London fintech Monese says it needs more cash to survive after Pockit takeover
Monese has warned it will need fresh investment if it is to survive for another year as the London fintech embarks on a change in strategy to put itself on a firmer financial footing.
The current account and money transfer business, which last year was acquired by fintech firm Pocket in a rescue deal, said it was “likely further funding will be required within the next twelve months” as auditors Blick Rothenberg warned there was a “material uncertainty” over the firm’s operations “that may cast significant doubt on the group’s and the company’s ability to continue as a going concern.”
Monese said discussions were “underway with investors and financiers” and insisted that directors were “confident” it would be able to raise sufficient funds to continue trading.
Founded in 2015, Monese raised $60m in a Series B funding round in 2018, courting the likes of Paypal and British Airways owner IAG among investors.
Troubled history of a struggling app
The firm secured a $35m fundraise from HSBC in 2022. But just two years later, the fintech warned on its uncertain future after consecutive years of losses, prompting HSBC to write off the value of its stake. HSBC attempted to launch its own rival app, called Zing, but shut it down after just a year.
Monese spun out its technology arm, XYB, into a separate company, while the current account business was acquired by fintech firm Pockit in October last year, which handed it £6m in equity funding to keep the business afloat. Monese and Pockit also arranged a combined debt financing in June.
Speaking at the time of the acquisition, Pockit founder Virraj Jatania said: “This is a transformational acquisition for Pockit. It immediately propels us to a size where we can support financial inclusion for a critical mass of people who would otherwise be locked out of mainstream finance.
“While nothing will change for our three million customers in the short term, over time this deal will result in new products and an enhanced in-app money management experience.”
Monese’s latest accounts, submitted a year late, show it made a small profit of £705,000 in 2023, turning around a loss of more than £30m the previous year, while revenue jumped from £26.8m to £48.8m.
The next set of accounts are due at the end of September.