Ridelink failure kicking up a dust storm on Seedrs

Ridelink raised £1m on Seedrs and then went bust. Investors want to hear a plausible explanation. Seedrs are silent but their forum isnt.

UPDATE - we have just been sent this interesting link on the history of Rocket Internet and its founding brothers. Had you all known this, it is a fair bet you would not have invested in Ridelink or for that matter any of companies in the Rocket stable. We have not verified their information so take it as you will - it certainly fits with the Ridelink outcome -  

http://www.lordshipstrading.com/search/label/Rocket%20Internet. 

In what looks like an out and out scam, Ridelink used equity crowdfunding to extend their failing business for a few months, only to find that no one else would give them anymore cash - so they folded.

Cries of 'well what did you expect, this type of investment is high risk' is pretty well all the defence they can come up with. That and totally groundless accusations that what we have written here is incorrect - well you have the opportunity to rebut and sue. Didnt think so.

Reading through the forum, it is clear that this wasnt a scam in the sense that these guys set out to take the public's money with no intention of delivering anything. 

Ridelink's burn rate was high and they needed cash. The plans showed that the Seedrs cash wouldnt last long, so they would need more. People who invest in this type of offer are maximising the risk. The company couldnt raise more. Caput,  So long,  Adieu.

But there are some interesting side issues. What if the company knew that it couldnt raise more via VCs etc before it came to Seedrs? Then it would be a scamette. And it does seem odd, as one comment points out, that the Seedrs £1m was only due to last a few months, yet the company apparently had no knowledge that they would have problems raising more. That is not credible. They must have known the market.

Then there is the issue of the salaries. The Founders are forceful in their denial that there was anything wrong with their levels - set as they were by the major shareholder Rocket. Marcin even exclaims that in two years he hasnt had a raise or a bonus! Mon dieu, sweet lamb. As anyone who has been involved in this world knows, companies losing money do not pay founders, companies about to go bust take money off founders, their friends and family. 

We'd be tempted to put the whole thing down to gross naivety on all parts. Ridelink was a goner way before the Seedrs campaign. They took money via Seedsr because they couldnt get it anywhere else - the proof is there in the few months post Seedrs. Investors ignored this; Seedrs ignored it. Seedrs failed to protect investors by having this company on their site in the first place. What role Rocket played may never be known but sure as eggs are eggs, neither Seedrs nor their investors would have participated without that rubber stamp. As owners of Ridelink, Rocket must have known the true picture as much as Ridelink did. So who was calling the shots? 

Aye - there's the rub.