Saturday, 16 July 2016

Another Crowdcube 'success' closes


Droplet raised over £500k on Crowdcube and has now closed


We are honestly finding it hard to keep up with the failures funded by the Crowdcube platform.

Droplet had a blog here before as they tried to raise more money on Crowdcube ealier this year but the pitch was suddenly pulled. So in 12 months they have burnt the cash and buggered off.

Isnt this becoming a little repetative?

Luke Lang, never short of a few words, stated on Droplet's failed 2016 raise - 

''Tech businesses, like Droplet, are always popular with our crowd of 245,000 members who have invested £45.5m in the sector, so it’s great to see the business return for a second round of funding on Crowdcube.”

He does love his large numbers.

Droplet's website has the following ambiguous explanation - 

“We started Droplet in 2011 with the hope of making payment simpler, friendlier and mobile-first – and more recently to allow merchants to offer better loyalty rewards to their customers. But sometimes things don’t work out. We always knew it would take significant investment to give Droplet the scale it would need to succeed. In spite of being well supported by our investors through thick and thin and having tens of thousands of customers and hundreds of paying merchants, we never got to the scale to make Droplet viable as a profit-making business.”

The 2015 raise had this in the pitch - 

Already more than 600 businesses have joined including coffee shops, hair salons, bars, restaurants, lunch venues and taxis. These businesses will soon be able to pay a monthly subscription to use the new loyalty product based on how many of their customers are collecting rewards.
Rather than using expensive advertising or a sales force, we market our products through ambassadors inside the communities Droplet helps support.
Droplet is registered with the Financial Conduct Authority for the issuing of Electronic Money. The the app averages 5★ in the App Store and has already has grown to 16,500 users.

Really?????

The financial projections used to sell the equity were as usual complete nonsense - even the actuals proved to be wrong. Maybe the FCA could start their new approach to ECF by looking hard at this case - it has all the hallmark errors you would expect from a Crowdcube raise. They might also like to check the way these iffy companies tart themselves around the platforms - this one appeared last month on Syndicate Room - http://fantasyequitycrowdfunding.blogspot.co.uk/2016/06/droplets-mirage-now-appears-on.html

Need any help boys you know where to find us

3 comments:

  1. You forgot to mention that Syndicate Room had just recently allowed this struggling company to try raising money on their platform... though it's difficult to find any trace of this now.

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    2. Yes we mentioned in the post we wrote here - http://fantasyequitycrowdfunding.blogspot.co.uk/2016/06/droplets-mirage-now-appears-on.html

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