FourEX raised £670k on Crowdcube in the summer of 2015.
(Note - some of the facts in this blog have been challenged - see comments. Annon is quite right on both scores but it makes little material difference to the post)
This was two and half times their original target and they said the money was to establish the first 10 of their foreign currency exchange machines.
So how have they got on?
Well you could say not too well. Their websites shows just 3 machines - two of which were already negotiated before the CC raise. the news section on the website has no news for 2016(see comments). The accounts filed recently show an odd picture compared to the projections on CC.
They have made a slightly larger loss than predicted but for CC projections these are almost a miracle. Whats odd is that the shareholder figure in the projections shows investment of £1.375m by September 2015 and the actual filed figure is only £670k ie the CC raise. So somewhere new predicted investment has vanished. In the pitch the company identifies the need to scale up and states that another £3m will be raised ( no ifs or buts) before the end of 2015. There is no filed record of this money (see comments). Which might explain the lack of units?
Technically the company is insolvent and only being held up by what CC showed as LT directors loans but which are now filed as current liabilities. In the CC projections this figure was £1.2m but the filed figure is only £570k. So between the missing equity and debt finance, the bottom line is £780k worse off than the Crowdcube projections showed.
That is one large hole. There is also the anomaly of the cash balance - over £800k in the bank according to Crowdcube but in reality just £51 in the real accounts. So where did £670k go?
450 investors put money into this company so if any of you read this blog and have news on this company - let us know. Of course all new companies are subject to delays in their role out etc but we think its time for claims about phantom future investments to be stopped. We see time and time again companies promising new money but then it never arrives. It seems to be a way of legitimately lying.
To be fair, they have 4 machines rolled out as there are two of them in Kings Cross(and they seem to be popular). But this is where the good news end.
ReplyDeleteIn their pitch they claimed the first machine would be installed in June 15, only few weeks after the crowdfunding. Took half a year longer than that.
They also claimed they had negotiated a contract with TfL to put machines into Canary Wharf which never happened, CC's out for lunch department must have missed this.
Then Crowdcube announced via their funded club in March that a machine would be put at London Bridge by the end of the month which, again, never happened.
Sloppy research, companies house shows they did issue further shares in October.
ReplyDeletePretty much at the same price though, not at a much higher price like they had 'predicted' on CC, and even though they had won the Pitch2Rich competition in the meantime.
Also the news section on their website has quite a few articles for 2016... nothing significant, but not sure where you were looking
I think that you should do a bit more homework before posting such article with absolutely no substances behind facts...just assumptions and speculations...
ReplyDeleteI am closely following this Startup given high potential of disruption of Bureau de Change and believe me I know what I am talking about.
Anyway, the company has raised 4M+ GBP to continue expansion and industrialise development...so not so sure they are short of cash as stated above...
As you might probably know (hopefully!), 99% of startups experience deviations from what has been planned vs. what has been achieved due to the nature of the business...so I am a bit surprised that you highlight that as a big Warning to potential investors/ followers.
Another wanabee blogger providing "google-based" fact on crowdfunding and trying to look smart !
Firstly if I was to take you seriously you would need a name.
DeleteSecondly I have had emails from real shareholders who feel that this blog on Coino is useful.
Thirdly the facts as published are undisputed.
Fourthly I do not believe you know what you are talking about.
I suppose to be helpful I should tackle your query more seriously.
ReplyDeleteWe all know that new businesses make projections and that these are not always met - your figure is nonsense but I get the message.
The problem we now have with equity crowdfunding is that some platforms encourage exaggerated sales forecasts? Why would they do that? Very simple, if pitches dont succeed, the platform doesnt get paid. If the sales forecasts are not sexy enough, the pitch doesnt complete. QED sexed up forecasts. The evidence is overwhelming - see this blog. Crowdcube are the worst at this - they have admin costs of over £6m PA to cover . See this blog. We need to get to place where this is curtailed - see this blog. Coino are just one of many examples of exactly this - see the post. They may go on to be a success but that's beside the point. The point of the post and of most of my posts, is that the platforms are abusing the system in order to drive their own revenues. It will end in tears - read this blog.
In their latest shareholder update they wrote that they are too busy running the business now, so they won't be sending any further updates and one should follow their progress on their website... oh boy
ReplyDelete