change the terms of their investment. Just think of it as rather than you owning your Tesla shares, say,someone owns them for you. Itâd ultimately boil down to how much you trust that person; so I encourage all investors to rifle through the terms, which Crowdcube tend to send out one week after campaigns close.
Valuation and exit
ValuationI see the business as overvalued by most measures given that growth is middling (doubling revenue over 2 years, 200k users acquired since native app launch in 2015) and revenue is only ~ÂŁ1m, implying a 21x multiple. The very company they use as an M&A example , Mint.com, sold at a 17x multiple at a much later stage â admittedly long ago in 2009. Iâll add that high valuations are symptomatic of the wider capital markets in any case. Not to say MDB wonât give a decent ROI, but the reward is being eaten up and the risk piled on by the price, in my opinion.
ExitMoneydashboard look to exit by acquisition, and hope to provide atleast a 5x return. I consider this quite reasonable, and itâs promising theyâve allegedly already had interest. Big data is forecast to be a multi-billion pound market, offering a large market opportunity. They cite Mint.comâs sale to Intuit for $170m is cited by MD as evidence of interest in this space.
Thanks for reading, hope this helps
P.S. Iâll be adding updates, corrections, relevant links and references as I dive deeper in due diligence and tweak this post!
N.B. This post does not constitute financial advice. Please see Crowdcubeâs risk warning for an outline of the risks involved in early stage companies. All opinionâs are my own.
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I agree, it looks like a way to make their crowdfunding look successful, maybe they wouldnt hit the target without this.
Probably helps to pump up the interest a bit, just my speculation.
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Not really. It is a general practice to declare the parallel funding secured (from VC or HNIs out side the.platform ) as it helps the crowd investors following aspects
- dilution discussions/dispute about pre emption round if disclosed after the round
- giving clarity how much equity is given away by the company
3)confidence to retail investors that current round is being validated by VCs which is a good thing. BTW I found this is one of the negative point in FT current round where the valuation was very high and no professional validation rather a gut feeling ( with comparing Monzo/Revolut). I sincerely hope that in future rounds when again valuation will keep increasing for FT, they will have backing of a VC. - give investors a sense of security that as they already achieved the minimum funding required for this round so this round will not be cancelled even if there will be a lack of participation by investors e.g. Mortgagegym on Seedrs was cancelled after 1 month as it couldnât reached its target âŚ
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It may be common practice, but that doesnât make it any less disingenuous.
There is an increasing trend where crowdfunding companies set the minimum bar both artificially low and at exactly the same level as a lump sum investment from either a VC or a HNW individual.
It creates the illusion of demand, whilst on my eyes crowdfunding is all about showcasing demand to strengthen the evidence of product / market fit.
In your example of MortgageGym, I think the outcome was as it should have been. Not enough demand from crowd investors, so clear concerns about product/market fit, something that would have been skewed if a single investment would have filled their minimum target from day one.
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I agree with this point and ideally would expect companies to set it higher than agreed amount unless it is confirmed at later stage.
On the other hand, most of the time I would do my own DD before investing rather than just measuring % oversubscribed ratioâŚthe example of mortgagegym I gave because I personally liked the business and pledged but it was cancelled 
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Completely agree it should be declared, but could they not announce the funding without adding it on to the crowdcube total? That way investors can have the full picture without skewing the crowd funding. Just my 2c
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Unless all the platforms (seedrs, CC, SR) carry out an upgrade/changes to display these figures separately in their websites/app, I doubt that they can do it. Considering it is not a priority for them , they would argue that this information is disclosed by the business in the pitch so as a sophisticated investors we shouldnât be relied on the % oversubscribed figure 
Moneydashboard announces Coinbase integration. I guess thatâs good timing since cryptos have been going up again. In the comments someone very sensibly suggested Student Loans Co as an integration.
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I wrote to them on Crowdcube and said that they are very reliant on open banking being available. They said they they will integrate with all major UK banks open banking APIs this summer, which sounds positive.
Anyone interested in Money Dashboard as an investment? I used it a bit a few years ago, not convinced that it will achieve big growth though.
Anyone getting in on Money Dashboard? Theyâre raising at the moment and seems like it has good potential, theyâre market leaders, user data trends are becoming more valuable I think these days.
Iâve used them a few years ago, but quit because there was no open banking integration in the UK. This is now available, so makes using their platform much more appealing.
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