More than five years after starting the company, Monzo co-founder Tom Blomfield is stepping down as CEO of the U.K. challenger bank to take up the newly created role of president.
Current U.S. CEO, TS Anil, will become the new “Monzo UK Bank CEO,” subject to regulatory approval, and for now will hold both U.K. and U.S. roles.
Anil previously held exec roles at Visa, Standard Chartered Bank and Citi, and therefore brings a ton of banking and financial services experience. This includes things like dealing with regulators and overseeing a large corporate structure, two things a scale-up challenger bank like Monzo, with more than 4 million customers and over 1,500 staff, requires.
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.
In a brief call with Blomfield just moments ago, he told me he had 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.”
Although it is unlikely that a huge amount will change immediately, Blomfield says he hopes that he’ll be able to spend a “bunch more time doing the stuff I really, really love, which is community, talking to customers, helping develop the product proposition, long-term vision, and talking to journalists, like you Steve, obviously, and try to unwind my involvement a little bit in more formal regulated banking activities.”
Meanwhile, it has been somewhat of a turbulent time for Monzo in recent months, as it, along with many other fintech companies, has attempted to insulate itself from the coronavirus crisis and resulting economic downturn.
Last month, I reported that Monzo was shuttering its customer support office in Las Vegas, seeing 165 customer support staff in the U.S. lose their jobs. And just a few weeks earlier, we reported that the bank was furloughing up to 295 staff under the U.K.’s Coronavirus Job Retention Scheme. In addition, the senior management team and the board has volunteered to take a 25% cut in salary, and co-founder and CEO Tom Blomfield has decided not to take a salary for the next 12 months.
Like other banks and fintechs, the coronavirus crisis has resulted in Monzo seeing customer card spend reduce at home and (of course) abroad, meaning it is generating significantly less revenue from interchange fees. The bank has also postponed the launch of premium paid-for consumer accounts, one of only a handful of known planned revenue streams, alongside lending, of course.
And just last week, it was reported that Monzo is closing in on £70-80 million in top up funding, to help extend its coronavirus crisis runaway. However, as new and some existing investors play hardball, the company has reportedly had to accept a 40% reduction in its previously £2 billion valuation as part of its last funding round last June, with a new valuation of £1.25 billion.
With that said, it’s not all been bad news. Monzo recently launched business accounts, many of which are revenue generating, with both free and paid tiers. It also recruited Sujata Bhatia, a former American Express executive in Europe, as its new COO.
And, hopefully, in his new role as president, Blomfield will sound re-energised next time I call him.