According to figures released in July by UK fintech trade body Innovate Finance, fintech investment this year is not looking good. It stands to reason: the economic system of the whole world has taken a massive hit thanks to covid-19, and no industry sector is safe.
Innovate Finance said that £590 million was invested in UK fintech in the second quarter of 2020, compared to £940 million in the same period last year. That’s a big drop. However, it’s still a big number, and there are some shining examples of UK fintechs doing well in this period.
Once such a company is the London-based Moneybox. The savings and investments platform announced a €33.07 million series C funding round in July backed by a number of investors, including Eight Roads, which has been working with the company for some time.
Shortly after the series C funding round, Moneybox also carried out an equity crowdfunding round, which raised a further £6.8 million for the company.
The company is one of a growing band of apps and web-based platforms which help people make more from their money. There are a number of well-known challenger banks that come under the fintech banner – including household names like Monzo, Starling and Revolut – which all attempt to help consumers make better use of their money through analysis and cheaper fees, but Moneybox also falls under another category.
Moneybox, like others such as Nutmeg, Wealthsimple and Wealthify, is a platform for saving. When it launched, it offered users the chance to invest spare change from card purchases to put into stocks and shares ISAs, and it now offers a wider range of investment and saving products like lifetime ISAs and pensions.
And despite being in a crowded and competitive market, Moneybox is doing well and growing fast.
Investing in investment
Moneybox has more than 500,000 customers and 170 staff. It has more than £1 billion in assets under management – meaning a significant number of its customers have invested a large amount of money via the platform.
Such growth is reflected in the ever-increasing investment the company has seen in its various funding rounds. It has received a total funding amount of $69.9 million since its inception in 2015 through five funding rounds and with three lead investors.
They received $4.8 million in two seed funding rounds in 2016, through Samos Investments and Oxford Capital Partners. Later, a further £14 million in investment received in a Series B round in 2018, with four investors coming on board, led by Eight Roads Ventures – the same firm that led the most recent series C funding round.
Making cash go further
Fintech firms have been on the rise for some time now, but investment and savings platforms such as Moneybox are in a particularly good position thanks to covid-19. Although the world economy is facing a significant downturn, quite a large portion of people have built up significant savings during the lockdown, thanks to the work-from-home phenomenon and with holidays and social occasions out of the question.
With traditional cash savings accounts offering so little in the way of interest, people are hoping to make their cash go further – and beat, or at least match, inflation – meaning they are increasingly turning to investments such as stocks and shares ISAs to make their new savings go further.
The consumer desire to make money go further appears to have greatly benefited Moneybox, which recently made it into the Deloitte Fast 50, where it was ranked as the seventh-fastest growing UK technology company, notching up 5,270% revenue growth in the last four years.
And with an increasing number of staff, customers and assets under management, moneybox hired a new high-flying chief operating officer. Karen Kerrigan started as the company’s first COO in late November when she took on responsibility for the risk, compliance, governance, customer operations and people functions at the organisation, as well as the role of company secretary.
The hire of a professional c-level executive is often a sign that fast-growing startups are maturing, and it looks as though Moneybox is no different. Fintechs have been hugely disruptive to the traditional banking sector, and, on its current trajectory, it seems Moneybox may be the next firm to make waves. Investment, and new employment opportunities, will no doubt continue.