Lovespace - the reality for small investors

Are Crowdcube and Lovespace giving us all the facts?

This question was recently posted on the Lovespace pitch - we think it asks some very good questions not just of the company but also the way the platform has 'organised' the information it presents to investors - 

Ccube, a bit disingenuouly IMO, is referring to this a Lovespace's second round in its communications. In fact, as I think you have acknowledged, there have been at least 2 other rounds in between, so this effectively round 4+ since the first Ccube round. Acknowledging that most investors will have knowingly invested in B shares, I presume that there will again be no guarantees for investors who would otherwise wish to follow on their investment this time so material dilution should be expected/factored-in?

Having been shut out completely of the funding round which followed the first CCube raise In your communication to existing B shareholders at the time of the next funding round in November 2015 to raise £1m (with just over £500k committed at that point), Steve Folwell made it pretty clear that you were only interested in hearing from investors wishing to invest £25k+ for new A shares. If you were apparently so loathe to accept smaller investments of less than £25k from B existing shareholders in November 2015 why are you back now? Thanks.

We'll let you know the response.

I think it would not be unfair to say that all small investors under the CC model may suffer the same fate - or worse.

Lovespace struggle to fill up second time around

Lovespace raised a shed load of money on Crowdcube and now they have spent it, they are back for more.

We are not going to bother with figures for this post - what is the point?

Lovespace's explanation for their very poor performance and their very large losses is that they are evolving. Funny that, for the first raise they were very positive that their projections were conservative and more than doable. Nothing wrong with evolving but you cant have it both ways.

If you want to have a laugh just read the responses to the questions in their current forum - they are certainly not short of strategy, business school BS.

This time around the investors are being far more cautious with only a few days to go the total raised is well short of the target. But our money is on a this one completing - it's too large a punt for Crowdcube to let fail. Either extensions, increased equity or a large sum will suddenly materialise and the hey presto the box will be full.

We have seen it all before.  

Lovespace boxes may have dodgy bottoms

Lovespace smashed their first raise on Crowdcube in 2014

They raised over £1.5m against an ask of just £600k.

Now they are back for more - only this amount was not scheduled the last time they appeared.

The good news for Crowdcube investors is that the value of the company has increased almost 4 times in just over a year. 

The bad news for Crowdcube investors is that this value is total myth. The company projected sales revenues of almost £2m for YE December 2015. It has delivered just over £1m.

The company projected losses just over £300k for YE December 2015. It has delivered losses of over £1.5m. No wonder they are back for more. 

All this has been achieved using up the pile of extra cash they were given.

We cant see any reason to believe a single figure Crowdcube produce. The only certainty is that whatever the projections,  the company will fall way short of them. 

This box comes with a warning - HANDLE WITH CARE