Sunday, 26 November 2017

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.

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.