You will love this one.
For ages now the secret amount that ABInv paid for Camden Brewery has been kept very secret.
But now we know what that amount was - from the horses mouth.
£85m is the given figure - verified by the fact that its included within a current Crowdcube pitch so would have been vetted by Corwdcube's OTL department.
So that's a ROI of well under 2 times. This was described by Luke Lang of Crowdcube at the time, as a return of multiple times. PR being his main thing rather than numbers.
Not surprising given the ludicrously high valuations of companies raising through Crowdcube.
ReplyDeleteSelling a company for £85m is an unbelievable achievement, better than 99.9% of business owners will ever do. And better than 99.9999999% of people on earth will ever do (although most of them don't aspire to that!).
ReplyDeleteHave you sold many companies for £85m+?
Most startups fail, a return of anything within 1 year is a huge success. A lot of the crap on Crowdcube is utter drivel, but sneering at a huge success because it doesn't quite correspond with the boasts of the Crowdcube CEO just seems bitter.
You are poorly informed Chis. If a company is valued at £45m and raises substantial capital promising multiple returns but delivers returns of well under 2X almost immediately after the capital injection,as is the reality in this case, then that transaction is a failure. Check out the facts - this wasnt a start up, it was a substantial company with a good trading record since 2009. The post is about the relative value this investment offered - relative to the promises and relative to the post exit claims by CC. It helps to know a little about what you talking about.
ReplyDeleteOk then, what other investments can non-accredited investors make that allow them to get an 88% ROI in 8 months?
DeleteIt is rather naïve to think/believe that Equity Crowdfunding (ECF) will give regular people access to VC/PE-like returns, so an 88% ROI is still good enough for 99.99999% of the people. Maybe for you it is a meager ROI, but I can assure you that most people that invested on Camdem Brewery will never see a ROI like that ever again in their entire lives, it just won't happen, if you believe different then you need to get back to reality and to talk to the average joe.
Crowdcube is inherently flawed, valuations are sky high, DD is non existent, everything is window dressed and most of their investors are clueless about business and finance in general but that doesn't make Camdem Brewery a failure. Granted it was a fluke, but a success nonetheless for the ECF industry worlwide, it gave their investors their money back and some more unlike crap like Wool and the Gang. So stop being petty about this exit, as the ECF industry will seldom see returns like this one.
You sound like one of the people you describe. Its naive to call this type of investment a success. If you take the advice offered by the likes of CC, then you should invest in at least 10 co's. 7 of these will go bust, 3 will give a return. Optimistic but lets work with those figures. £1k in each. So for you to get back to BE you need the 3 successes to make more than 3 times the investment - ignoring EIS/SEIS. You do the math. Also v importantly investors in Camden were not given any choice in this sale - they had to abide by the drag along clause. Dont you think that an investment by AB might make the company rather more valuable in say 2/3 years time than it was then? The risks are not being rewarded - investors are being led by the nose. Still we estimate CC wont see out 2017 on its current completions.
Delete