Wednesday, 18 April 2018

Crowdcube's Award Winning Flossonic crashes out despite awards.



In 2013 Flossonic won Crowdcube's Product of the Year. Along with a whole host of other winners who have departed this world. It also took £126k off Crowdcube punters, claiming SEIS and EIS.


Since then it has done nothing. Flossonic was supposed to be a special electric toothbrush. Well it either never existed or it couldnt be sold as revenues were next to zero for all years since 2013 and now the company has been struck off by CH.

In summary, the 100 plus investors would have been better investing in a new wooden spoon manufacturer.

In 2013, Crowdcube struck a very rich vein with the award winners they selected and PRinged everywhere -

UPDATE - since writing this a day ago , Affresol has fallen off and is now in liquidation.

Righteous                            - Founders now moved onto Cauli Rice after massive de listing
Front Up                              - Bust
JAM Vehicles                      - Very slow see KS comments
Kamm and Sons                  - Had to change name and still very slow sales.
Green and Pleasant             - Bust
Ovivo                                  - Bust
Pizza Rossa                         - Bust
East End Manufacturing     - Bust
Inspiral                                - Hanging on
Solarmass                            - Bust
Wild Trail                            - Bust
Quantock Brewery              - Bust
HAB                                    - Doing OK
Seek&Adore                       - Bust
Ineed                                   - Bust
Affresol                               - Hanging on
Lawbit                                 - Hanging on
E Car club                           - Sold to Eurocar for small 3X ROI on £100k invested.
Carbonlights                        - Hanging on.
Cell Guidance Systems       - Hanging on
Fantoo                                 - Little idea, coupled with Dell.
Asset Match                        - Hanging on
Red Advertising                  - Hanging on - have been back for 5 more rounds.
New Galexy                        - Hanging on
Flossonic                             - Bust
Zovolt                                  - Some crazy accounting!

Dont forget these are Crowdcube's award winners; not some dross off the street. Hanging on means just that - not good at all.

26 in total, one sale for small returns. 11 bust but with 13 others heading that way. One doing OK but not close to an exit. Would you invest in these now?

 Since 2014 Crowdcube have stopped PRinging their awards. You can see why.




6 comments:

  1. Point taken, but "Sold to Eurocar for small 3X ROI on £100k invested."

    "Small"

    Is a bit ridiculous. Most startups fail, 3x return is good. You can't be negative about everything.

    ReplyDelete
    Replies
    1. You are misreading what was said. You know (if you know anything about start up investment) that out of say 10, 7 will fail completely, 2 will give you small returns from 2X to 5x and you hope 1 will give you an excellent return of around X10. Then you might make a little money. So this 3X is a small return not only because a tiny amount was invested (as we point out) but also because its in that segment. If you dont agree with that then you are not in this business. This isnt what we are saying it is the accepted norm. If you consistently fail to get the big one, then you will for ever lose your money. Its not negative - it's the facts.

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    2. ps - Maybe if more Crowdcube investors were aware of the facts they would be more careful where they invest. Ridiculous might well be referred to this.

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  2. No. What you do Rob is knock practically EVERY business that raises capital via Crowd Funding. Using your 26 businesses of the year, 11 have gone bust. 1 has secured exit at x 3 and the other 12 are still building.
    It's a fact that many start ups will fail, it's a fact that many will over estimate sales forecasts and underestimate time to market and the amount of capital required but the 12 are still building. For all you know, the 12 could all yet turn out to be winners!
    If you invested £100 in all 26, you would of spent £2,600 and currently be down c 22% (£900 lost Bust/ £300 Win made it) BUT anything could still happen. Investing in a start up is going to take time

    ReplyDelete
    Replies
    1. Well you are ENTITLED to believe those figures if you like. Please dont use caps - if you want your comments publsihed. What was it in the post you didnt understand about 'hanging on' - I even explained what it meant? I know that there is a chance for 2 out of the 26 - I have done the research. The rest are just waiting to go bust like Affresol, so your figures are already wrong. Guessing and investing dont generally mix well. Actually what we do is wait and see what happens to companies that use ECF - we report the facts. You may not like them. We never or in very rare circumstances where we have proof of wrong doing, comment on a company whilst it is ECFing or before it has filed accounts post funding. As I say we wait for the facts - we speak to the companies and to their investors. Then we tell you what we find. As a matter of information your figures are total nonsense anyway as they disregard both S/EIS reliefs and similar loss relief on the failures.

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    2. Also what you totally fail to understand or choose to ignore, is the other serious consequences of the ECF platforms promoting hopeless businesses. Failure of the businesses that have funded this way is not just a loss for investors. Companies nearly all go bust owing creditors - large sums in many cases. More often than not one of these is HMRC - the very outfit that encouraged them in the first place via S/EIS. This can lead to those other businesses struggling, laying off staff or worst case also closing down. This is not a good way to build up UKplc and the larger this sector gets the more the seriousness of the situation. Your vision is entirely blinkered to investors. It really is not that simple. I could go on about EIS where the Government has in its wisdom just decided to allow the platforms to choose (vet) Advanced Assurance applications because (in their words) the platforms carry out thorough due diligence, so will prevent poor companies applying. All the evidence points in the opposite direction.

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