Saturday, 27 February 2016
Idleman's lazy figures make for a Foresight Saga
Idleman, an on line cloths retailer, has a current pitch on Syndicate Room. We like Syndicate Room as they do try very hard to be open and up front about information.
Idleman raised a heap of cash in March 2015 on Crowdcube. Most of the raise was funded by the VC group Foresight and as usual on Crowdcube this was not made plain but it all came out in the end. Foresight are now backing Idleman again. Strangely this Crowdcube raise has now been removed from their list of successes, or at least we couldn't find it.
The real problem we have with Idleman is the constant use of lazy figures.
In the Crowdcube March 2015 pitch they stated -
''TheIdleMan is growing rapidly, with revenues increasing 70% month on month and totalling £235,585 for the last quarter.''
The 2015 revenue projection was £2.2m and based on the above stated growth rate this certainly looked achievable, given seasonal variations. The Crowdcube pitch duly successfully completed.
Now that the Idleman is back for more, we have the 2015 actual revenue figures - they took just over £600k in total. So a very long way from the £2.2m projected on Crowdcube. Either the statement above is simply wrong or something must have gone quite badly awry with the business model. You would have to say it is most certainly very misleading.
None of the above gets a mention in the new Syndicate Room pitch. According to the SR pitch sales for December 2015 were £200k, which makes the rest of the year a nightmare if you have access to the figures and the projections. Interestingly when asked about this, the CEO of Idleman said that they had new projections now, which appear on SR and that they had been using these for the last 9 months. Do the maths and this means they changed to the new projections just after they had completed on Crowdcube. QED you cannot believe a single thing you read on Crowdcube.
No one expects companies to be able to predict exactly what will occur 12 or 24 months out, these are simply guide lines. But if these guide lines are so far off track that they lead over the nearest cliff you have to question the ability of the company's management to create a profitable and sustainable entity.
We certainly would.
The need for a central reservoir where all of this information can be held independently of the platforms is an ever pressing issue.