Hapless HAB Housing leave shareholders in the dark

In yet another example of the investor power vacuum, HAB Housing Ltd have filed yet more heavy losses whilst associated companies play swinging doors and restructuring games.  

HAB took £1.8m off Crowdcube investors in 2013 and then another £2m of Crowdbnk investors via a Bond in 2017. Results have so far been on the disappointing side and the GAP between the £8m predicted profit for 2018 and £1m loss is substantial. 

What is more worrying for investors is the silence that has accompanied this. Shareholders we have spoken to say they have been told nothing or very little. HAB Land, an SPV used to purchase land and the company the Bond is in, have now handed over 75% plus control to Bah Restructuring Ltd. McLeaod the TV star who headed up this HAB Crowdfunding share sale has resigned from both HAB Land and HAB Financing plc - as have many other directors. Whilst the building works may not have been busy, the swinging doors certainly have been. 

For a Group that told investors in 2017 that they planned to be building 500 new houses a year by 2020, they seem to have been a little optimistic - or is that misleading? This appeared on  https://www.codeinvesting.com/raising-finance-for-smes-hab-land-interview/. 

Making a total mockery of Equity Crowdfunding

Crowdbnk have rewritten the rules for Equity Crowdfunding - making it into a comedy.

Crowdbnk have decided to pull out of ECF  - concentrating instead on P2P lending. That is fine, but as its parting shot it has made a total mockery of the sector.

We have written several posts on The New Cratfsmen - how they failed to raise a second tranche on Crowdcube then appeared on Crowdbnk to raise the same £1m - without telling anyone about the failure. Then they cut this figure to £750k as they had had no interest. The same 14 investors who put in £565k at the start, were the only ones to invest - yet the pitch remained on the site for months. No new investors.

So what do you do with a flop like this as a platform? Simple solution - you move the target.

So guess what - now the platform can show the same 14 investors and the same £565k as a SUCCESS.  The target they were looking for was only £500k all along - or half the original target. No mention of this slight of hand anywhere on the site of course.

This has clearly been assessed by the FCA as a viable way for the UK to run its ECf platforms. So we need never see another pitch fail. You raise whatever you feel like or whatever people are willing to give you. So there is now no point in any business plan with projections, or any valuations, In fact there is not point full stop. Its just a massive free for all.

Haven't we been here before??

Crowdbnk make themselves look very foolish

The New Craftsmen (NC) has been a subject of several posts here - rather too many in fact.

Crowdbnk purports to be a serious platform for serious investors - not the Woolworth type offer you get from Crowdcube.

So we have ask, why are they making such an ass of themselves over this company?

NC raised money on Crowdcube then decided to switch horses and raise another round on Crowdbnk. Having delivered figures some way off their Crowdcube projections, the original raise of £1m to £1.5m on Crowdbnk, which launched in February this year, was very slow. In fact it was so slow that, despite Crowdbnk emails promoting its success at 'over 50% completed', it has never moved from its initial 14 investors. A cunning rouse was for Crowdbnk to reduce the target - to £750k so that now the same 14 investors have achieved 75% of said target.

This reduction came in March, but as of today the same 14 lonely souls are still the only takers. Apparently the pitch has only 9 days left. Given that this must be the nth time it has had only 9 days left I think we can ignore this prompt.

This manipulation and nonsense just makes your platform look worse than Crowdcube's. Either take off the time limit or stick to it - I'm sure the FCA would have something to say about this being highly misleading. Mind you, they might think the same about bringing the target much closer without telling punters that this is what you have done. Reliance on the overfunding button is an issue the FCA needs to address.  

Crowdbnk might be worse than Crowdcube

The New Craftsmen initially raised cash on Crowdcube, hopelessly failed to meet its projections so decided to raise another £1m on Crowdbnk - see here -

http://fantasyequitycrowdfunding.blogspot.co.uk/2016/03/the-new-carftsmen-going-nowhere-on.html

This attempt on Crowdbnk was a complete flop - despite some interesting Crowdbnk PR which pushed hard up against the fence of transparency.

Now the same company is on the same platform with another 60 days to go raising £750k. It has the already pledged £530k from only 14 'investors' from the last failed campaign in place. No mention of the fact that this is the same failed raise or of the change of target.

You might call this a total con - we couldn't possibly comment!

The New Craftsmen going nowhere on Crowdbnk.

The New Craftsmen raised money on Crowdcube in 2014. We wrote about

http://fantasyequitycrowdfunding.blogspot.co.uk/2016/02/they-do-say-that-one-rotten-apple-will.html
http://fantasyequitycrowdfunding.blogspot.co.uk/2016/02/new-craftsmen-back-on-crowdbnk-having.html

It failed to get even close to the Crowdcube projections, as nearly all Crowdcube funded companies do.

At the start of February this year, it arrived for a new £1m pitch on the ECf platform Crowdbnk. PR issued stated that the NC had already raised just over 50% of its target.

Sadly more than 6 weeks later, NC has still raised just over 50% of its target.

Once again the company failed to take any advice on how to go about this second raise when they had so spectacularly missed their original projections. So like Pact, this one is doomed to fail.

Had they asked us for some advice we could have steered them to a successful pitch and completion of their campaign.

Crowdbnk adopt Crowdcube tactics

They do say that one rotten apple will spoil the barrel.

And it does seem that the type of hype and misdirection used so readily by Crowdcube is now being adopted by other more recent platforms. There really is no place for it in serious business investment.

We noted a few posts ago that Investden had been falsely telling punters that their horse investment was in its last 12 hours and then extending it by another week. This pitch now states it's in negotiation (whatever that means) having raised only 36% of its total. Poor bloody horse must be exhausted.

Now Crowdbnk are also at it.

In a recent email they sent to 'members' they shouted out about their pitch The New Craftsmen being over 50% funded in just a few days - just over £512k to be precise. Hey we all thought, better get over there and invest before the mad rush wipes out our chances.

Well guess what.

A whole two weeks later, the same pitch has still got the same solitary 8 investors with the same total of just over £512k.

So you see it is very easy to shoot yourself in both feet and then your knees if you go around blasting off misleading press releases. You can fool some of the people some of the time, but you cant fool all of the people all of the time. Not even Crowdcube will be able to do that.

New Craftsmen back on Crowdbnk having missed Crowdcube projections.

The New Craftsmen has just launched a £1m to £1.5m ECF campaign on Crowdbnk. Valued today at around £3.75m.

What they dont tell you is that this company has failed with flying colours to get even close to its 2014 Crowdcube raise projections. It was value then at £2.7m. Now that does not mean that it wont make you many millions when it sells for an eye watering sum in the predicted 2020 exit. It may well be that there is a perfectly good reason - projections are after all just that  - projections of what we hope will happen. However simply ignoring this gap, which is a large one even by Crowdcube standards, is not really very helpful.

If we were investing we would want to know the figures used to sell equity in 2014. It seems to us to be a faily routine expectation that if you are investing in a management that made claims about their revenue only 2 years ago that you get to see how these projections turned out. Of course had the projections been met or exceeded we have little doubt the figures would be there for all to see.

Of course the hard working Crowdcube PR department will be fretting over whether to publish this news as good  - ie'' New Cratftsmen shareholders have seen a fantastic increase in their investment'' or bad ie '' New Craftsmen yet another ex Crowdcube success that misses targets and then chooses another platfrom to raise more money on''. It's a tough one for them.

Crowdbnk come into the bracket of 'more serious' ECf platforms and claim on their site that they give you full access to all the information you need to make an investment decision.

We would like to disagree.

Equity Crowdfunding was intended to democratise investment in companies and be good for both the companies and investors. The continual use of selective information means it has done anything but. It's why we need a central regsister so that easy access to comprehensive information is available to all.