Saturday, 24 February 2018

Time to take away the takeaway - Wrap it Up file more losses

Wrap it Up took £760k off 560 Crowdcube investors in 2015. Now two years on how have they performed against their Crowdcube offer?

Well you guessed it.Yet another hopeless failure. 

The Crowdcube version had profits for the year just filed (Dec 17) of £670k. The company actually made losses of £230k and since funding, has never made a bean despite claiming to be profit making on the pitch.

The pitch emphasises the new central kitchen which can service up to 100 outlets. Hell that is fantastic if you are using it but with only 17 outlets on their website some might say this a total waste of capex.

We shall have to wait and see what the outcome is - the company is complicated see here and there are new non related Wrap it Ups popping up  - so the brand is hardly valuable. Units that do exist and are run by this Wrap it Up, get very average reviews - not what investors might want in a growth company. 

The whole picture is very confusing. It does beggar belief that 560 investors could give away £760k for this at a dreamy £6.5m and not invest in a current pitch by Appetise, which offers value for money and a real chance of success. You have to wonder at the sophistication of this crowd. 

Thursday, 22 February 2018

Whatever happened to SilkFred's £100m IPO?

As alternative facts go, 2016 news in various papers, including The Telegraph, of SilkFred's £100m stock listing in 2017 is right up there.

In what reads like a company PRing, the news was splashed out in December 2016 just in time to pick up their Christmas sales.

More recently and we assume more realistically, the company have raised £7.5m on valuations of £20m and £25m. Considering what Crowdcube investors paid - even with dilution - they have seen the paper value increase. Just why the listing was postponed or cancelled isnt clear but there re many current factors in our economy that might make you think twice right now. 

We had this one down as a real success - please dont let us down. Accounts are late.

Tuesday, 20 February 2018

Myshowcase's final crash

Our recent report of the give away of Crowdcube funded MyShowcase to Miroma Group has now been confirmed. A communication from Crowdcube, who are the nominee account holders in this mess, states either agree to this or the business will close. And you have 4 days to take legal advice and decide. 

Investors in MyShowcase via Crowdcube will get 12.5% of the new Myshowcase, whereas they bought 13.7% via Crowdcube for £1m. These new shares have no rights. Miroma will get all the MyShowcase shares for nothing. Miroma have recently signed an agreement with Reach4Entertainmant in the US which may help the business.  

As usual, the poor investors that believed in Crowdcube, have been royally hung out to dry whilst Nancy and her cronies have been rescued from a sunken ship; at their expense. Whilst the communication goes on to say that this is unlikely to effect investors EIS reliefs - as the deal is at 'arms length', we feel these are rather short arms. Given the fact that the founding CEO of Miroma was a major investor in MyShowcase. In fact if you were really cynical you might think this was all a set up.

We know the FCA are hopeless but are they really that stupid?

Monday, 19 February 2018

What are Taylor St Baristas really up to. Maybe Harris and Hoole can give us a clue?

The power of fake news on the internet never ceases to amaze. Taylor St Baristas took £1.8m off Crowdcube investors in 2015 by way of a bond - for the sole purpose of rolling out new stores. 

Now they have told the Sunday Times, who wrote a piece on ecf bonds using our data, that they no longer wish to open units - they are coffee whole sellers. Well that is not what they sold punters when they issued the bond. It's completely the opposite.

One feature of the TSB's bond document was their repeated referall to the success of Harris and Hoole. Harris and Hoole was set up by the Tolleys in 2012 using Tesco funding. Its chain has now grown to over 50 but its profits are harder to find. In fact since 2012, it has made annual losses of £5.2m ,£12.8m, £25.5m and in 2016 17.7m. The Trolleys left in 2016 to concentrate on TSB and Tesco eventually got rid of the loss making headache to Cafe Nero in the same year. Including 2016, £61m has been thrown at this company and it has lost the lot. They have single handedly re written the definition of the word 'success'.

So is this the model that they based TSB on? Hope not. Of course in the TSB bond document none of these losses were mentioned - H&H was a massive success that meant the Tolleys knew that they were doing. Eh? The difficult bit is making a profit - any old fool can lose millions each year.

I do feel for the mugs who took the 'in store' bond offer in 2015, expecting a unit near them soon, so they could use their 12% annual freebie and indulge in what is, by many accounts, the best coffee around. With only 10 units open (just one more than in 2015) and very substantial losses, this 12% maybe annihilated by the added petrol costs in getting there. If it is so bloody good what went wrong?

Looks like the investors may have been trollied.

Saturday, 17 February 2018

Brexit funder Peter Hargreaves buys 33% of Crowdcube funded Powered Now.

In a move that massively dilutes Crowdcube shareholders, Peter Hargreaves has invested £2m into the SME invoicing and on line form company, Powered Now. 

Powered now had raised £1.1m on Crowdcube in two tranches in 2014 and 2015. In order to achieve this Hargreaves' investment, the company altered existing shareholders pre-emption rights by special resolution. That's why the dilution took place. 

Whilst Hargreaves may be castigated for his £3.2m funding of the Leave campaign in order to help him avoid the new EU tax avoidance directives, his involvement in any start up must be a massive plus. Powered Now certainly needed that boost.

The company recently filed accounts for YE Jun17 showing a £500k loss against a projected £1m profit in the 2014 projections. Having completely missed those 14 projections, the 2015 version had a loss for the same year of £347k; so much closer to the mark.

The company gets rave reviews for its service and products and now it has a very serious backer, we'd expect it to make good progress. It is just a shame that pre emeption rights which were clearly sold to investors have been tampered with. Mind you the company did really need the cash.   

Friday, 16 February 2018

Crowdcube's Tempus Energy do not disappoint with further large losses versus projected £6.5m net profit.

Maybe one day Tempus will supply some good news - but not yet. A £500k loss for YE June 17 has replaced their projected Crowdcube £6.5m profit. 

We wrote about them here

Tempus have excelled in missing their targets and they are certainly up for Crowdcube's worst performing success, ever.

Now they have a new team of directors (all the others resigned) and some cash. Large intangibles are holding up the mantle.

Good luck with this one. Not quite as Crowdcube described it back in 2015, when they took £650k off investors. 

Wednesday, 14 February 2018

Yet another Crowdcube Bond issuer fails.Taylor St Baristas files a £800k loss.

Hi - Hot from the Swamp today we have the Taylor St Baristas accounts. TSB used Crowdcube to raise £1.8m on a 4 year 8% bond. Target profits for YE Mar17 were just over £1m; generated by 20 coffee shops. The £800k loss has been generated by just 10.

Yet again we see the sort of ludicrous projections that Crowdcube promote on their platform coming to a sticky end. TSB now operates just one more unit than it did before it took the money off investors. Where did the £1.8m go? Who knows but.its gone.

So what? Investors are still getting their interest payments. Well yes for now they are. But with a BS at March 17 of minus £1.2m and no new funding since, it all looks a little stretched. The money is due back in 2019.

Investors can do nothing even if TSB collapse, as the bond was issued by a 100% subsidiary - Coffee Bond plc. Coffee Bond plc would eventually go bust but has no claim over the assets of TSB - as in the Square Pie fiasco. This no sense arrangement comes courtesy of the Crowdcube Primary 7 Bond Origami Group. Bless.

You would love their Bond Invitation Document  - this one was certainly Licensed to Thrill.

It all fits with our news breaking story of the Sqaure Pie failure, which was picked up by The Times today and the poor performance of both The Eden Project and River Cottage, whose bonds are due for repayment soon. Dont you just love the way Crowdcube sidestep the important issues and continue to produce a constant stream of PR sludge.

Swamp out.