FNG Exclusive… FNG has learned that some major changes are afoot at Monecor (London) Limited, the FCA licensed entity that operates the OvalX online trading brand.

First, some quick background.

Monecor was acquired in late 2020 by Swiss fintech investment firm Guru Capital SA, run by ex Swissquote executives Ryan Nettles and Luca Merolla, with backing from US venture capital firm Jump Capital. Monecor then operated the Retail FX and CFDs brand ETX Capital. In mid 2021 the group acquired Italy-based savings app Oval Money, and since has worked on merging the two businesses, eventually deciding last year to rebrand the entire business as OvalX. Late last year Guru partner Luca Merolla took over as CEO.

Well it doesn’t look like things have gone exactly to plan, with Revenues being sluggish as trading volumes fell, and costs of combining the two businesses and running out of three “headquarters” (London, Torino, and Limassol) piling up. In 2021 – the first year under Guru Capital stewardship – Monecor saw its Revenues fall by 24% to £24.2 million from £31.8 million the prior year, with a net loss of £6.9 million, and we understand that things didn’t really turn around in 2022.

So, what is now happening at OvalX?

Well, several things.

1) Changes at the Board level. Guru partner Ryan Nettles is taking a step back from the company and stepping off the Monecor board, and will be focusing on other projects at Guru.

2) Layoffs and cost cutting. As part of an ongoing cost cutting and efficiency program, we understand that the company is looking at laying off a good portion of its staff, including many in product development, customer service, and marketing. While we understand that the company has not yet given formal notice to any employees, it is consulting with various stakeholders regarding cost management and strategic solutions to drive down costs.

3) Exploring sale of certain assets. We understand that OvalX and its board are involved in active discussions with at least one more broker, regarding a merger or sale of much of OvalX’s assets to that broker.

In the meantime, it does seem that otherwise it is still business-as-usual for OvalX, although with a smaller team, and with the parent company (Monecor) remaining well capitalized. Monecor reported total equity of £18.4 million as at year-end 2021, and during 2022 the investor group added several million Pounds more into Monecor’s balance sheet.

Speaking exclusively to FNG, OvalX CEO Luca Merolla said:

“It’s business as usual at OvalX. We’re a well-capitalised business. The global economy has suffered and the wider industry experienced a significant reduction in trading volumes in 2022, and we were no exception. As a result, we continue to explore various strategic options.

I want to assure our clients that the OvalX trading support services and customer experience is operating on a business-as-usual basis, and we will maintain the standards that our customers have become used to.”

We will continue to follow this story as it develops.