London (CNN Business)Monzo, the popular UK banking app, has boosted its financial firepower as it prepares for a US launch.
The company said Tuesday that it has raised £113 million ($144 million) from new and existing investors, led by influential US startup accelerator Y Combinator. Other investors in Monzo include Joshua Kushner’s Thrive Capital and payments company Stripe. According to the company, its valuation has roughly doubled to over £2 billion ($2.5 billion). Monzo, which was founded in 2015, has more than 2 million users in the United Kingdom and is adding 200,000 more each month. It’s best known for its bright coral cards and appeal among young professionals. Britain's wildly popular Monzo banking app is coming to AmericaThe funding round was closed shortly after Monzo announced plans to launch in the United States, an expansion that promises to be expensive. Read MoreNavigating financial regulation is much harder in America than in much of Europe, since companies have to gain approvals state by state.Monzo was able to obtain a banking license in the United Kingdom in April 2017, which allowed users to perform bank transfers and set up services such as direct debits and deposits.It won’t enter the US market with such a permit. Instead, the company is partnering with the Ohio-based Sutton Bank, which is overseen by the Federal Deposit Insurance Corporation.Plus, there’s already plenty of competition in the United States for deposits, from traditional banks to tech companies such as Paypal (PYPL). But investors seem confident that Monzo’s app, which includes features such as instant spending notifications, has the potential to break through.