Saturday, 9 April 2016

Crowdcube try to make excuses for Rebus failure


Crowdcube's blog now has this posted - a so called explanation by you know who - on Rebus

“As clarification, Rebus had two meetings with ReSolve in May 2014, a corporate finance advisory firm unrelated to Crowdcube, to discuss potential funding options prior to Rebus’ raise on Crowdcube, we were not aware of these meetings and it was not disclosed on the company’s pitch. However, it is normal for businesses to explore different funding options in their early stages, so Crowdcube would not have been surprised or alarmed by the ReSolve meetings. As many entrepreneurs and investors will appreciate, raising finance is difficult and not every conversation with an advisor or investor will result in an investment. Disclosing details of previous fundraising attempts is not standard practice even in traditional fundraising.”

Now there are various problems with this 'clarification' - if that is what it is.

Firstly it may not be general practice for 'fundraising attempts' to be disclosed - no one is looking for a published weekly list of them . However you can be sure that savvy professional investors, VCs and banks will have their ears wide open to the market where these attempts have to be made. So they would have known, as should Crowdcube. Crowdcube didnt know simply because they have no interest in their investors.

Secondly the wording they have used for these failed meetings is very different to the wording issued by the Administrator. He stated that Rebus was in financial difficulty - Crowdcube just say here that the meetings were run of the mill, to look at 'potential funding options'. The two are not compatible.

Given that the Administrator has no axe to grind and Crowdcube do, who are you going to believe? The proof seems glaringly obvious.

Interestingly the Chairman of Rebus made a telling comment when he said that the Administrators' 'interpretation' of events was not helpful.

It seems that the truth can be a right pain in the arse sometimes.

2 comments:

  1. Hi Rob
    I came across your website after reading an article on crowdfunding in the Times yesterday. Excellent reading with just the right level of humour attached to these crowdfunding failures.
    Have you thought about focussing your efforts at the beginning of a raise, I.e. Review a pitch at the start and give your opinion as to whether it's value for money or not?. I'm sure many of your readers would welcome your insight as many are unable to work out whether the PR they produce and the financial projections are based on fact or fantasy!
    Happy for you to post my question on your website to see what others think. Cheers

    Regards,
    Miracleman |

    ReplyDelete
    Replies
    1. Thanks for the comment. Yes I have thought about it and I often comment on current pitches especially if they are returnees. However I cant offer any 'advice' as such without the right authorisations and as I am now full time on the ECF Solutuions business so I simply dont have the time.

      Delete