Wednesday, 2 March 2016

Ignore the hype GripIT is overpriced.

We found this from a large article in the Telegraph -

Grip It is now exporting to Germany and Belgium and a full European roll-out is planned for the end of the year, followed by an expansion into the US in 2015.
Grip It fixings are currently stocked in more than 1,400 stores.
The cash raised in the Den has been used to help Mr Daykin move out of his family's garage into dedicated premises. The investment will also be used for new machinery, and to ramp up production.
Revenues were forecast to hit £750,000 next year, but following his appearance on the Den, the figure is "likely to more than double," said the young entrepreneur.

Now the interesting thing is that this piece was written in August 2014.
So the progress promised has been just that, promised - not delivered. Revenues for the year in the final paragraph were in fact only £335k, making his final remark slightly ridiculous.
The hype on Crowdcube is understandable - that's what they do best. But dont be fooled, the valuation of £13.5m is based entirely on future contracts not yet signed for push sales overseas. These may or may not get signed and may or may not result in further pull through sales. The evidence from 2015 is that the pull through is sloooooooooow. 
There was no expansion in 2015 into the USA, that is earmarked for 2016 now. 
Be careful what you believe.

Later - 

Well it's two days since we posted this and the pitch has completed its £1.5m and is now in over funding. Guess we will just have to wait and see what happens. If it was such a great deal we wonder why Meaden decided not to invest in it herself this time? 

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