The two biggest fintech stories of the last couple of weeks have both featured Monzo.
The first, broken by the FT
but since confirmed by my own sources, is that the UK challenger bank is closing in on £70-80 million in top up funding, to help extend its coronavirus crisis runaway. The headline, however, is that due to investors playing hardball, Monzo has had to accept a 40% reduction in its previous £2 billion valuation, with a new ‘down round’ valuation of £1.25 billion.
As I wrote for TechCrunch, the thinking behind Blomfield’s move to president is a startup cliché but also likely holds water; he’ll be able to spend more time doing the things he enjoys most (and is arguably best at), such as focusing on the longer-term vision, product and how Monzo can stay close to and best serve customers. Meanwhile, Anil — and, in the future, other country-specific CEOs — can do the day to day, more regulated aspects of running a bank.
I interviewed Blomfield
on the day the news broke and he told me he’s been thinking about a transition into a different role for about 18 months, but it wasn’t until much more recently that a formal decision was taken.
“I went through all the stuff I love about my job, and it was all the stuff I did in the first two or three years,” he said. “And I went through all the stuff that drains me, and it’s all the stuff I’ve done in the last two years, honestly. Things I think TS is awesome at.”
Naturally, all the usual news outlets followed my story (and, I’m pleased to say, gave credit). However, whilst my headline was very specific - ‘Monzo co-founder Tom Blomfield moves from UK CEO role to president’ - others used the phrase ‘steps down,’ leading to a slightly bizarre twitter spat between David Brear of 11:FS and Sifted’s editor Michael Stothard.
It all began with this tweet
from Brear, followed by a rebuttal
from Stothard and then a quote retweet
retaliation from Brear. “Now you’ve only gone and created a public fintech fight,” one newspaper journalist messaged me shortly afterwards. Although, to be fair, 11:FS and Sifted have previous form after a story by Sifted’s Isabel Woodford was critical of 11:FS and its involvement in Mettle, the business banking upstart from RBS. Woodford, a rising star in fintech reporting, didn’t hold back
, leaving the 11:FS CEO more than a little unhappy.
The same day Monzo’s news broke, Brear and his 11:FS co-founder Jason Bates held an ‘ask me anything’-styled video podcast and, along with riveting questions like, is a hotdog a sandwich (answer: no, of course not), the topic of discussion turned to Blomfield’s move to Monzo president. The normally pretty zen Bates gave a perfectly reasonable answer
before launching into a monologue about ‘media and news outlets trying to twist stories for clicks’. Furlough me already, will ya!
Meanwhile, twitter spats aside, what do I really think of Blomfield’s move to president? As the only journalist to hear straight from the horse’s mouth, I’m inclined to believe the narrative that this is largely about enabling him to focus on the things he’s arguably best at.
It’s also worth remembering that Blomfield’s new title is founder-president of Monzo, so still very much in a leadership position. Furthermore, the ‘CEO’ title has a very specific and legal meaning in a regulated UK bank and comes with a lot of mandated responsibilities. My understanding is that he couldn’t relinquish some of those responsibilities in a legal sense without also de-registering as CEO with the regulators.
More broadly, sources close to the challenger bank tell me that, rather than investors pressurising Blomfield to change roles, as has been speculated, it was actually the other way round. Despite his desire to find a different role away from some of the more regulated aspects of running a bank, investors were initially nervous about the signal a change in title could send to the market.
Am I being sold a line? It’s quite possible, of course. However, to answer that question, I’m going to set a simple test: Is Blomfield still in post in ~3 years time? And, if so, how much further along is Monzo in its stated mission to create a bank that is 10x better than what previously existed. From the many conversations I’ve had with Blomfield over the last 5 years, anything less will be deemed by him as somewhat having failed.
Monzo’s new acting head of PR is no other than ex-TechCrunch journalist-turned-flack Drew Olanoff
. I guess that’s one way of trying to stop me in my tracks! 🤫