Monese founder will buy consumer arm in case of dissolution | Business News

An HSBC-backed technology company that was in talks to raise funding at a valuation of more than a billion pounds four years ago will this week confirm a plan to spin itself off amid mounting losses.

Sky News has learned that Norris Koppel, founder and chief executive of Monese, will take control of its consumer arm as a stand-alone entity.

Tera Ventures, an Estonian venture capital firm, is said to support the plan.

Meanwhile, its business-to-business arm, XYB, will be spun off and run as a separate entity by a new boss, according to people close to the company.

Monese’s board would be finalizing the plans on Monday night, with an announcement expected on Tuesday, they added.

The split plans were reported by Sky News earlier this month.

Monese targets customers who are underserved by traditional banks and has around 2 million customers in more than 30 countries.

It employs around 275 people.

Fintech has been under pressure from some investors to spin off.

London-based banking giant HSBC invested $35 million in Monese in 2022 in exchange for a stake in the company.

A Monese spokesperson said earlier this month: “The business has developed in two different directions: the original B2C business and now the new and fast-growing B2B PaaS (Platform as a Service) business.

“We are exploring the best organizational and capital structure for the company, maximizing value for shareholders.”

In the accounts presented earlier this year, Monese referred to “material uncertainty about the success of future fundraising and, therefore, about the company’s going concern situation”.

Its other shareholders include Investec and Augmentum, the London-listed fintech investor.

At the time of the HSBC deal, he said he had raised a total of more than $200 million.

A source close to the company insisted that it started 2024 on a solid footing, following a robust performance last year.

They said Monese has seen continued revenue growth and losses reducing from £30.5 million in 2022 to single-digit millions.

“The company is approaching profitability in the near term,” they added.

Monese and Interpath Advisory, which has been working on the restructuring, declined to comment.