Monzo's now a unicorn! 🦄

Monzo nearly hitting 2million users :eyes:


Boop! I think it was rumoured previously but now confirmed.


There’s another work for a double unicorn.

It’s called a cow.

Well over 2 million now

Monzo published their annual accounts for 2019 :partying_face:

I’m going to dive in later, would be interesting to see what comes out of it.


From a first read of the CEO’s review, this quote is particularly interesting:

We’ve grown revenue considerably: we’ve just crossed £40m of annual run-rate revenue (based on May 2019 revenue), but there’s still plenty of work to do to get to profitability. Around 30% of active users deposit at least £1,000 per month (our definition of ‘salaried’), up from 13% a year ago.

Per-user contribution margin (revenue minus variable costs including expected credit losses) is a key metric that we’ve worked to improve over the last couple of years. It tells you whether each active customer using Monzo generates more incremental revenue than they create in cost. Annual per-customer contribution margin is now +£4 as at May 2019, up from -£15 a year ago, and -£65 in 2017. The longer customers are with us, the more profitable they become, and salaried users contribute +£30 – mainly driven by the money we make when people use their Monzo cards.

This means that if you get your salary in Monzo, you are helping them make about £30 pounds per year from the card usage alone, not including the liquidity you provide to the bank for it to be able to loan, or if you have savings pots from which they are also being paid.


I recommend listening to Tom’s keynote speech from yesterdays investors event, available here.

(From 25:50)

Edit: did I spot @Freetrade_Team1 in the crowd as Tom came on :grinning:


How/why is Monzo paid for card usage? Can someone explain this?

I believe the merchant pays a small % to the bank for each transaction

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The interchange rate


Thanks! :slight_smile: I always incorrectly though that the Mastercard/Visa were the only party receiving a percentage of the transaction.

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You were right but MasterCard (& Visa) often pass on part of that percentage to the ‘issuer’, which is Monzo in this case.


If Freetrade was to become a unicorn, what number do you think the users would need to reach?

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I’m not sure it would purely be determined by user number though that is an important aspect

I believe monzo had around 1.2 million but someone might be able to correct me

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Are Freetrade users ‘worth’ more individually than Monzo users?

e.g. does assets under management have value to Freetrade and therefore in theory value per user is higher
Or are customers only valuble when they actively trade/subscribe!

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Buy low sell high

Doesn’t matter as much as you may think as various variables are at play including external factors like the global market cycle, etc. If investors use the user number as a gauge then it is X compared to the closest competitor. Mind you, RH was launched after the last crash and it took some time for the ripple effect to kick in. Word of mouth and the network effect helped even Snoop Dogg swing by and park his cash there. That was great PR plus the proximity to the world’s top VC offices in the Bay Area. Valuation is an art form and things like which VCs (high calibre vs low calibre) play a big role too. 80% of everything here is psychology, the power law, when the more you hear about a company the more attention it gets, the more likely some guy wearing a Patagonia vest invests a few million and increases your valuation. Also google the Matthew effect.


It can’t be a good answer but I appreciate it. I barely studied this stuff. It’s relative in the financial markets in my experience…

Some analyst’s spreadsheet-based valuation model could be adjusted by his superior because the price was agreed on already by chief dealmakers before the modelling was done…can determine the valuation.

True story from an ex-M&A guy now a professor.

It can be silly. Think Nokia and Microsoft buying and writing it off. Or Yahoo and Tumblr. Or Aol/Verizon and Yahoo. We can’t make it up but were the numbers when those companies were valued by numerous advisers made up? It’s kinda all art and throwing :dart: plus luck and hard work.

Speaking of secondary markets, I’ve been contacted on some crowdfunding site about some entities looking to get hold of shares in a certain privately held tech firm, so I assume some sites that enable crowdfunding also facilitate secondary sales.



No - it has been backed purely by VCs / PE houses. You can only invest in these funds if you are an institutional investor. So the only way to gain access to Monzo is as a crowdfund investor.

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Monzo just hit 3 million sign ups