Tuesday, 4 August 2015

Does this matter?

Is this a problem? An increasing number of pitches on the Crowdcube platform are looking certain to miss their target only to suddenly have a very last minute, large, single investment which takes them over the line. The latest case being Big Sofa.

There is no way to tell if this is a genuine investment or a member of the company filling the void to ensure all the other money comes in. In the case of Big Sofa, the company was on its last day when a single investor put in £240k of the £700k pitched for, which took them just over their target.

Linked to this is another development which is new. Pitches are finding that resistance to their optimistic valuations are forcing them to eventually re offer with a better percentage. So beware those companies that pitch with a fixed off platform deal already in place - eg Mara Seaweed. It is good that these businesses are seeing sense but wouldnt it be better if they came to the Crowd with a sensible offer in the first place. It just puts their business acumen in the spotlight.

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