The FGB Digest brings you the latest news on the world’s fastest growing direct-to-consumer and challenger brands. In today’s edition: Monzo raising at lower valuation; Ettitude raises USD$1.6m for new categories; and Troubadour passes target on Seedrs. 

Monzo raising at lower valuation

UK challenger bank Monzo is reportedly raising a fresh round of cash from investors at a 40% discount to its previous fundraising.

The fintech is close to sealing a deal that will value it at around £1.25bn, compared to a valuation of more than £2bn at its previous funding round in June, according to the Financial Times.

The drop in its valuation comes in the context of the coronavirus pandemic and the ensuing economic chaos as growth slows and venture capital firms become increasingly cautious about investing in loss-making businesses.

The report said Monzo was planning to raise between £70m and £80m in the current round. It is understood that the money raised is being sourced from both new and existing investors. The FT reported that the deal is expected to close within the next month. Monzo was already seeking to raise cash before the coronavirus pandemic hit the UK.

Monzo still has its sights set on growth and last month applied for a US banking licence as it looks to expand across the Atlantic. However, it could take Monzo between 18 months and two years to have its application approved. The process, run by the US Office of the Comptroller of the Currency, is more stringent than other countries’ such as the UK.

Ettitude raises USD$1.6m for new categories

Ettitude, the Los Angeles-based, direct-to-consumer startup making sustainable bedding and sleepwear from bamboo fibres, has raised a sustainably sized round that should keep the company going even in the face of an economic recession.

Sourced from a factory in Zhejiang, China, near Shanghai, the bamboo textiles are made using non-toxic solvents and a closed-loop system that reuses water for the process. 

Co-founder Phoebe Yu started selling the cleanBamboo-branded bedding under the ettitude label in Melbourne first, but when she saw the orders begin to pick up from the U.S. she relocated and took her company with her.

Sales are growing and the company’s chances have certainly been improved by the capital infusion from Drumbeat Ventures and TA Ventures, a European female-founded fund focusing on technology innovation.

The USD$1.6m financing will be used to boost sales and marketing as the company expands beyond bedding — with an average price of USD$178 for a queen-sized sheet set — and into sleepwear and other categories.

Troubadour passes target on Seedrs

Troubadour Goods is fundraising on Seedrs, and has currently raised £603k - 121% of its initial target. Troubadour is a London-based brand that designs, creates and sells premium men’s bags and accessories.

The business sells directly to customers through their website and via more than 60 stores. Among other well-known names, retail partners include Harrods, Liberty of London, and Harvey Nichols in the UK, Nordstrom, Bloomingdales, and Mitchells in the US, and Matches Fashion, Farfetch, and East Dane online.

Troubadour began selling seven years ago and have had a compound revenue growth rate of 56% between 2013 and 2019. The business is backed by a London-based venture capital firm.

Approximately half of the funds raised in the current round will be used to support sales growth to Troubadour customers and retail partners. The other half will be used to fund working capital requirements from the company’s forecast growth plan.

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