Friday, 21 July 2017

What's in a word?

Black Bee are raising on Crowdcube. We wish they would be more honest; for the sake of the bees.

Im afraid this is something we go on about. Simply because Crowdcube continue to mislead their investors.

So, if you read this - 

Following the success of London Postcode Honey, the entrepreneurial duo has set up Black Bee Honey to offer a selection of raw, single origin British honey.

as the headline to a pitch trying to sell you shares for cash on a FCA regulated website, which only sells interests in commercial companies, how would you take the meaning of the word 'success'. We think it implies or even just means, financial success. Crowdcube is not a platform promoting social benefits, it is a pure investment for return operation - albeit not a very good one from the latter's perspective.

If you bother to check the facts behind this 'success' claim, then there is very little to shout about. Firstly there is no such company as London Postcode Honey - it was just their jar name. Put simply Barnes and Webb Ltd (aka LPH and the 2 founders of Black Bee's previous 'success') makes very little money - £3,000 in 2016. It seems to have very low activity levels. Nothing wrong with that per se but why dress it up as something else on a site that is supposed to be promoting only verified facts. Another CIC company they run has been closed with only dormant accounts. They have also used a different version of their names for this newco  - why? To find out about Barnes and Webb Ltd you have to dig around - not under the names given in the CC pitch. Based on this, they are valuing the newco at £750k. 

Isn't it time we had a fixed minimum standard for the information the platforms supply. So for example in this case, you cant use the word success unless there is something to prove it. And you must declare all your current and previous limited companies and other businesses with relevant details, so they can be easily traced at CH. Surely that's not too onerous for a website selling company equity for cash? Armed with the correct information, we can then decide if their past efforts were a success.

We love bees and spend a great of time making a home for them - that pic is in my garden. So people who also have the passion are good people - good people led down the wrong path by the platform no doubt. It just makes you look a little foolish and not very trustworthy. Which in the end will harm the bees. A shame.

Thursday, 20 July 2017

Not much to say about this really. Just more of the usual.

Crafty Nectar completes Crowdcube in 2 days with overdue accounts and an issue with their brand IP.

NOTE - Since publishing this, the company accounts have now been filed and the IP issue is, we are told, insignificant. Invest away if you believe the projected growth rates - which are so far completely unproven. IE 2016 revenues £40k (real) 2017 revenues projected at £80k(part real) then 2018 revenues over £350k. Also consider that the founders have only put in loans - £500 of equity and the invest £25 and get 25% off 'current boxes' seems to imply 25% off forever, which is crazy crazy.

Im sure it doesnt matter - very small company with overdue accounts. Nothing too worrying about that. You might think CC would want this to be in order before a live pitch is promoted on their platform but they probably didnt realise.

IP is maybe more of an issue. It only came up after a major competitor pointed out the possible problem when seeing the CC pitch. Subsequently, the founder has posted a vague explanation saying it wont change anything. But it is an issue.

Either a brand matters or it doesnt and this company seems to want it to matter. 

How could Crowdcube not have spotted this?

Why does the CEO not know about this and if he did, why did he try to conceal it. It doesnt inspire much confidence. Mind you, the pitch has already completed, so who cares.

More of the same.

Lovespace ups its game

Lovespace appears to have upped its game and has now crossed the 9/10 review line which for a consumer service, opens up the future for great things. We could only find two slightly negative reviews, both of which had been resolved, on the first five pages of Trust Pilot.

The company has come in for some criticism for its poor service levels but that now all seems to be in the past.

As one of Crowdcube's £2m plus raises (over 2 campaigns) this has to be good news for both.

Alongside this news, the company has just announced it has won a TV competition which will give them a free TV ad campaign as their prize.

Things have certainly turned a corner for Lovespace. Accounts out in September should reveal more.

Tuesday, 18 July 2017

Draper Esprit cover all exits

Draper Esprit are major investors in the Crowdcube platform. Now they are also investors in a Seedrs alumni Perkbox. 

Last year Perkbox ran a successful Seedrs campaign, raising a healthy £4.3m in equity finance through the platform. Nine months later they have secured backing for over $8m from Draper - an outfit that backed Crowdcube rather than Seedrs. 

As we all know Crowdcube and Seedrs are the two leading retail ECF platforms in the UK and are locked in to a winner takes all, rush to a massive ROI success. So this move by Esprit could just be because they see a great deal in Perkbox or it might have something to do with covering off their Crowdcube investment.

One thing is for sure. If Perkbox go on to become the next 'facebook' in investment terms, Esprit's help in getting them there is going to damage Crowdcube. 

Monday, 17 July 2017

Move along, move along, nothing to see here.

Ethos Global and its two founders are relaunching and rebranding before the old body is buried.

We received an invite today to the launch party for SOMA on 16th September - the new Ethos Global.

You may remember that Ethos was recently put into liquidation by the Courts for failing to return anything to CH. Apparently they are/were in dispute with their Cambridge studio landlords - a dispute that they or CC failed to declare, when they raised over £700k on Crowdcube in early 2016. 

Rumours abound about what might have happened but we can confirm that the Cambridge studio, which was the mainstay of the CC pitch and the business, closed very shortly after the CC campaign completed and then Ethos opened its London branch but used a different company. This company then became SOMA. 

According to more rumours the newco has taken all of the CC shareholders on board after Crowdcube, who had set this deal up using a nominee structure put them under pressure to sort out the mess. This is the company with the party.

Various questions arise.

The liquidation of Ethos Global, which took £700k off investors, has not started yet and nothing has been filed at CH except the Court Order. Clearly there have been some interesting goings on and it seems likely that someone is going to want to know the detail. Were there any o/s creditors for example, what money paid for the opening of the London studio and how did it legally change hands, how can the shareholders in Ethos be offered a deal ahead of secured and unsecured creditors? CC shareholders bought into a business with one successful unit but are now being offered shares in a company with the first unit due in two months. Is all of this legal? Was any of it planned? 

Anyone out there with any answers please get in touch.

Thursday, 13 July 2017

TableCrowd trying to make a miracle

TableCrowd are currently on Crowdcube trying to raise £400k. Its not working. But they have come up with a cunning solution. Fabricating a miracle.

In an email we have seen, the company is privately offering their most loyal customers a special exclusive deal - if they invest on the CC platform in the next 24 hours. Remember its only open to their regulars; or so they say

Invest around £400 and get six months free dining and invest over £600 and get a whole year free. 

Well, how that does offer to exclusive customers, stack up with the idea of open democratic investment? Clearly it must be a breach of Crowdcube's T&C; if they have any. Some investors are being offered a deal, way better than others  - privately off the platform. Maybe it's common CC practice and this is the first time we have been advised about it. In this instance the company actually tells recipients to keep the offer to themselves - thereby actively taking part in the deceit. 

We have also been informed that this is not exclusive to loyal diners. Its been sent to at least one person who has never used the service.

So what happens to CC investors who invest but have not been sent this email - it appears they dont get this special deal. Is that fraud?

A little sad and typical of the sort of stuff that goes on regularly on the Crowdcube platform. Time for a change? Certainly. 

Now you are really taking the P

The Telegraph or Crowdcube PR Dept, have come up with this nonsense from Luke Lang

Firstly the claim is that - 

The milestone comes after a number of businesses funded through the site have been sold, leading early investors to pocket huge gains.

'Massive gains'....'a number'.....? They say that Ecar Club made a 3 times gain for investors - we dont think that's true but even if it were, that makes two exits with modest gains and many failures and scandals - not mentioned of course.

Apparently, the Telegraph goes on, 17pc of investors have received a return so far. What the Telegraph fails to explain for some unknown reason, is that much if not most of this 'return' is made up of the CC bond issues - ie interest paid on the bonds, which are of course loans and nothing to do with equity investment. Which is what this article is about. The bonds get no mention anywhere. Neither do the overwhelming number of losses and scandals that Crowdcube have facilitated.

Mind you, as always with Luke, its not what he tells but what he leaves out that counts. He says that 17pc of investors have received a return. Now that implies that 17pc of investors are better off but it doesnt actually say that. You could be one of the 17pc that has received interest from the River Cottage bond for example and still be way down on all of your other CC equity investments. You would still have received a return. He does this regularly. 

Read the article, it is clearly about equity funding. Then do the maths. There is simple no way that the returns to equity investors makes up 17pc of the total number of investors who have thrown money at this platform. We havent run the figures but we'd expect that of that 17pc most if not nearly all is made up from bond holders returns. You decide if that's an honest way to put out your information. 

You have to ask why would one of the UK's most prestigious papers buy this obvious nonsense? Well you can only put it down to stupidity or ignorance or both. Its very damaging for the battle against AltFacts but the truth will out despite Luke's best efforts to conceal it. 

You can smell Crowdcube beginning to get a little desperate. We feel very sorry for the Chinese man who has apparently recently invested £1m in the company. Maybe an issue with the translation?