Monzo Crowdfunding 2018

Interesting that the ÂŁ2,000 values looks like it might be second highest (close call).

A mixture of wanting to be part of Monzo and wanting to profit from Monzo maybe.

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The gambling block thing seems like a Good Thing, and it’s opt-in. You could imagine a bank that took that idea much further and only let you do virtuous things that are good for you - stop you buying cigarettes, or prevent you from having an overdraft etc. It’s weird imagining a bank that had opinions about how you should spend your money - it would be a new kind of bank. Services that act as your better self when you’re having a moment of weakness…

Or a stockbroker/inv platform that wouldn’t let you buy fund X while there was a fund Y that did the same job but that was cheaper (a service I would use).

May also be ethical/transparency questions about processing user data to generate behavioural nudges that (yes, benefit customers, and) serve a commercial goal. Questions about how the data is used, how the decisions get made.

They couldn’t stop you buying cigarettes as it’s a merchant code they block for the gambling. There are other things behind the scenes you can request if you’re a vulnerable customer to do with limits and overdrafts and there’s hopefully a few other things to come

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Do you work for Barclay’s Rod?

ha ha! no I don’t @Jonny - I write things like this (shameless self-promo!) for a living, so fintech/banking stuff sometimes comes up.

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I’ve had a couple rants already today about how what Barclays have done is great in principle but rubbish in reality. Hopefully Monzo add some friction to disabling the restrictions

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With the greatest respect if you’ve never had to deal with it you’ll never understand. Willpower can be shaky, added friction can get you over a difficult time until you’re able to make the right decision again

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There’s a really good story from a Monzo user called Danny about how helpful he’s found their block, check it out -

Here’s Martin Lewis’ explanation of why this is important too, which is based on the research that the Money & Mental Health Policy Institute (founded by him) has done -

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Maybe not at that stage, depending what they’re dealing with, but people in recovery or people who have identified they have an issue and are able to tackle it themselves.

If you read what Alex posted about Danny you can see how much it helped him

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It certainly is the best call to seek professional help and every case is individual. However, there is nothing wrong if Monzo imposes this light touch of self-control possibility.

Also, the button cannot be turned off immediately, there is a lag hence will be better than nothing when you are wandering around High Street thinking of getting into the gambling house - you will not be able to to that impulsively.

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You’re right that a button could never replace professional help. But a button might help a tiny bit - the testimony suggests that for some people it has. Sorry to hear about your friends, very sad.

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Simon VC from Monzo mentioned how the gambling block started on the 11fs podcast a few months ago. In a nutshell it was started by James* during Monzo Time, then turned into a multi-team collaborative effort, and they looked at existing behavioural research to make it as effective as they can.

There was a lot of research behind Monzo’s decision, Barclays seem to have done it because they can, still it’s a good step, and hopefully they’ll expand on it based onfeedback.

*in the podcast he just says James…

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Seeing as Freetrade is quite close with Monzo. Is there any future plans to store crowdfunded shares in your platform?

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Doubt it will make sense unless Monzo IPOs. Shares obtained in crowdfunding are illiquid and of a different nature to the stock market participants’ shares. Hence it would not make sense to mix those with the normal portfolio.

That being said, Monzo said the IPO is one of the potential exits, and if by then Freetrade will be big enough and capable of facilitating that offering, it would be a massively unprecedented event. Even now I can imagine news titles being “challenger broker facilitates challenger bank’s IPO bypassing financial dinasour-firms” :grin:

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That would be awesome! :smile:

Monzo has trademarked the text “POTS” according to a IPO search. Maybe it doesn’t cover the cases other banks are using it in?

Monzo have also trademarked “COIN JAR”, which is interesting.

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Those are individual saving accounts the exact same as banks have been using for years. Not the same as Monzo have (which take seconds to set up, not minutes)

Calling them pots, well Monzo have a legal department who like to keep busy. Trademark law and usage is complicated so I don’t know exactly the situations where it doesn’t break the rules :woman_judge:

A lot of banks have freeze card now. A lot of banks are introducing gambling block. They are all playing catch up while Monzo do the next thing. There are some very exciting things coming this year which I’m 100% sure won’t look as ugly as that Bank of Scotland image :grin:

Why is having a physical branch network a bonus? It’s a huge cost for no benefit. Monzo already offer loans and overdrafts, mortgages may come in the form of an integration at a later date.

I think they are persuading people to switch, they’ve acquired over 1.3 million users in about a year and the weekly new sign ups are increasing. The CASS stats also back this up. Business accounts are coming as well as American and European expansion.

If the only thing you think separates them from high street banks is a pretty app then you’ve missed a lot. The fact they’re being copied isn’t a big deal, it just shows they’re doing it right

Branches are a massive liability (rent, rates, retail staff). This is monzo’s strongest advantage and will allow them to expand much quicker with low cost.

Re branches being useful - I haven’t deposited money in a bank for over a decade. Habits change and cash is becoming less and less relevant. Monzo probably view the current solution as a stopgap till no-one cares about cash.

Re features being copied, this is par for the course and will continue, but that’s to be expected. Monzo will just come out with new features like paying with a link, and if others are always playing catch up, why not go with the original. The same can be said of freetrade or any other startup - when incumbents notice they’ll try to copy ideas but they can’t copy low overheads and a smaller, nimbler org.

I think Monzo’s biggest challenge right now is growth, not legacy banks. If they get more customers their low overheads will become more apparent and network effects will make it easier to grow more.

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I’m fairly certain Tom has said something along the lines of “Monzo will have succeeded if the legacy banks copy us”.

If he hasn’t, then he should :joy:

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