Onelane raised £280k on Crowdcube for its service of delivering children to their destinations. Little over a year later they are closing down as they were unable to raise the £1m they declared they needed this year.
So when a pitch on Crowdcube or any platform says it needs to raise £1m next year or the year after, it is worth asking them how they will do this. Or you end up where investors in Oneland are now - a dead end.
In the letter sent around to all shareholders, Camron, the founder, makes a good job of explaining what went wrong. But when you peel away all the pith, it all comes down to crass mismanagement and huge imaginations. If the idea had any legs they would have found investment, they didnt even try the usual Crowdcube trick of upping the valuation and having another CC round. According to Camron they were on target but no one would listen.
For a guy who claims to have an MBA and some connection to Harvard, oh and was instrumental in the role out of Just Eat in the UK, he sure wasnt much good at getting down and dirty when things got a little choppy.
We asked him what he had paid himself and why the investors hadnt been more pliable. No answer. One clue might have been the fact that of the 12 questions on the original Crowdcube pitch , he only bothered to answer 6 and he avoided giving any detail to one that was specifically asked about how he intended to go about raising this £1m.
He claims excellent traction but the current 176 Twitter followers and 600 odd FB likes seems to throw this into doubt?
In his last email he says -
It particuarly pains me that you entrusted us with your investment and I failed to provide you with a return. It is important to point out that you backed a service that worked really well, had tons of innovations in the pipeline, and was on its way to improve the routine for thousands of parents. With further funding, there is no doubt that we would have been a great success
Apart from the obvious lack of attention to detail, this is complete nonsense and is most likely the main reason the business failed.
He claims excellent traction but the current 176 Twitter followers and 600 odd FB likes seems to throw this into doubt?
In his last email he says -
It particuarly pains me that you entrusted us with your investment and I failed to provide you with a return. It is important to point out that you backed a service that worked really well, had tons of innovations in the pipeline, and was on its way to improve the routine for thousands of parents. With further funding, there is no doubt that we would have been a great success
Apart from the obvious lack of attention to detail, this is complete nonsense and is most likely the main reason the business failed.
That pretty well says all you need to know. But they still invested. None of this will change until investors vote with their feet.
PS
Following posting this piece, we had an email from Camron - rather irate(vaguely threatening legal action through CC), with the usual spelling mistakes etc and no answers to any of our Q's except the one on salaries. He states that he paid himself nothing in year 1 and was paying himself below market rate in the final year ie now. Well call me old fashioned but in my day start ups didnt pay founders salaries until they were in profit - living expenses yes. We live in an instant world today where Crowdcube thrive and poor entrepreneurs take people's cash and pay themselves off the back of running their company into the ground. Great idea.
PS
Following posting this piece, we had an email from Camron - rather irate(vaguely threatening legal action through CC), with the usual spelling mistakes etc and no answers to any of our Q's except the one on salaries. He states that he paid himself nothing in year 1 and was paying himself below market rate in the final year ie now. Well call me old fashioned but in my day start ups didnt pay founders salaries until they were in profit - living expenses yes. We live in an instant world today where Crowdcube thrive and poor entrepreneurs take people's cash and pay themselves off the back of running their company into the ground. Great idea.
