Wednesday, 25 March 2015
When is a fact just a misdirection?
A current pitch on Crowdcube is illustrative of the sort of information manipulation the platform allows or maybe even encourages.
RaterAgent is trying to raise £75,000. The founder is Mal McCallion. Mal, the pitch tells us up front, was involved in the launches of Zoopla and Primelocation. Wow you go, then this guy is really something. If you look at his Linkedin entry, he was a big cheese in both. He also helped turn around a business called Propertyfinder Publishing - he was their MD. What you would a call a very solid record for someone offering to sell you equity in his next property based venture.
From records Mal has never been a registered Director of any trading companies. He currently holds three directorships but none of them active. He was never in the the executive management of Zoopla or Primelocation. Propertyfinder Publishing doesnt exist although the Zoopla Group own Propertyfinder Publications, which is and has always been dormant.
So from being some Billy Whizz who has powers not ordinary man could have in the property world, Mal is in fact just an ordinary guy who may have worked for Zoopla and Primelocation. We checked with Fastcrop, who founded Primelocation and then sold it onto DMGT in 2005 and there is no record of Mal having any significant role. His claim therefore in the pitch to be a veteran of the startup Primelocation is just not true.
So RaterAgent, a company that has only traded in beta, is now valuing itself at just over £1m (£75k for 7%). This valuation is based largely on the credentials of the founder; credentials which do not stand up to the briefest of checks.
Rateragent's strapline is 'Where transparency is key'. If it wasnt so serious, it would make a great joke.
So much for Crowdcube's due diligence. Maybe if the platform spent a little less time on their own PR and a little more on checking facts, we might see some pitches that used facts and not fiction to sell investors equity.