Friday, 22 September 2017

Crowdcube's bad haircvt success fails

Haircvt raised £190k on Crowdcube in 2015. Now they have closed. They failed to raise their required £1.5m, so thats it.

Sound familiar? Well that's because it is. If a company's projections show a future cash requirement of £1.5m and this evapourates, you can be pretty sure the company will close. It happens on Crowdcube rather too often.

What happened to the £190k is anyone's guess - few trips, few nights all adds up you know. It's not a bad wheeze. Unless you were one of the 122 Crowdcube punters.

Facewatch looks the other way

More target practice needed for Crowdcube funded Facewatch

Taking £500k off Crowdcube punters was easy compared with aligning the real world with the projected one.

Facewatch i admits to being a long term journey - well they did in the accounts. However they didnt in their Crowdcube pitch. Filed accounts for YE March 17 show losses of £800k against the fantasy version AKA Crowdcube  - of just £129k. For YE Mar 2018, this company sold equity using a projected profit of £2.9m.

I will definitely eat my hat if that's true.

Whats up at Superjam and Beer52?

Fraser Doherty has run Superjam or Eat Super for many years. They raised around £300k on Crowdcube a few years ago. He is also a hands on director Beer52, an Edinburgh based beer subscription site which raised £100k on Angels Den  in 2014 and then another £800k privately via HNW individuals last year.

We have written about both here and here. 

It is difficult to understand the figures as related to both companies. Superjam should, according to the Crowdcube vision, be making over £1.5m profit but instead made £3k on what appears to be a modest turnover. They seem to have lost all of their major UK listings apart from a one jam , heavily discounted offer in Waitrose. They were everywhere.

Beer52 have done better but articles that appeared after the 2016 funding stated that their 2015 turnover was £2.6m and in 2016 it was going to be £8m. Nothing in the accounts filed (to June 17) suggests figures of this size. Losses have become breakeven over the period. Not the vision that Angels Den promoted. 

Anyone any ideas?

Luxtripper goes to the US as a success story

Luxtripper is a Crowdcube double success - it has taken £750k in two piles. Now it has burnt both loads and filed losses of £500k for YE March 17. New investment is promised and a Government grant of £150k has come to rescue.

We have written then before here - the last time they faked a solicitor's letter that they sent us. In May the founder, Nena Chaletzos, was taken to the US as one of the UKs 15 leading female start ups according to City AM. 

For their YE Dec17, this company projected profits of £4.5m. Accumulated losses are now over £1m whereas projections show them at a profit of £300k plus. 

How any of this makes sense is anyone's guess. Clearly investors and the Government know things we dont.

Thursday, 21 September 2017

Workabode is idling after taking £270k off Crowdcube

Workabode sums up so many of Crowdcube's flaws. More than 36 months after its initial raise, in a business sense it's still inactive, unproductive and empty.

Workabode is the brainchild of Trevor O'Hare. He was kind enough to respond to our recent invitation to discuss Workabode's progress. His response - we dont want to talk.

He has used Crowdcube twice to pull out almost £300k of investment for the company. Clear intentions made in the first raise in 2014, melted away and the balance sheet in the second raise in 2015, was simply wrong. It had missed out over £200k of accumulated losses(filed in the real accounts) - which is a material omission. It also illustrates an alarming ineptitude for figures and a far too common ineptitude from the CC Broom Cupboard, for DD. They had after all sanctioned the first raise in 2014 with the right figures!

In the second pitch in the summer of 2015, the company claimed it had completed the eCommerce platform  - well you have wonder if you look at the site in 2017.

Trevor has other companies - One City Innovation which does very little and Blueventus Ltd which was dissolved and for which we could find no records and no accounts even though it was listed. He has also written a book which only seems to have been published on Linkedin. A pattern?

The idea is not a bad one - putting people with spare office space together with people who use flexible work space. However it seems this must be a very difficult fit as by his own admission the website and 'operatons' are still in Beta. Beta is now code for nothing's happening. It looks very much like an idea born of the internet which is simply not required or even possible. The website here is smart enough but is entirely hollow; despite those 2015 claims. Another pattern?

To give you some idea of the gap between Trevor's predictions and reality, we can share the company's 2015 Crowdcube projections. For their year 17/18 which is now well underway, they projected a turnover of £10.7m and a NP of £7.4m. Remember this is for a company that is now, still in Beta and pre revenue with no visible eCommerce platform. 

One point he did make in his response is that the company might move operations to Canada because of Brexit. When we asked him to expand on how moving to Canada would alleviate any of the implications of Brexit, he chose not to. Im still trying to figure that one out.

So this particular business had materially inaccurate finances and unfulfilled intentions - both birthmarks on the body Crowdcube. 

We would have liked to put his point of view. You will just have to make up your own minds.


Monday, 18 September 2017

A typical Crowdcube story

Are you comfortable, then we will begin, said the bwitch. Once upon a time people told the really they did.

Then they forgot how to. Now nobody seems to know what the word means anymore.

The Do Nation Enterprise funded via Crowdcube in 2014 - just £167k with SEIS. 

Their projections were not exactly accurate - were they guys?

Claims of large clients may have been exaggerated? Or maybe they were just unlucky. Dont suppose anyone checked.

The upshot is that for 2015 and 2016 the company has sustained substantial losses, when it claimed it would be making substantial profits. As at December 2016, it was technically insolvent. It recently raised £30k. 2017 projections seem somewhat optimistic.

Where in all of this is there any sustainable benefit to anyone in using SEIS. Please tell me or shoot me.

Of course this is not to belittle the voluntary not for profit work the company's NFP wing does. 

The Good the Bad and the downright Ugly

Three companies recent filings and reviews reflect the diverse nature of the Crowdcube portfolio.

First lets start with Clint - AKA Curpis Health and  also Go Henry

Curpis Health - It's a little early to be hanging out the bunting, but these guys appear to be ahead of their financial targets although they still appear to need to raise cash this year. Breaking into the NHS is a very had task, especially with the budgets stertched to breaking point but they seem to be getting there.

Go Henry - progess has been spot on and providing they can refuel their gas guzzling plan, they look set to make some serious impact in the future - when is anyone's guess. But certainly not a lemon. 

Then there is the Bad - well you can really take your pick. One we like Is Water to Go - seemingly gone or Psonar which has been liquidated.

We have reserved the Ugly for the worst set of reviews we have ever seen. This goes to Chupamobile - which took over £500k off Crowdcube punters. Here are some of the reviews - Sites vary on theor average but from the 3 we looked at, it's around 1.5 out of 5. - 

''Seriously folks, if you're reading this... They dont care. And if you doubt me at all, use your favorite search engine to find tons of other complaints just like mine. Don't fall victim to these guys. Avoid at all costs.''

''They are scammers do not use that website, dont buy or sell, if you paid for something that does not work please report here, choose internet fraud:''

''After buying a source code that was far older than stated, they continued to literally patronize me. Theyre customer service is one person, who refuses to offer any real help or refunds. They say they updated code, which they didnt. Made me waste even more time, only for them to tell me politely that I'm screwed. Now I have no product that i can work with, ive wasted two weeks in trying, and I'm insulted. DO NOT DO BUSINESS. I dont care how good it may sound. I wish I would have read the reviews on this company first.''

We are not saying these reviewers are right but as business is hard enough to get going, running into a headlong gale like this makes if pretty well impossible. Accounts due out this month.