Saturday, 22 July 2017

Running on empty - what happened to Crowdcube's Franks Staks?

Franks Staks raised £83k on Crowdcube in 2015. It is closing under a VA. So what really happened?

The Crowdcube pitch was very upbeat and the company's products did have a placing in HN Knightsbridge - as far as we can tell. They made health supplements.

It has been treading water or drowning, ever since it raised the money, which considering what they told investors on CC's FCA licensed site, is a surprise.

Josh and David Franks, son and father, ran the show. They are described in the pitch headline as -

Josh & David Franks are a father-son combo. Josh is a qualified lawyer & David specialises in helping ambitious businesses achieve rapid & sustainable growth

Sounds good.

The pitch goes on - 

We are in discussion with or will approach Selfridges, John Lewis, Planet Organic, Ocado, NutriCentre, Wholefoods, Holland and Barrett, GNC, Equinox gym, KX gym, as well as franchise gyms e.g. Virgin, David Lloyd, Fitness First. Our connections at Virgin Startup are also looking to introduce us directly to Virgin Active, Ocado and John Lewis. We are also in advanced discussions with a leading chain of high-end London gyms. We also plan to partner with online retailers.
Seems none of this happened. This clip is taken from the 'Achievements to date' section of the pitch!

The unusual thing about this company is that whilst the shares were issued in October 2015 for the £83k, the YE June 2016 accounts show no record of any equity in the business except the standard £1. Losses for that year of £53k take the total losses to £75k or near enough the money raised on CC less the commission. CH here

It seems a little odd that a lawyer would not be able to issue an accurate BS for filing at CH - the one filed by Josh is clearly wrong.

As to the father's claim, well the evidence is there for us to see. If he cant run his own company, how can he advise others?

Of course none of the founders had put any money into the company. Well that is how it appears but as they didnt manage to record the CC investors, who the hell knows. You have to ask why the 101 CC investors didnt query the last accounts. 

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