Great news for investors in Movem - an exit. Just a month ago Movem was taken over by Barbon in a deal which leaves the CEO in place and Movem in tact. So did investors make any money?
Addendum - sales price was a smidgen over £1 a share so a total value of £3m. First rounders did ok and second rounders wasted their time. Maybe that's why Crowdcube have ignored it? Thanks to SHs. It looks to me like another Ecar Club or Camden Brewery rush to exit before implosion. Reading some comments on Crowdcube, this will have done them more harm than good. Investors in round 2 feel used - a cheap bridging loan to enable founders to exit is one interpretation. And for what risk? Im sure we can do better than this. Our new forum will be the the place to get the information (like this) that CC bury.
Movem had two successful rounds on Crowdcube in 2016 for £199k and then 2017 for £395k. The first round valued the company pre money at £800k and the second at £2.4m. Now we dont know the numbers for the takeover but we do know that a SH invested £3000 and received £7811 on the sale. - Well we do now.
As we now know thanks to SHs getting in touch - Movem was sold for £3m. As investors in 2017 paid £2.4m with a post investment valuation of ~£2.8m there aint much profit in that. Investors were not given a choice in this. As one disgruntled investor put it - a very cheap loan to get founders to a sale where they cream off the money. It was also mentioned that there should be a list of people who make claims like 'Im in it for the long term' and sell investors out 12 months later - a list where future attempts to make the same claims can be challenged. We will be offering such a list on our soon to be launched new site. Welcome Peter Ramsey, Philip Screeton and Richard Totty.
And of course as a good reader has reminded us, investors in round 2 will have to repay their EIS reliefs. In fact as round 1 was in 2016, this sale in September 2018 is still within the 3 year limit, so they too will have to repay it.
And of course as a good reader has reminded us, investors in round 2 will have to repay their EIS reliefs. In fact as round 1 was in 2016, this sale in September 2018 is still within the 3 year limit, so they too will have to repay it.
No wonder CC have not PRinged this big time.
From what I know exit valuation is around 3 mil.
ReplyDeleteYou can check movem discussion page on crowdcube
I can confirm that investors in the second round made a profit of exactly 8.85%.
ReplyDeleteInvestors in the second round had a return of exactly 8.85%.
ReplyDeleteThanks - so as we said a cheap way to take out a bridging loan considering the risks involved.
ReplyDeleteand presumably round 2 investors now have to repay their 30% EIS .... so the takeover will effectively cost them money
ReplyDeleteselling at par in a longer time period would have given a better return - illustrates the faults with the model.