Thursday, 30 November 2017

Seedrs joins the failure party

Seedrs funded Ridelink runs out of cash and calls it a day - just 5 months after taking over £1m off investors.

Well if you cant beat them, then join them. As Crowdcube failures continue to pile up, Seedrs clearly had no intention of being left behind.

If you choose to believe anything you read or hear on an ECF platform, this company looked like a good bet. Geared up with £4m of investment and going places according to their CEO, Ridelink was 88%owned by Rocket Internet - an incubator based in Europe. The company had a trading record and tens of thousands of signed up customers. Mind you it had a turnover of just £90k for YE16, which must have raised some queries? In the campaign video, one poor guy actually set up a home based car rental business using Ridelink. He had bought 3 cars so will now be wondering how to pay for them. What could possibly go wrong?

Well we dont know yet - we asked Seedrs but they have not replied. In some correspondence from Ridelink they just say they have run out of money and are recommending people use Drivy instead. That sure is a novel closing gambit. In a face saving move, the email goes on to say that Ridelink is joining up with Drivy, which they say is great news for everyone.

Drivy acquired Buzzcar back in 2015 and is heavily backed by big money.

Hold on a moment - were there not investors in Ridelink involved here? Maybe Drivy are also sharing their company with them? And dont forget, the rewards promised by Ridelink to Seedrs investors. Good luck claiming those now.

We are not convinced that all the information made available to investors was accurate. There seems to be little sign of the £4m for example. Time will tell.

Finally we found this alarming but not uncommon note in the accounts for YE 16 - its second year. The directors paid themselves over £300k in the year with the largest single payment being £140k. This is astonishing for a start up making large losses and only in business because of other people's money. It should also be noted that neither 'founder' was a shareholder which would immediately ring loud alarm bells for us.  

Tuesday, 28 November 2017

Did Shaw Academy use Swagbucks to create massive 'client' surge just prior to Crowdcube campaign?

Crowdcube's withdrawn Shaw Academy campaign could have been using fake numbers to create investor interest. 

Well this one isnt a first but it is odd. Many companies use the coupon system to inflate their user numbers - Groupon Wowcher etc. 

But it appears that Shaw Academy where actually paying people 100 Swagbucks (worth around 50p) to sign up for courses, even if they never intended taking them. Of course then Shaw could claim that they had xxxx signed up members. 

Maybe this is why Crowdcube suddenly pulled the £2.2m successful pitch just days before it was due to complete.

Anyone at Crowdcube care to comment, apart from 'well its not our job to check'?

Here is what we were sent -

Monday, 27 November 2017

JAM Vehicles in midst reorganisation and refunding has lost first mover advantage.

JAM make the Jivr bike, an electric collapsible commuter bike. They raised money on Crowdcube in 2013 but have yet to deliver anything other than excuses.

JAM raised £160k on Crowdcube and then pre sold bikes to the tune of £120k on Kickstarter in 2015. Now after quite a rough ride through the KS forum, the company has admitted that they are not in position to deliver any bikes without a massive reorganisation and considerable new funding. Dilution awaits those bold enough to see this design as a classic back in 2013 - the same ones who failed to see the obvious flat tyre when it came to the business side.

JAM are not coming back to Crowdcube but have opted to go down the private Angel VC route using that they describe as a boutique bank. This seems a shame if they do not offer existing shareholders a deal. Class B SHs have no preemption rights - all the Crowdcube investors are B shareholders. They stated back in June that they were raising £2m. This we assume is the same £2m that they are about to raise now - or so they say. We dont know the valuation but suspect it will not be favourable to the Crowdcube SHs. They just have to suck it up, despite being the only reason that Jivr reached this stage.

Whilst all of this has been dribbling on, Jivr as a bike, has lost all of its first mover advantage and now faces considerable competition from existing market leaders. 

There are ways to attack a market with a new product and this certainly isnt one of them.

How the Crowd has no power in reality

The London Doctors Clinic raised over £800k on Crowdcube in 2016. They had already seen £1m invested by Oakfield Capital Partners, which gave them a controlling share in the company.

So when the company decided this year to raise another £2m, which had not been mentioned only a year ago in the Crowdcube campaign, investors had the right to vote on a 20% uplift clause.

According to Crowdcube's own site very few existing Crowdcube investors backed this change  - it might after all lose them 20% pro rata of any ROI should the company exit. It certainly has diluted their existing holding. Despite what appears to be an overwhelming NO, the raise went ahead and the company took in another £2m  - only £85k from Crowdcube investors. So much for the Crowd taking back power.

We dont know how the company is doing, as their accounts are now over 2 months overdue and they have a compulsory striking off filed against their name. It probably doesnt signify much apart from poor management. But then, that was why they raised the £2m - to improve the management side. It is just a shame they didnt tell anyone they were going to have to in 2016.

Sunday, 26 November 2017

Justpark look set to smash their Crowdcube target in latest round of funding.

Justpark raised over £3.5m on Crowdcube in 2015. Now they are back for another £1.5m, although we expect the real target is much higher. So how does it stack up?

If you listen to the company, then its all going swimmingly. So let's not do that.

In 2015, they only gave historic figures for the financials expect for that year. Now again they only give historic figures, so a comparison is difficult. However, we do have one and that is for 14/15.

Revenue figures are spot on but its the gross profit and COGS that send out a more worrying message. Not of course a message mentioned in the current pitch.

COGS were £263k but actual COGS for that year were £371k. So that's a 41% increase in COGS for the same value of revenue. Gross profit likewise were £828k but were in fact £626k again on the same revenue - a considerable shift in GPM. The overall expenditure was below the expected level and this seesm to be as a result of employing fewer staff. This might in turn explain the high number of complaints at that time that the company couldnt be reached if there was a problem.

Now we do know that the company has had issues with service levels and this could explain the changes - but this is not explained in the current pitch. When companies ignore the obvious in an attempt to disguise issues, you have be a little worried. 

Our main problem with Justpark, apart from the above is that they have no real control over the service they offer. The spaces are owned and controlled by the public - who are nothing if not unreliable. The issue of arriving at your space to find it either too tight, full or simply not there, with the owner unavailable, is one that appears too often in negative reviews. So if, for example, you cannot get parked you miss the wedding or funeral you planned to attend. To be fair the reviews have improved in the last year. But unlike Airbnb, the transaction value is very low so space owners do not really care. Justpark do compare themselves to Airbnb, which is a mistake. 

So you have to ask can the company resolve this issue - clearly no as they have no control over it. 

So can they live with it and increase their revenues by enough to make some money ie profit? Can they keep the GPM steady and stop the rise in COGS and operating costs above the level it currently sits at, against increases in revenues? That's the key balance and they have a long way to go to get to BE.  Deals with Local Authorities and major property owners such as hotel chains will help - but may come as a discount to GPM.

The rest is for you investors to decide. 

We team up with Syndicate Room The Due Diligence Guide for Investors - out now for free

Well here it is - the new and only guide for investors in the SME market, explaining how best to carry out Due Diligence before you part with your cash. Download it for free here

The guide, written by this blogger and updated on line as new information comes to light, is a very quick but comprehensive help to carrying out DD. If you dont bother with the DD, then you are a fool. And you are not helping anyone. In doing a good job on DD you can help the company you are interested in and that in turn that will be a help to UK plc. The last thing we need is a whole raft of useless companies soaking up the investment offered by ECF. Anyone familiar with this blog will be aware of that!

We have called many of the failures that we now see - when they were pitching for your cash. Read this guide and it will help you do the same. Filled with examples (anon but real cases) it's a quick overview reflecting 35 years of business experience alongside one the UK's best ECF platforms.

Friday, 24 November 2017

Scruples Free GF Foods Director declared bankrupt

This is a name worth remembering - Stuart Richard Allister - the CEO of the now defunct Crowdcube success GF Foods.

The administration is still ongoing. What has been revealed by the work to date (Sept 2017) is the directors had outstanding loan accounts and '' a number of payments that the directors have made/owed indicate the amount could be substantial'. And that the accounts were in such a poor state that it has been extremely difficult to work out exactly what is owed to whom and where the money has gone.

The administrator goes on to say that his investigations have unearthed a number of things that make him think there are grounds for claims against the directors of the company.

The CEO has been declared bankrupt.

Crowdcube allowed these guys to use their platform not just once but twice to con people out of £345k. This is only part of the estimated £1.8m in unpaid debts that GF have left the administrator to sort out. Well done boys.

We have written about them before here warning of their record of lies and deceit when it came to the claims they were making on the Crowdcube platform. Unfortunately for some, they didnt listen.

Thursday, 23 November 2017

Hats off to Grind

Grind's £750k Crowdcube completes in a day and goes into overdrive.

Grind appeared on Crowdcube in 2015 with a successful £1.3m bond. Whilst the projections then have not quite come to fruition now, they have certainly made progress. And the signing this week of SSP, the transport hub specialists, to help role out their branded Coffe bars in railway stations and airports, puts them them in a good position for the next few years.

Here is hoping that this is one company we can look back on and see how it was helped by ECF and made investors some money. Still a very long to go and using a 3 month run rate to state the revenue instead of much poorer real figures, aint great. But hell, its better than most. Expect more raises along the way.

Berrywhite launch downround on Crowdcube

Berrywhite took £293k off Crowdcube investors in 2014 at a value of £5m. Now they are back again for another £150k at a pre money value of £2.7m. 

Well at least that bit is open and honest. Oh wait, no it's not, we had to dig around to find that they had previously been on Crowdcube and at that value - its not mentioned in the pitch. Whats makes it worth £2.7m is highly questionable - it certainly is not the managements skills at sales projections!

So what else is not mentioned?

All the usual really - previous projections had the company making net profits of £1.675m for YE Dec16. They actually filed a loss of £220k. And so it goes on. Despite what they say in the current pitch, we hazard a guess that the 2016/17 turnover was around £600k when it was projected to be over £7m. So why would anyone believe anything they say?

Nothing really wrong with the product or the team. It's just that despite all the hype the former doesnt really sell very well. It would help if one could rely on the information they give out or have any confidence that Crowdcube bother to check it.

And do they think the 6p Sugar Tax is going to make that much difference? We dont. 

Wednesday, 22 November 2017

Crowdcube - watching a train wreck in slow motion.

We were sent this from Crowdcube's website - it pretty well sums up their value to the world...... We especially liked the references to this site as the place to find the real information!! Little Brew is still not closed. In light of the very recent Shaw Academy fiasco, we wonder if Crowdcube are now employing the sons and daughters of their interns.

From the CC discussion board about Little Brew...


EIS loss relief

lalsarin 3 months ago
9 Replies
In the investor update in March 2016, Stu sadly confirmed that he was selling all of the brewing kit and would be evaluating the future of the business. A decision about this was to be made "several months". I have respectfully stayed silent waiting for a future announcement.
However, I have heard nothing in the last 16+ months. I do note that the company's accounts are over one year overdue. Can Stu either confirm that the company is to be wound up - which would allow loyal investors to claim loss relief from HMRC - or put out his plan of what is happening with the business?
While I am sympathetic to the struggles of the business and the stress that this brings, leaving this in limbo has simply mean that no one is able to move on. Investors have entrusted Stu with their money, and without his action cannot claim the loss relief that we are due. Please can we have a response asap.
0 days left
FYI, my emails to Stu have bounced and seem to be not in service. Perhaps Crowdcube staff could comment on this please?
For any other investors interested, Crowdcube are investigating. They are going to contact Stu and find it it where things stand. I'll update when I hear more.
Any news?
I see that the compulsory strike-offs at Companies House were suspended in May 2017. If there is still some value to be had here, then let's hear about it
A bit of communication and corporate governance wouldn't go amiss
In a nutshell:
I emailed Crowdcube saying that the website and Stu's email were down. They replied saying that because the website and email were down, they couldn't get hold of him....
I then replied suggesting that they tried another method of communication, such as phoning him (surely they have his number?!), writing to him (his address is listed on companies house) or through social media (he has a LinkedIn account).
On 15 September Crowdcube replied saying that they have tried multiple methods of communication in the past but will try again. I have heard nothing back and have low confidence that CC will hear back or help investors by forcing through a wind-up or agreement of zero value with HMRC. Other crowdfunding models, with other investor structures, would be much more active in this.
Options for us now are:
  1. Do nothing and wait.
  2. Try to contact Stu directly. I will have a go at this when I come to do my tax return later in the year.
  3. Agree with HMRC that the shares have negligible value, as allowed in EIS rules, and claim the loss relief.
Thanks for your efforts. If you do manage to track him down, please let us know as he may be more prepared to 'engage' if he is contacted by a number of shareholders.
I quite agree re other crowdfunding models. I have stopped actively investing on here as the lack of portfolio management, communication and general corporate governance is too frustrating. Caveat emptor!
Mtmale, I'm exactly the same - I've stopped investing on this platform all together after a corporate governance disaster here ended in a successful criminal prosecution... I thought that was a bad once off, but then I started reading Rob Murray Brown's blog about this site...
Same here. Quantock Breweries is also an interesting case...
From a past experience where I had an unlisted investment that went wrong, with a complete lack of information, I claimed for it to be of negligible value by briefly explaining the circumstances on my tax return and it went through fine. Bear in mind that if any future value arises (albeit unlikely) this then has to be declared to them.
Interesting. Thanks Jimbob. Just a shame that Stu appears to have given up without wrapping up.

Shaw Academy's Crowdcube pitch is cancelled at the last minute

In what looks like a farce, even for Crowdcube, the succesful Shaw Academy ECF campaign which had raised over £2m on Crowdcube, has been pulled by the platform.

Apparently Shaw's were in breach of the Crowdcube rules. Are there any? How often have Crowdcube been in blatant breach of the FCA rules? Well there are over 800 posts here. For Crowdcube to give up the commission on a £2.2m success, when they are so desperate for cash, this must have been one mighty breach. Shaws say they have done nothing wrong. Well they cant both be right.

Shaws appears to be a highly successful, well established, on line educator. We wrote about them as we thought the reason for their Crowdcube success was entirely due to their rewards system. Nothing wrong with that  - its just clever marketing.

Shaws for their part tell a different tale - they found Crowdcube very difficult to work with - join the club. 

All in all it's a very embarrassing episode - to cancel a highly successful campaign at the last moment - why wasnt it pulled earlier? As with all things Crowdcube we will never know the true story because they are so open and honest. It's kick it under the carpet time. Shame, as this month has been the best one Crowdcube have ever had. They are still a long way off the required monthly completion rate to BE but it was progress from the depths of despair in September and October. 

Tuesday, 21 November 2017

Two Crowdcube old boys return for more please

For this one you have to imagine you are in the Land of Nod, where all reason has been suspended. Then when you see two Crowdcube companies failing to get close to their targets, raising their valuations and hooking more suckers, you wont get a shock.

Po-Zu make shoes and Raw Halo make chocolate. Both have also made history in failing to get anywhere near to their projections when on Crowdcube last and then coming back with an increased valuation, based on Nod times Nod equals Nods.

Oh no........hold on............. that's what all Crowdcube funded companies do. 

Well good luck to you both - you clearly have an excellent scheme(typo?) going and people believe in you, even though you dont deliver. Of course, none of this is apparent in the current pitches where its all we grew by Mountains of Moria percent and acquired a Monty Don of new customers.

Monday, 20 November 2017

Crowd2fund raising £1m of £10m round via the Crowd

Crowd2fund are tryin to raise £1m of a £10m round to finance growth of their P2P platform.

The company were reluctantly in the news earlier when this article appeared in the Guardian -claiming that there was something not quite right with funding it had received form a off shore company in which the CEO's brother, the MP Matt Hancock was involved. Matt Hancock is a name most of you should remember as he was involved in setting up the lack of regulations for ECF. 

All that aside, there are other oddities about this outfit.

The two main guys running the company are Chris Hancock - Matt's brother and David Robson. Now we cant find any evidence that these two have a clue what they are doing. Robson makes the claim on the site that he has successfully exited his toy company Ukick. But there is no evidence for this and he is still the only shareholder. Ukick is tiny and has never made a penny. 

Hancock comes with even less experience claiming he was CEO Nyble Communications. This company has gone from nowhere to nowhere in 7 years and was at the last accounts insolvent. Prior to that he was with HSBC. SHhhhhh.

So you have to ask the Q - how does a platform in the ECF/P2P sector with no track record, run by people with no track record, get an FCA licence. It probably has nothing to do with Matt Hancock's position as Minister for State for Skills and Enterprise in 2013.

Looking through the Crowd2fund site, nearly all of the funding is loans based. We counted 3 equity campaigns. All but one of the of the deals are for very small amounts - £25k to £80k. 

Claims made by David Robson need some scrutiny. The platform is authorised to use Innovative Finance ISAS - which it claims has raised the level of funds channelled through the platform by 3900% yoy in the Q1 of 2017 - here  . Which is certainly very impressive. Mind you, depends where you start from.

Accounts for Crowd2fund to February 2016 show little or no activity so the IFISAS are certainly proving a game changer. We couldnt find any of these recent deals on the website - maybe they are just too busy dealing, with no time to update? David claims that the platform has enabled tens of millions of pounds to flow to companies and stated that in August they expected IFISAS to originate £10m of loans. We couldnt see those on the site.

At a time when ECF and P2P needs to be moving away from the appalling mess the likes of Crowdcube have made of it, we really just hope these guys know more than their CVs suggest. 

Oh nearly forgot - if you feel like buying in, the platform has been valued by some lunatics at £33m.

Pavegen energy creation is pure myth

Pavegen raised just short of £2m on Crowdcube based on its slabs producing energy when walked on. Now their installation in Washington DC shows these claims are at best fanciful.

We have written extensively about this company - here

Thanks to a friendly reader, we now have a better understanding of what these tiles are capable of - backed up by this article here

Not a lot.

The company claimed when it installed the Washington site that the 3 stripes of tiles would produce 0.07 KWH each day. The actual energy they produce taken from the best day they have had is 0.03 KWH. Hmmmm. This equates to an annual income of around £2 for the whole site.

This installation cost the US taxpayer $300,000. So I suppose full marks should go to Pavegen for putting one over on them.  

The energy counter they set up with the Washington installation is broken so today's reading isnt available. It has been broken before but we dont know who is supposed to be in charge of it. Probably best for all involved that the real figures are not available.

If you want to have a real laugh, watch their video of the AGM. Hilarious.

Could Crowdproperty be the real deal?

Crowdproperty has just raised £600k on Seedrs in 2 days. They are now overfunding.

Crowdproperty allow you to invest short term in property development, securing your cash against the property. Investors gain a good rate of interest and have so far seen little of the risk. You get to choose the properties that you want to invest in. 

We first came across Crowdproperty when they raised a small sum on a very dodgy ECF site Bnktothefuture. It was probably their presence on this site that put us off - the site now deals from Honk Kong where the founder has made a fortune in Bitcoin.

What we now like about Crowdproperty is that they have tried and tested their model for several years on a small budget. They have had no defaults in all this time and returned investors 8% pa. This suggests that the founders are in this for real not just for a quick hit and flashy cars.

Scaling up the model may lead to a watering down of the exacting due diligence that they have to do to achieve zero defaults, but it might just be that this is a real ECF success in the making. 

As a caveat we wrote some less than complimentary posts about them here so do your own DD.

Bring out your dead - another Crowdcube success implodes

Twenty Something London has gone. Long live Twenty Something. What a waste of £156k of Crowdcube investors' cash.

We called this one - yet another one - only a few days ago....... here. Lasted almost 2 years, no accounts since the end of 2015. Suppose the the founder just spent the cash and wondered off to waste someonelses. Just in case you come across him, he is John Michael Sookias.

Plenty more queuing up to join the pyre. 

Sunday, 19 November 2017

Has Hybrid Air's balloon finally burst?

For once we can use a real photo - this is how Airlander ended its Saturday.

We have posted quite a few articles on Hybrid Air and its attempt to create the world's largest 'aircraft' here. As with anything of this scale, it has had its ups and downs!

Now at a time when the thing is supposed to be nearing its final stages, it appears to have collapsed. The thing wasnt flying at the time and according to the company, it slipped its moorings and the automatic safety device cut in and deflated the helium filed airship before it disappeared. 

Maybe they could patent this device for dog walkers -

Fenton...Fenton....FENTON!!!!..........Whoosh...... Good Boy Fenton. 

Expect a new funding round or two as they will surely take a big hit from this. Crowdcube investors have already thrown £4.22m at this project and were told by the management to suck up a down round (£0.60 from £1.40 per share) recently, so they might need to find a new tree to shake. 

Thursday, 16 November 2017

One Rebel raise £4.8m causing Crowdcube investors considerable dilution

One Rebel - a company trying to set up a chain of health and fitness studios, has saved itself in the short term with an injection £4.8m of equity capital. At a valuation of around £11m, this round is well below the Crowdcube valuation from 2015. 

One Rebel has taken £4.5m off Crowdcube investors to date in two separate rounds, in 2014 and 2015. They have never come close to any of their projections or planned openings. 

Apart from this being a down round, the dilution that Crowdcube shareholders will endure will not be much of a Christmas Gift.

This sector has been swimming in cash recently with Piper backing the Frame studios (2 currently) with £6m. 

Yet another Crowdcube success blows up

Universal Fuels took £50k off Crowdcube investors in 2012. Now it has gone into Administration owing creditors over £600k with little hope of paying any of it off.

We just tell the facts - we dont make them up. 

This company, which we warned investors about during their pitch in 2012, has run up large debts. It may not have taken much off the 2012 investors but it has off trade creditors. 

When the administrator looked into selling off the company assets, they found the company in a bit of mess, with worthless contaminated oil and false debtor lists.

So as we have been saying all along, Crowdcube are, by helping this type of outfit fund, helping to ruin UKplc. How many other companies will be forced into administration because of these bad debts and how many laid off staff will suffer depression and soak up NHS funds, we may never know.

One thing we all know, Crowdcube are responsible despite their lawyer's claim that nothing is their fault. Without Crowdcube and the fake financials their platform promotes, this company would not have been able to rip off £600k worth of creditors. 

Wednesday, 15 November 2017

Rentify finally file accounts showing they are blushed with 'success'

Rentify helped themselves to £1.3m on Crowdcube, at a valuation of around £20m, last year. Their latest accounts to YE DEC16, filed late, have them technically insolvent with a large hole where projected further investment was promised.

We read recently that this blog is primarily for bashing Crowdcube. Well that only tells part of the story. All we do is follow the pitches that fund on Crowdcube - the news here is only 'bashing' because those are the real results these companies are producing. Unlike some others, we dont manipulate the numbers.

Back to Rentify. They made a £2m loss for the year, which is in fact better than the projected £3m loss. However the problem starts when you look at their funding. The £6m of new equity investments shown as coming in 2016 has not appeared and the company has so far in 2017 managed to raise not a penny.

We have warned about this type of thing on numerous occasions. Promises of future large funding events are more often than not a smoke screen for something well worth avoiding. The future of any business is entirely reliant on its liquidity. Rentify dont have any. The company has lost 4 of its Directors this year - another big red sign to stay away. One of them was Simon Grice who founded Ineed - another failed Crowdcube company.

Rentify is backed by Balderton Capital, one of Crowdcube's main backers. Any patterns appearing? Maybe they will shake their money tree once again.

Crowdcube's handling of Ethos Global Fiasco is a disgrace

Crowdcube have hung their Ethos Global investors out to dry with a deal that benefits nobody apart from the founders.

Crowdcube investors put over £700k into Ethos Global - a Cambridge based yoga studio. Now Ethos is being liquidated, the founders have come up with a cunning plan. They set up Soma London England, to run the new London studio. This new studio was paid for and opened by Ethos. The liquidator has yet to rule on this sleight of hand but Crowdcube seem to have accepted it. Ethos owed over £7m, around £6m of which was shareholder capital. Their only assets were in London.

In the original CC pitch, Ethos sold 15% for the £700k, valuing itself at around £4m pre money. Now shareholders have been offered a take it or leave it deal by Crowdcube and Ethos - shares in Soma to replace those of the liquidated Ethos company. The deal is only open for a short time to pressure investors. They are offering 7% of Soma, a company with little trading history, no accounts, no capital and a potential court case hanging over it's founders, in place of the 15% they owned in Ethos. So Crowdcube have agreed with the founders that Soma is worth over £8m. Sure.

The deal is, you either accept this total nonsense or you get nothing. Meanwhile the founders walk off with the assets paid for by Crowdcube investors. As the shares are held in a Crowdcube nominee account - they owe a duty of care to act on behalf of their clients - the investors. Well the investors are not paying them anything but are Soma?

In the email from Dr Theo, one of the founders, he talks glibly of raising £200k in the next few days and then raising VC money next year. What is he smoking? Why would any sane investor give him a penny?

We would be amazed if the founders are not handed out a banning order by HMRC and also bemused if something isn't done by the FCA about Crowdcube's part in all of this. The reason that Ethos failed was because their Cambridge landlord was owed a large sum by the company and put them into liquidation. A sum that at least in part we estimate, dated back to before the Crowdcube pitch but which was not revealed to investors in the pitch. Essentially the company never had a pray.

Hung out to dry with brass knobs on.

Tuesday, 14 November 2017

Has Crowdcube's Oval Sound gone pear shaped?

Oval Sound were on Crowdcube trying to raise £500k. The campaign is (was) a disaster with only £5k invested (a CC term)  and has now vanished, with 16 days on the clock.

See here -

This may or may not have something to do with the fact that Oval raised a whole load cash on Kickstarter and have yet to deliver anything to most of its supporters. The KS page makes for interesting reading. Here is one from 3 November - excuse the language!

Bunch of thieves can’t even deliver after two years their promise useless company and crowd founding again your having a fxxcking laugh hope it flops and that you end up bankrupt useless useless

Whatever, the Crowdcube campaign is now in private mode, although its not private due to some glitch within the CC system.

I suppose with the laughable attempts to sort out Brexit, we shouldnt really be surprised that we get ourselves in such muddles. This is yet another Crowdcube farce. A transparent one. 

Twenty Something London appears to be nothing

Twenty Somthing London raised £156k on Crowdcube two years ago. A donkey in a boat would have been a better bet.

It's timely that just as we launch our DD guide with Syndicate Room here, yet another Crowdcube disaster is sinking or is sunk. 

TSL have failed to file accounts due in June 17 and are now 2 months into a compulsory strike off - hell they cant even close in an orderly fashion. 

They are one in a growing number of late filers but we feel given the inaction to stop the GAZ1, the lack of any filings for 12 months and a FB page with no posts for over a year, this one is a goner. 

Question is, can donkeys swim?

Crowdcube Success Doorsteps are totally clueless

There is something very odd about the recent raise by Doorsteps - the online estate agent run by a teenager.

Firstly, when the pitch was live, the founders made a big deal of a potential very large investor coming on board. Such was the importance and likelihood of this, that the platform allowed the pitch, which was already over funded to 140%, to extend its campaign.

So the original target was £400k. The pitch got to over £550k and then the extension opened. 

If you check the pitch on Crowdcube, they finished at £395k. 

So under the original £400k and well off the £550k plus they appeared to have hit. Where was the large investor? Fictional? What happened to the extra £150k? And what happened to the rule that if you dont get to your total, you get nout?

This was all happening back in August 2017.

Now on the 14 November, the filings show little or no evidence that Doorsteps or Upside Capital Ltd, has raised much at all.

A SH01 filing dated 6 November, states that the company allotted 495 shares for £1 each. IE they gained £495 in cash from investors. It also states that the total allotted at this date (6 Nov 2017) is 12m. There is only one class and they are A shares. So CC shareholders bought 0.0000412% of the company for £495. That certainly isnt the deal Crowdcube are promoting.

You may remember we had the same problem with Vita Mojo recently - see here. How many more filings have been hopelessly misfiled by Crowdcube since 2011??

There is more.

The company's filed Confirmation statement made to June 7 2017, shows the total allotted shares as 100. So how it became 12m only a few months later with no new filings in between is a mystery.

Obviously all of these filings are total make believe. But they need correcting or CC shareholders who thought they were buying real shares in Doorsteps will end up with dust. It's evident that Crowdcube interns 'helped' Doorsteps create this fantasy. 

It really is not difficult to get all of this right. But it does seem it is beyond Crowdcube. And what does it say about a company's abilities that they cant get something as simple as a filing correct. 

Friday, 10 November 2017

Red Advertising aka Recruitive Software file yet more heavy losses

The Old Dog and Crowdcube legend, Red Advertising, has filed accounts to YE May 2017 with another heavy loss of £300k - giving it a running loss total of £2.3m. 

You have to applaud the sheer determination of the founder but still wonder whether investors would not rather wipe the slate the clean and get on with claiming their loss relief. Their Crowdcube projections had them making over £2m and that was last year. 

Red have raised capital on Crowdcube numerous times, each time with tales of greatness and forbidden fruits. Yet they still keep filing losses. They have been technically insolvent for around a year and even the latest small raise in July wont change that. In their 5 years, they have covered this blog with numerous entries, seen a few name changes, oiled a steadily revolving Directors' door and held a plethora of Crowdcube Awards. 

They started with Crowdcube in 2012 and completed their 4th success in 2014, totalling around £1m. Since then even Crowdcube punters have lost interest and they have sought funding overseas. 

Who knows, they might even make it. It would certainly be one worth writing up if they do. 

Our call back in 2012 was stay clear.   

Wednesday, 8 November 2017

Ethos Global Liquidation is as much of mess as Ethos itself

Liquidators in Ethos Global pile up seem to be out of their depth. Crowdcube shareholders have been left out of pocket with the lights off.

Ethos Global is one Crowdcube's worst scandals. Around £800k was invested via the platform, spent by the company before the company was closed down via a compulsory liquidation. The money spent went to open a new facility which is now run by the same people under a new name.

Documents we have seen state that Ethos has a called and paid share capital of  £6,885,526 and had overall liabilities of £7,864,430. These are from the official receivers office. 

We cant find any documents to support this level of equity invested in the business. Including the Crowdcube fiasco, we estimate that no more than £3m was invested into the company's share capital. And to be frank we doubt the documents filed by the company have any veracity.

In the same documents, it states that the Ethos' founders had given a figure of £50k for the company assets. Now given that most of the £800k Crowdcube cash went into opening a new yoga centre in London, this seems very small. Of course we all know that the founder has moved ownership of this new club to his newco Soma London England. A move that by itself should be earning him some jail time. 

What is yet to be fully explained is why Crowdcube allowed this company, who were already in dispute with their Cambridge studio landlords before the Crowdcube campaign, to get anywhere near to investors. Cambridge, billed in the pitch as the cash cow for the business, closed shortly after the Crowdcube campaign succeeded. 

And guess who pulled the plug on the company. Yup  - the Cambridge studio landlords took this to court and had the company closed down. 

The founders have promised Crowdcube shareholders new shares in Soma, now the operating name given to the London studio. But nothing has happened. Shareholders we have spoken to have had no advice from Crowdcube or the company and have come to us for help. The liquidator has been on the case since July and has achieved nothing.

That is simply wrong. 

Crowdcube interns do their best to screw up new Monzo investment round

Just as we thought that the Crowdcube interns couldnt get any worse - we have seen evidence that they have (in the words of a Monzo employee) - 

'Crowdcube were incorrectly calculating allocations which should now be fixed — for anyone who receives an invite from now on. For those who already received them, you should receive a correction email. Sorry!'

Reading the string, its clear that shareholders had already worked out that Crowdcube cannot do the math  - and they were right.This shouldnt be a complicated piece of arithmetic for a platform sanctioned by the FCA to do exactly this sort of calculation. But guess it is too complicated for Crowdcube. What a  bunch.

Also in this string on the Monzo site, Monzo intimate that they are about to find a way to sideline Crowdcube and do a Brewdog 'raise your own' in 2018. Cant say I blame them. Dilution for those not taking up their allocation now is suggested at 24.5%. 

Friday, 3 November 2017

It is time for real people power to make a difference. Get in touch with us if you have a story about Crowdcube

We cant ignore this any longer. The latest 'mistake' by a Crowdcube success when they gave SHs only a tenth of the shares they had bought; signals time for action. Things must change.

As we wrote in a recent post on Vita Mojo, the company had filed its SH01 using completely fictitious numbers and giving Crowdcube shareholders a fraction of the shares they had paid for. No one had spotted this error until we did.

That has to be wrong.

Why were Crowdcube not checking these things - the company has filed several incorrect documents at CH. 

So if you are an investor or someone who has a story about Crowdcube  - good or bad - then please get in touch. We know from comments on the blog that Crowdcube's own staff are unbelieving in the company's incompetence. Its time to get this all out there - to stop the mass of fake PR they continue to promote and to show them up for what they are. Maybe it will help them change? 

We will verify the facts and you will remain anon if you wish to be. All allegations will be put to Crowdcube before publishing.

We look forward to hearing from you. 

Thursday, 2 November 2017

Is Lickalix melting?

Licklix raised £235k on Crowdcube in 2015. Accounts for YE January 2017 show zero cash and large losses. Crowdcube projections showed £1.2m revenues and £280k NP

It looks like yet another example of Crowdcube's highly exaggerated projections and a business plan fit only for the bin. They havent closed yet which is a surprise given the CA position in January, so maybe they have turned it around.  

More real evidence that the Crowdcube platform does not work

It's like we have been saying - Crowdcube pitches are worth sh1t. Atlantic Kitchen have a current year revenue of £85k - 3 whole years after raising finance on Crowdcube with revenues in 2014 of £180k.

Atlantic Kitchen is nothing more than a bored housewife's hobby business. We told you all this on several occasions on this blog.

Now the owner and her husband are off to spend sometime in the US - to help expand his business. What the hell happened to the seaweed?

It's risible that we allow this sort of nonsense to even pitch on a ECF platform let alone persuade punters with fictional figures. The revenue for 2017 was supposed to be just under £1m and instead it's £85k. A corner shop selling ice creams on Sundays only takes in more than that.

The cherry on the cake is the delisting from Sainsburys and Ocado - where the former's buyer thought that seaweed hadnt quite found its market yet.

As one angry investor put it - 

I'd like some of these guys to pull their fingers out and wind up so I can put them in this years tax filing and stop getting their yearly updates...

Amen to that.

Wednesday, 1 November 2017

Crowdcube success Ongallery needs switching Off

Ongallery raised £320k on Crowdcube in January 2016. Their latest accounts for YE February 2017 show they are insolvent. So where is the cash?

For a small company, £320,000 is a good sum a money to play with. You would expect to see something on the balance sheet to reflect its going. Sadly in this instance Crowdcube shareholders in Ongallery can see nothing.

We did warn you all when the pitch was live -

Fixed assets of £23k are lower than 2016 and current assets at £67k are no way sufficient to cover the current liabilities of £146k. Hence the red hue.

So in just over 12 months, the owner of Ongallery has managed to get through all of the Crowdcube money and some more besides. Apparently they have raised over £600k in equity funding. As the accounts are micros its not possible to verify the pitch claims.

Sir John Hegarty, the big name who lent himself to the Crowdcube campaign, has resigned. Their website is still live which is something positive  - but that was created before the money came in.

The Crowdcube pitch is full of the usual krap about how they will drive significant EBITDA etc etc. You need a licence to drive but unfortunately any idiot can start a business.

Apparently the CEO had extensive experience in start ups so maybe with this one, he was just unlucky. We'd still like to know where the cash is.

Pull the switch when you leave.