Easy Property helped themselves to £1.35m on Crowdcube in 2014. Having lost over £17m in the last two years, we find them refinancing and announcing a new (to them) pricing strategy. The big Q is, will this put them top of the pile?
People we speak to say probably not - it will just extend their inevitable death. As you would expect the Crowdcube projections (does anyone read them?) showed the company making north of £10m in profits by the end of 2017. In reality they made a loss of £10m in the year to September 16.
The new pricing strategy is more about PR than anything substantial or groundbreaking. They now take a 'marketing' fee of £295 up front and only claim the sales fee of £595 if the property sells. In the words of their CEO they didnt like charging if properties did not sell. Do they really think calling a £295 fee by another name will fool the public?
I suppose they had to do something with the losses mounting.
The major player and the one everyone wants to beat is Purple Bricks. They reported losses for the YE Apr17 of £4.5m, under half the previous year and increased revenues by 151%. So Eprop have a long way to go and will need very deep pockets to overhaul the sector leader. The recent round at about £30m is a mere spit in the bucket.
Whatever happens, Crowdcube investors have no control and must hope that the roller coaster is built on solid foundations. These latest developments suggest they are firefighting which is never a good sign. The for sale sign may well go up, for the company, next time.