Funds giant DE Shaw in talks to back £7bn digital bank Monzo

An American fund management giant is in talks to lead a capital-raising at Monzo, the UK-based digital bank, which is likely to value it at over £7bn.

Sky News has learnt that DE Shaw & Co has indicated its interest in leading a fundraising of at least £300m for Monzo in the coming weeks.

The eventual figure could be between £300m and £500m, according to insiders.

Sources said the deal was likely to value Monzo at about £7bn on a pre-money basis, although they cautioned that the terms had yet to be fixed and that other investors were also in discussions with the company.

DE Shaw manages roughly $125bn in assets, according to the latest figures, and has become a major investor in technology disruptors.

Among its holdings is a position in Anthropic, the AI giant which is pursuing a US listing valuing it at up to $1.5trillion despite the recent sell-off in AI-related stocks.

If it proceeds with an investment in Monzo, it would add DE Shaw to a share register which includes an arm of Google and a Singaporean sovereign wealth fund.

Crucially, DE Shaw's consistent record as a backer of companies with near-term listing ambitions will again dangle the prospect of a Monzo flotation in the coming years.

Monzo has been exploring fundraising or the sale of a stake to a private equity firm in recent weeks after a takeover of the whole company by New York-listed Nu Holdings collapsed following a Sky News report on the prospective £8bn to £10bn deal.

The Financial Times reported last week that Monzo was in talks to raise capital at a £7.5bn valuation.

Monzo has amassed a 16 million-strong customer base, with 15 million of those personal banking customers along with a million users of its business banking services.

That scale makes it comfortably one of Britain's top 10 banks, little more than a decade after it was founded by a group of entrepreneurs including Tom Blomfield.

Monzo was last valued at £4.5bn in a secondary share sale conducted in October 2024, with its value having risen very significantly during the ensuing two years.

In its most recent annual financial results, the company reported a 39% surge in revenue to £1.7bn, with adjusted pre-tax profit 20% higher at £172.6m.

Monzo has been hailed for years as a UK fintech champion, with its rapid growth and record of innovation helping it to become one of the most valuable scale-ups of the last 20 years.

Its most recent launch was Aura, which it says is the first credit card in the UK that lets customers automatically invest cashback as they spend, allowing them to balance daily rewards with building long-term financial progress.

Government ministers and the London Stock Exchange have been engaged in vigorous efforts to persuade Monzo to list in the UK, with a stock market flotation a strong possibility in the next two years.

More from Sky News:
Investigation over Nvidia CEO's 'affair'
Gunman who killed six in Poland dies

However, a US listing would also be on the table given the geographical bias of the bank's investor register, meaning an initial public offering in London would in any case be far from assured.

Monzo has been through a leadership transition this year, with veteran banker Gary Hoffman stepping down as chairman and Diana Layfield, a former Google and Standard Chartered executive, arriving as its new CEO.

A shareholder and governance row erupted late last year over Mr Hoffman's push to replace former chief executive TS Anil with Ms Layfield.

Monzo declined to comment, while DE Shaw failed to respond to several emailed requests for comment.

(c) Sky News 2026: Funds giant DE Shaw in talks to back £7bn digital bank Monzo